History Says The Nasdaq Will Soar In 2025 My 3 Top Ai Stocks To Aol

Bonisiwe Shabane

-Dec 3, 2025, 12:07 AM

history says the nasdaq will soar in 2025 my 3 top ai stocks to aol

Last year was fantastic for the markets in general, but the index that really stood out was the Nasdaq. It climbed 28%, while the S&P 500 rose 23% and the Dow Jones Industrial Average increased 12%. The Nasdaq, heavily weighted in technology companies, surged as investors piled into the industry's hottest new area: artificial intelligence (AI) stocks. Today's $200 billion AI market is forecast to top $1 trillion by the end of the decade, and investors have sought to get in early on this high-growth story. The technology has the potential to transform many industries, saving companies time and money, while boosting earnings as a result. And earnings growth often leads to positive stock performance.

As 2025 gets started, it's logical to ask this question: After two years of gains, will the Nasdaq keep up the momentum this year? History says it will. If we look at the past periods of gains since 1990, in five out of six cases, the Nasdaq has climbed for three consecutive years or more. Of course, the market can surprise us and deviate from a trend, but in general, history has shown itself to be a solid guide. Now, let's look at my top AI stocks to buy before the Nasdaq takes off. You may associate Meta Platforms (META +0.48%) mainly with social media.

The company owns Facebook, Messenger, Instagram, and WhatsApp -- which together have more than 3.2 billion users each day. Written by Brett Schafer for The Motley Fool-> The Nasdaq Composite (NASDAQINDEX: ^IXIC) has had a monster two-year run. After gaining 43% in 2023, the index put up around 30% gains in 2024, marking one of the best-performing periods in its history. Contrary to what your instincts may tell you, this does not mean the index is ripe for a correction in 2025. In fact, the opposite may occur.

Going back to 1972, every year with 30% or higher returns is followed by an average return of 19%, likely due to the momentum factor. While it doesn't guarantee good returns for your portfolio in 2025, it looks more likely than not that the good times will roll, given the historical data. Where to invest $1,000 right now? Our analyst team just revealed what they believe are the 10 best stocks to buy right now. See the 10 stocks » History indicates that the Nasdaq may soar again in 2025.

Here is one artificial intelligence (AI) stock to buy before it does. The Nasdaq has blasted higher over the past two years, gaining more than 43% last year and now heading for an increase of more than 33% for 2024. This is thanks to the artificial intelligence (AI) boom, as five of the benchmark's most heavily weighted stocks and several others in the top 10 operate in this high-growth area. Today's $200 billion AI market is forecast to reach more than $1 trillion by the end of the decade, meaning companies that got involved in this technology early could greatly benefit in the years... Why is everyone excited about AI? Because it could revolutionize the way many things are done, saving companies time and money -- and that's great news for earnings growth.

This alone could offer us optimism about the path the Nasdaq will take next year. But history also offers us reason to believe in another Nasdaq win. Since 1990, five out of six periods of gains have involved the index rising for more than two consecutive years. So, the Nasdaq has generally posted three or more years of gains in recent times. Of course, there's no guarantee this will happen -- indexes and stocks can surprise us -- but if it does, you'll want to be prepared. And the best way to prepare is to buy one particular stock before the Nasdaq soars once again.

Let's find out which one. This player is a member of the Nasdaq, the S&P 500, and, most recently, it joined the Dow Jones Industrial Average. It's advanced more than 2,400% over the past five years. But don't worry. Thanks to its dominance in the AI market and something important unfolding right now, it still could have plenty of room to run. And that's why it still makes an excellent buy today, one that could again lead the Nasdaq higher next year.

AI went viral last year, helping fuel the market recovery. There's likely more to come. The Nasdaq Composite has been gaining ground for more than two years now. Its rise was driven by the dawn of artificial intelligence (AI), a U.S. Presidential election, declining inflation, and the beginning of long-awaited interest-rate cuts. After jumping 43% in 2023, the tech-focused index has gained 33% in 2024, as of this writing.

Yet history suggests the market likely has further to climb. Going back to 1972 -- the first full year in which the Nasdaq traded -- in each year following gains of 30% or more, the tech-centric index has climbed 19%, on average, which suggests... Recent advances in AI get at least part of the credit for investors' bullish sentiment. The economic impact of generative AI is expected to be as much as $15.7 trillion by 2030, according to Big Four accounting firm Price Waterhouse Coopers. This could result in a veritable profit windfall for the leading players in the field. Here are my top 10 AI stocks to buy for 2025 before the Nasdaq climbs to new heights.

Where to invest $1,000 right now? Our analyst team just revealed what they believe are the 10 best stocks to buy right now. See the 10 stocks » As 2025 gets started, it's logical to ask this question: After two years of gains, will the Nasdaq keep up the momentum this year? History says it will. If we look at the past periods of gains since 1990, in five out of six cases, the Nasdaq has climbed for three consecutive years or more.

Of course, the market can surprise us and deviate from a trend, but in general, history has shown itself to be a solid guide. Now, let's look at my top AI stocks to buy before the Nasdaq takes off. The current Nasdaq bull market is young by historical standards, and Wall Street analysts see buying opportunities in Nvidia and Zscaler. The Nasdaq Composite (^IXIC +0.77%) entered a new bull market on April 8. The technology-heavy index has since advanced by 53%, but history suggests more upside is likely over the next year. Since 1990, the Nasdaq has returned an average of 281% during bull markets, compounding at 31% annually.

How can investors capitalize? Most Wall Street analysts view Nvidia (NVDA +2.57%) and Zscaler (ZS +0.19%) as undervalued, as detailed below. Here's what investors should know about these artificial intelligence stocks. Semiconductor company Nvidia reported excellent financial results in the third quarter. Revenue soared 62% to $57 billion, driven by solid growth across all four segments: data center, gaming, professional visualization, and automotive/robotics. Meanwhile, non-GAAP net income climbed 60% to $1.30 per diluted share.

The Nasdaq Composite (^IXIC +0.47%) has advanced 32% year to date due in part to enthusiasm about artificial intelligence. That momentum bodes well for 2025 because strength in the index has historically led to more strength. Since the Nasdaq was created in 1971, it has returned at least 20% in 20 years, and at least 30% in 12 years. And the index has consistently followed those years with more strength, as detailed below: In short, if the Nasdaq returns at least 30% this year, history says the index could surge another 19% next year. Of course, past results are never a guarantee of future performance.

But there is no in harm leaning into trends, so long as the goal is long-term capital appreciation. One Nasdaq stock where Wall Street is particularly bullish is Amazon (AMZN +0.71%), one of only a handful of trillion-dollar companies. Of the 70 analysts following Amazon, 94% rate the stock a buy and the rest rate the stock a hold. Not one analyst recommends selling right now. Amazon runs the largest e-commerce marketplace in North America in terms of sales, and the company is projected to gain share in 2025. Beyond that, Amazon has room to grow given that online sales account for less than 17% of total retail sales in the U.S..

But the company has bigger opportunities in the high-margin industries of digital advertising and cloud computing.

History Says The Nasdaq Will Soar In 2025 My 3 Top Ai Stocks To Aol

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