2 Artificial Intelligence (AI) Stocks That Wall Street Predicts Could Rise by an Average of 47% and 54%

AI Stocks: Navigating a Year of Volatility and Opportunity

This past year has been turbulent for companies involved in artificial intelligence. While the technology continues to evolve and reveal its transformative potential, investors remain cautious about the hefty investments these firms are making to expand their AI capabilities. Even industry giants, including members of the so-called "Magnificent Seven," have taken on debt to finance their AI infrastructure, leaving some uncertainty about whether these expenditures will ultimately pay off.

Despite these concerns, many financial experts on Wall Street believe the recent downturn in AI stocks may be exaggerated, and they see promising prospects ahead. According to consensus forecasts, analysts have identified two AI-related stocks that could climb by 47% and 54% respectively.

Could AI Lead to the First Trillionaire? Our analysts have just released a report on a lesser-known company, dubbed an "Indispensable Monopoly," that supplies essential technology to both Nvidia and Intel.

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Microsoft: A Tech Titan Facing New Challenges

It may seem surprising that Microsoft (NASDAQ: MSFT), a company with such a broad and robust technology portfolio, has experienced a notable decline in its stock price recently. Even without its AI initiatives, Microsoft remains a powerhouse in the tech sector. However, the company is also positioned to be a major winner as AI ushers in what many are calling the next industrial revolution.

Microsoft’s shares have stagnated in part because the company has already invested more than $72 billion in capital expenditures during the first half of its fiscal year 2026, ending in June. These investments, which exceeded expectations, have largely been allocated to AI infrastructure, including GPUs and data centers.

Additionally, some investors are underwhelmed by the progress of Microsoft Copilot, the company’s AI-powered assistant and chatbot. During its latest earnings call, Microsoft reported 15 million paid Copilot users—a small fraction compared to its total Microsoft 365 subscriber base and far fewer than leading AI chatbots like ChatGPT or Claude. However, Microsoft may not view Copilot as a direct rival to these platforms.

Nevertheless, Wall Street remains optimistic. Out of 33 analysts who have recently published research on Microsoft, 30 rate the stock as a buy and three recommend holding, according to TipRanks. The average price target suggests a potential 47% increase from current levels.

Brent Thill, an analyst at Jefferies, has reaffirmed his buy rating for Microsoft, setting a price target of $675—a potential 66% gain. Thill highlights Microsoft’s comprehensive ecosystem, which includes 450 million Microsoft 365 users and its Azure cloud platform, as a significant strength. He also notes that the stock is trading at about 21 times his projected 2027 earnings per share, a valuation that is reasonable by historical standards.

Looking Ahead for Microsoft

Although Copilot’s adoption has been slower than anticipated, it could become a key growth driver if uptake accelerates. Microsoft’s diverse business operations also provide a buffer, making it less vulnerable to fluctuations in the AI sector alone.

Oracle: Riding the AI and Cloud Wave

Oracle (NYSE: ORCL), a leading cloud services provider, has experienced significant stock price swings over the past half-year. Following a standout earnings report in September, which revealed over $450 billion in future contracted revenue, Oracle’s shares surged.

The company made a strong entrance into the AI data center market, but the rally was short-lived. Much of Oracle’s future revenue was tied to contracts with OpenAI, which was aggressively pursuing AI data center deals across the industry. Oracle also took on substantial debt to finance its data center expansion, raising concerns about future profit margins.

In its latest earnings release, Oracle exceeded Wall Street’s expectations and raised its revenue forecast for fiscal 2027 by $1 billion. The company also reported robust growth in its cloud business and a healthy backlog, helping to ease some investor worries.

Among 32 analysts who have recently reviewed Oracle, 28 recommend buying, while four suggest holding. The average price target points to a 54% potential upside, according to TipRanks.

Brad Zelnick from Deutsche Bank has maintained a buy rating on Oracle, even after lowering his price target from $375 to $300 per share. With the stock trading around $166 at the time of writing, this still represents significant growth potential. Zelnick is encouraged by Oracle’s recent investment-grade bond issuance and OpenAI’s $110 billion private funding round.

The future trajectory of AI remains uncertain—whether its rapid growth will continue or slow down is anyone’s guess. Should OpenAI fulfill its commitments to Oracle, the stock could see substantial gains. With Oracle’s shares down 46% over the past six months and now trading at roughly 22 times forward earnings, the risk-reward balance has become more attractive.

For investors, even a modest position in Oracle could offer considerable upside if the company’s AI and cloud strategies pay off.

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