Wedbush is doubling down on its view that artificial intelligence remains in the early innings of a multi-year boom, arguing that the next few months will separate long-term winners from short-lived hype.
The firm said surging capital expenditures from Big Tech and expanding enterprise use cases are fueling what it calls the next stage of the AI revolution, and it named a group of companies it sees best positioned to benefit through year-end and into 2026.
“We believe the AI Revolution is now heading into its next stage of growth as the tidal wave of Big Tech capex spending coupled by enterprise use cases now exploding across verticals is creating a number of AI winners in the tech world,” the analysts wrote.
Wedbush pointed to strong earnings from Microsoft Corp (NASDAQ:MSFT), Amazon.com Inc (NASDAQ:AMZN), and Alphabet Inc (NASDAQ:GOOG), as well as Nvidia Corp (NASDAQ:NVDA, ETR:NVD)’s robust demand outlook, as validation of its bullish thesis.
According to the analysts, AI spending is now spreading beyond Big Tech to governments, enterprises, energy capacity, and overall infrastructure build outs globally.
Wedbush highlighted Palantir Technologies Inc (NYSE:PLTR) and MongoDB Inc (NASDAQ:MDB) in software, Nvidia and Advanced Micro Devices Inc (NASDAQ:AMD, ETR:AMD) in chips, and Meta Platforms Inc (NASDAQ:META, ETR:FB2A, SWX:FB) as a leader in consumer AI.
It also pointed to cybersecurity firms CrowdStrike Holdings Inc (NASDAQ:CRWD) and Palo Alto Networks Inc (NYSE:PANW, ETR:5AP), while flagging Alphabet and Microsoft as large-cap leaders.
Apple Inc (NASDAQ:AAPL, ETR:APC) and Tesla Inc (NASDAQ:TSLA) were listed as turnaround opportunities, Oklo and GE Vernova as energy plays, Serve Robotics as an under-the-radar robotics name, and CoreWeave and Nebius as infrastructure bets.
The analysts singled out Palantir in particular. “Names like Palantir will further grow into their valuations over the coming years in our view and while healthy pullbacks will happen,” they wrote.
“We believe Palantir is a trillion market cap in the next two to three years given its AI secret sauce that is disrupting the software landscape like an earthquake.”
While some investors have raised concerns about lofty valuations, Wedbush compared the current moment to the early days of the internet.
The report also emphasized the sheer scale of ongoing investment, with US Big Tech companies expected to spend nearly $350 billion on capital expenditures this year, and new players such as Saudi Arabia and the UAE committing to large-scale AI-driven data centers.
“While the bears will fret about valuations and have been skeptical of the historical tech rally, we stress that if you focus solely on valuation looking out a year with price to earnings ratio (P/E)…you would have missed every transformational growth tech stock the last 20 years,” Wedbush concluded.