Which Tech Stocks are Poised for Growth in the Next Year?
Tech stocks had a strong showing in May. The Technology Select Sector SPDR Fund (XLK) rose by 6% after the White House took a softer stance on tariffs with key trade partners. Investors became more open to risk, sending high-growth tech companies higher—even though interest rates also went up. Bond markets dropped as worries grew over rising national debt and a larger federal deficit, which pushed yields higher.
Best-Value Tech Stocks
Value investing is all about finding great companies trading for less than they’re actually worth. The idea is that the market will eventually catch on and correct the price. A common tool investors use is the price-to-earnings (P/E) ratio—a lower P/E usually means the stock might be undervalued.
But be warned: sometimes a stock is cheap for a reason. It could be stuck in what’s called a value trap—where it looks like a good deal but continues to underperform. That’s why you should never rely on just the P/E ratio alone. Always ask: Why is this stock cheap, and will that change?
Top Value Tech Picks:
| Company | Price ($) | Market Cap ($B) | P/E Ratio |
|---|---|---|---|
| Yiren Digital Ltd. (YRD) | 6.24 | 0.5 | 2.5 |
| DoubleDown Interactive (DDI) | 10.10 | 0.5 | 2.7 |
| Consensus Cloud Solutions (CCSI) | 21.37 | 0.4 | 4.9 |
- Yiren Digital Ltd is a China-based AI-driven platform offering digital finance, insurance, and lifestyle products. In 2024, it helped issue 53.5 billion RMB in loans—up from 36 billion RMB the year before.
- DoubleDown Interactive is known for online casino games like DoubleDown Casino. Despite a drop in revenue in Q1 2025 ($83.5M vs. $88.1M), it remains a player in both social and iGaming.
- Consensus Cloud Solutions offers secure cloud communication and digital signature tools. While Q1 2025 revenue dipped slightly to $87.1M, the company maintained its full-year outlook.
Fastest-Growing Tech Stocks
Growth investors look for companies with rising revenue and earnings. But focusing only on one number, like earnings, can be misleading due to temporary boosts like tax breaks or mergers.
We look at both year-over-year (YOY) revenue and EPS growth equally to get a better picture—and avoid outliers growing more than 1,000% in a single quarter since those usually aren’t sustainable.
Also Read: How to Use Backtesting Tools to Evaluate Trading Strategies?
Top Growth Tech Stocks:
| Company | Price ($) | Market Cap ($B) | EPS Growth (%) | Revenue Growth (%) |
|---|---|---|---|---|
| Sezzle Inc. (SEZL) | 105.31 | 3.5 | 347 | 123 |
| Innodata Inc. (INOD) | 36.48 | 1.2 | 626 | 120 |
| Mobileye Global Inc. (MBLY) | 15.61 | 12.7 | 54 | 83 |
- Sezzle Inc. is a Buy Now, Pay Later service popular among Gen Z and millennials. In Q1 2025, revenue jumped 123% to $104.9M, and total merchandise volume hit $809M.
- Innodata Inc. provides data engineering for generative AI systems. In Q1 2025, revenue surged 120% to $58.3M, driven by strong demand from major tech clients.
- Mobileye Global Inc. develops driver-assist and autonomous driving tech. In March 2025, they partnered with Volkswagen to roll out hands-free driving and smart parking features.
Tech Stocks with the Most Momentum
Momentum investing focuses on buying stocks that have been doing well recently—under the belief that they’ll keep rising if their momentum is backed by strong fundamentals.
This works well in tech, where innovation often leads to sharp price jumps. But be careful: rising stocks can become overvalued fast, and when sentiment changes, prices can drop quickly.
Top Momentum Tech Stocks (12-month return):
| Company | Price ($) | Market Cap ($B) | 12-Month Return (%) |
|---|---|---|---|
| Quantum Computing Inc. (QUBT) | 13.31 | 1.9 | 1801 |
| Diginex Limited (DGNX) | 57.01 | 1.3 | 1238 |
| Sezzle Inc. (SEZL) | 105.31 | 3.5 | 843 |
- Quantum Computing Inc. is working on next-gen photonic quantum computers. Even though it’s still pre-revenue, investor excitement soared after a rival firm announced a game-changing quantum machine.
- Diginex Limited helps companies with ESG and sustainability reporting using blockchain and AI. In May 2025, it received a $300M investment from an Abu Dhabi royal family member.
- Sezzle Inc. makes the list again thanks to its impressive growth and strong investor interest.
Pros of Investing in Tech Stocks
- High Growth Potential: Many tech firms grow revenue quickly and expand globally, especially in AI, cloud, and cybersecurity.
- Innovation: These companies are often at the forefront of game-changing innovations.
- Recurring Revenue: Subscription-based models (like SaaS) offer steady income and better long-term stability.
Also Read: What is Dollar-Cost Averaging and How does it Work?
Cons of Tech Stocks
- Volatility: Prices can swing sharply due to rapid changes in tech or competitive pressure.
- Valuation Risks: Tech stocks often trade at high prices based on future growth. If they don’t deliver, the stock can drop fast.
- Regulatory Pressure: Big tech faces growing scrutiny on issues like privacy and competition, which can hurt business and investor confidence.
Post Comment