High Growth Tech Stocks: Opportunities in January 2025

As we step into 2025, the technology sector continues to be a driving force behind the stock market's growth. With a strong focus on artificial intelligence (AI), cloud computing, and connectivity, tech stocks are poised to deliver substantial returns for investors. In this article, we will explore some of the top high growth tech stocks to consider in January 2025.



1. Microsoft Corporation (MSFT)
Microsoft is a leading technology company that develops and supports software, services, devices, and solutions worldwide. In November 2024, MSFT announced an expanded partnership with C3.ai, Inc. (AI) to accelerate the adoption of Enterprise AI on Microsoft Azure. This collaboration enhances their relationship by integrating C3 AI's advanced application software, including C3 Generative AI, with Azure's powerful cloud ecosystem.
MSFT's trailing-12-month levered FCF margin of 24.11% is 112.5% higher than the industry average, while its trailing 12-month net income margin and ROCE of 35.61% and 35.60% are considerably above their respective industry averages. For the first quarter of 2025, MSFT's total revenue increased 16% year-over-year to $65.59 billion, with an operating income of $30.55 billion and a net income of $24.67 billion. The consensus revenue estimate for the fiscal second quarter (ended December 2024) is $68.86 billion, representing an 11% increase year-over-year, while the consensus EPS estimate is $3.13, indicating a 6.9% improvement year-over-year.
MSFT's bright prospects are reflected in its POWR Ratings, with an overall rating of B, which equates to Buy. The stock has a B grade for Momentum, Stability, and Quality, and is ranked #16 out of 40 stocks in the B-rated Software – Business industry.

2. Alphabet Inc. (GOOGL)
Alphabet, the powerhouse behind a spectrum of tech innovations and various products and platforms worldwide, operates through Google Services; Google Cloud; and Other Bets segments. The company's trailing-12-month EBITDA margin of 36.33% is 95.1% higher than the industry average, while its 12.09% trailing-12-month levered FCF margin is 36.6% above the industry average. In the fiscal third quarter, which ended on September 30, 2024, GOOGL's revenues increased 15.1% year-over-year to $88.27 billion, with an income from operations of $28.52 billion and a net income of $26.30 billion. Street expects GOOGL's revenue for the fiscal fourth quarter (ended December 2024) to increase 12% year-over-year to $96.68 billion, with an EPS of $2.12, indicating a 29.3% growth.



In conclusion, the technology sector remains a strong contender for investors in 2025, with AI and cloud computing trends driving growth. Microsoft Corporation (MSFT) and Alphabet Inc. (GOOGL) are two high growth tech stocks that investors should consider adding to their portfolios. By staying informed about the latest trends and fundamentals, investors can capitalize on the opportunities presented by the tech sector in the coming years.