Tech stocks poised for 2025 gains

If you’re looking for the next two tech winners, stocks with triple-digit upside potential that may be unlocked in 2025, look no further than SoundHound NASDAQ: SOUN and AppLovin NASDAQ: APP. These companies are monetizing AI today, establishing industry-leading technology, and improving their prospects for long-term growth in ways that analysts are noticing. The business trends are sufficient to drive their stock prices higher over time; analyst trends and technical chart patterns suggest that value could be unlocked in 2025.

SoundHound Gains Traction: Hyper-Growth Accelerates on Business Wins

SoundHound AI today

$21.22 +0.98 (+4.84%)

(As of 9:52 a.m. ET)

52-week range

$1.62

▼

$24.08

Price target

$12.07

SoundHound’s stock price rose sharply in 2024 and is likely to continue to rise in 2025 as its hyper growth accelerates and MarketBeat’s reported consensus forecast is likely to be low. A better performance is expected. The latest results include another customer win, which is important to increase revenue and validate the business, paving the way for further customer wins in 2025.

The confirmation is important because McDonald’s is a potential customer. McDonald’s scrapped its first attempt at AI-enabled call services and is reportedly reviewing SoundHound, now used in over 10,000 restaurant locations, for its more than 40,000 locations. Other restaurant chains may follow suit, and the SoundHound technology is suitable for several industries because of how it works. Unlike most voice recognition, which converts audio to text to meaning, SoundHound technology improves accuracy and saves time by going directly from audio to meaning.

Analyst trends provide a strong tailwind for SoundHound stock. The consensus price target of $12 lags the market significantly, but does not reflect the strength of the tailwind. The FQ3 2024 earnings report prompted analysts at Wedbush and HC Wainwright to more than double their price targets, lifting consensus by nearly 100% in less than a week, pointing to a mid-twenty dollar price point. The two targets average $24 or 20% above the current price action at the end of December, and the revision trend is expected to continue in 2025.

Sell-side interest is another strong tailwind for this market. By 2024, institutions are buying this stock at twice the rate of sellers, increasing their position to over 20%. 20% isn’t a huge institutional interest, but it’s growing, and with plenty of stock available, the tailwind it provides could remain in place for many quarters. Technically, the move to new December highs is very bullish for this market and suggests a move to the $30 range is likely.

AppLovin Pull-Back is a purchase that should not be missed

AppLovin today

$344.41 +2.58 (+0.75%)

(As of 9:46 a.m. ET)

52-week range

$37.40

▼

$417.64

P/E ratio

104.37

Price target

$310.71

AppLovin’s stock price pulled back sharply in early December when it was submitted for inclusion in the S&P 500. However, the company’s business has driven the stock price to its all-time highs, and S&P 500 inclusion could come later, making withdrawal a attractive purchase option. The 2024 results include growth in the 30% range, better performance and a move into the e-commerce industry that is expected to sustain top-line growth over the next few years. eCommerce is well-suited to AppLovin’s platform, which uses machine learning to serve ads to targeted markets.

Analysts’ response to the news is as bullish as the response to SoundHound. The revisions since the Q3 report was released lifted the consensus price target by nearly 50%, leading the market to a new record high. The high-end range has this stock trading near $450, about 35% above its late December price action, with revisions expected to continue rising as 2025 progresses. The takeaway from the talk is that AppLovin will be one of the better growth stocks in 2025 as the core business remains strong and e-commerce adds to it gradually.

Among the critical details from the price chart is the trading volume. This stock has seen its volume increase steadily for years and reached new highs in 2024. This indicates increasing ownership, conviction and liquidity supporting the uptrend. The increase in volume is partly due to institutional activity, which rises higher with the stock price as institutions buy on the dip. Another trend that is expected to continue in 2025.

Before you consider SoundHound AI, you’ll want to hear this.

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