AI trades have helped push the market significantly higher since the release of ChatGPT in late 2022. Chipmaker Nvidia (NVDA) has dominated the conversation, but other necessary components for AI hardware and software have been, and will likely remain, winners in 2025.
One key hardware component relates to networking. AI programs need multiple pieces of hardware and software to work, and networking is critical for unleashing an AI’s full computational power.
That’s why a networking company like Marvell Technologies (MRVL) could continue to perform well in 2025. Shares ended 2024 up nearly 83%, far outperforming a great year for the market as a whole.
With the AI trend focusing more on reliable power sources, data centers, and networking capacity, Marvell can play a key role.
Marvell has largely spent the last year retooling, and has lost money overall, but in its most recent quarter clocked in at 22 times earnings.
Action to take: Marvell has high growth potential over the next few years as AI tools get built out. The company’s fundamentals can likely improve from here, and shares are already rallying in anticipation.
Marvell shares are ideal for momentum investors here, and growth investors may want to use any market pullback to also build a stake.
For traders, the June $140 calls, last trading for about $6.90, could see mid-to-high double-digit returns in the first half of the year.
Disclosure: The author of this article has no position in the company mentioned here, but may trade after the next 72 hours. The author receives no compensation from any company mentioned in this article.