In a recent appearance on CNBC’s ‘Squawk on the Street,’ Dan Ives, the global head of technology research at Wedbush Securities, shared his bullish outlook for the tech sector into 2025. Known for his accurate predictions, particularly his forecast of the Nasdaq reaching 20,000 this year, Ives reiterated his confidence in tech stocks, suggesting that we are still in the early stages of what he describes as a fourth industrial revolution driven by AI.
Ives emphasized that the tech rally is far from over, likening the current state to being at 10 PM at an AI party that lasts until 4 AM. He predicts another 25% increase in tech stocks over the next year, setting sights on the Nasdaq potentially hitting 25,000 by late 2025 or early 2026. This optimism stems from his observations on the global scale of AI capital expenditure, which he believes could exceed $1 trillion in 2025 due to an underestimation by the market of AI’s potential by 30 to 40%.
He highlighted the significant multiplier effect in tech spending, where for every dollar spent on AI chips from companies like Nvidia (NVDA), there’s an 8 to 10 times multiplier across the tech ecosystem. This effect is seen in companies like Palantir (PLTR), Salesforce (CRM), and others, which are now at the forefront of AI integration. Ives sees these developments as just the beginning, urging investors to prepare for a broader adoption of AI both in enterprise and consumer markets.
Addressing concerns about potential market corrections, Ives acknowledged there would be moments to “breathe” but advised viewing any sell-offs in companies like Oracle (ORCL) or Adobe (ADBE) as buying opportunities. He believes these corrections are short-term in light of the long-term trajectory driven by AI innovations.
On the topic of individual stocks, Ives commented on the implications of political engagements, like Mark Zuckerberg’s visit to Mar-a-Lago and potential meetings with President-elect Trump. He suggested that such interactions could lead to a more favorable regulatory environment, potentially boosting deal-making in tech by over 50%. This scenario, he believes, would particularly benefit companies like Meta (META), Alphabet (GOOGL, GOOG), Amazon (AMZN), and Tesla (TSLA). Notably, Ives predicted Tesla could see its market cap reach $2 trillion by the end of 2025, fueled by advancements in autonomous driving and a more deregulated environment.
Ives’s commentary paints a picture of a tech sector poised for significant growth, driven by AI’s expansive role across industries, suggesting that investors should maintain or even increase their stakes in tech, especially during market dips, to capitalize on what he sees as a continuing bull market.
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