Between now and 2030, the artificial intelligence (AI) industry is projected to grow by around 40% per year. So while AI stocks have generated strong returns in recent years, they could offer significant growth potential from here.
In this analysis, we are going to highlight three AI stocks that currently have ‘buy’ ratings on them from Wall Street analysts. All of these tech companies are growing rapidly today and look set for strong growth in the AI era.
1. Snowflake
First up is Snowflake (SNOW:NYSE). It’s a cloud computing and data analytics company that operates a software-as-a-service (SaaS) business model.
Snowflake appears well placed for success in the AI era for several reasons. Firstly, it can help businesses get their data organised efficiently (the first step when adopting AI). Secondly, it offers sophisticated AI tools that enable companies to gain powerful insights from their data.
In February, Snowflake produced strong Q4 results (28% year-on-year growth in product revenue) and raised its FY2026 product revenue guidance. Wall Street loved this, with a number of firms hiking their price targets for the stock (the average price target right now is $204 which is about 18% above the current share price).
Currently, of the 47 brokers covering Snowflake, 25 rate it as a ‘buy’ while 11 have it down as a ‘strong buy’. So clearly, Wall Street is bullish on this AI stock.
2. Zscaler
Next, we have Zscaler (ZS:NASDAQ). It’s a leading cybersecurity company that serves thousands of customers worldwide (including 30% of the Forbes Global 2000).
Zscaler’s main offering, the Zscaler Zero Trust Exchange platform, is heavily integrated with artificial intelligence. Using AI, the cybersecurity company is able to analyse massive amounts of website traffic in real-time to identify and block sophisticated cyberthreats and protect its customers.
In March, Zscaler posted strong Q2 results (year-on-year revenue growth of 23%) and raised its annual revenue forecast. This led to more than 10 Wall Street brokerage firms increasing their price targets for the stock, with several firms going to $250 or higher.
Of the 47 brokers covering the AI stock, 22 currently have it as a ‘buy’ and 12 have it as a ‘strong buy’. So again, sentiment on Wall Street is very bullish.
3. Microsoft
Finally, we have ‘Magnificent 7’ stock Microsoft (MSFT:NASDAQ). It’s a major player in business productivity software and cloud computing.
Microsoft has a partnership with OpenAI creator ChatGPT. So, it looks well placed for the AI revolution. Already, the company has rolled out powerful AI features, such as ‘Copilot’, across its product suite. There is likely to be a lot more to come in terms of AI from this tech company, however, in the years ahead.
At the end of April, Microsoft posted results for the third quarter of fiscal 2025. A highlight was cloud computing growth of 33%, which was well ahead of Wall Street estimates.
Since the results, a ton of brokers have raised their price targets for the stock with many going to $500 or above (versus a share price of $438 today). Of the 63 brokers covering the tech stock, 34 have it as ‘buy’ while 22 have it as a ‘strong buy’ so sentiment is clearly positive.
Investing in AI stocks
It’s worth pointing out that AI stocks can be volatile at times. And each stock has its own unique risks. Given the risks, it’s a good idea to spread your capital out over several different stocks if allocating capital to the theme. It’s also sensible to take a long-term view – in the months ahead, share prices may fluctuate significantly.
Edward Sheldon owns shares in Microsoft, Zscaler, and Snowflake
Based in London, Edward is a distinguished investment writer with an extensive client portfolio comprising a diverse array of prominent financial services firms across the globe. With over 15 years of hands-on experience in private wealth management and institutional asset management, both in the UK and Australia, he possesses a profound understanding of the finance industry.
Before establishing himself as a writer, Edward earned a Commerce degree from the prestigious University of Melbourne. Complementing his academic background, he holds the esteemed Investment Management Certificate (IMC) and is a proud holder of the Chartered Financial Analyst (CFA) qualification.
Widely recognized as a sought-after investment expert, Edward’s insightful perspectives and analyses have been featured on sites such as BlackRock, Credit Suisse, WisdomTree, Motley Fool, eToro, and CMC Markets, among others.
You can contact Ed at edward@goodmoneyguide.com
