2 Stock-Split AI Stocks to Buy Before They Soar in 2025, According to Wall Street

As artificial intelligence (AI) continues to revolutionize industries, investors are eager to capitalize on the growth potential of AI-driven companies. Two AI stocks that have recently undergone stock splits and are poised for significant upside in 2025, according to Wall Street analysts, are Nvidia(NVDA -2.84%) and Lam Research(LRCX -1.06%). Both companies play crucial roles in the AI supply chain and have strong fundamentals that support their growth prospects.

Nvidia: 85% implied upside
Nvidia is a leading provider of graphics processing units (GPUs), which are essential for AI applications such as training large language models and running AI workloads. The company's GPUs account for 98% of data center GPU sales and 95% of AI accelerator sales, according to the International Data Corporation. Nvidia's full-stack product strategy, which spans hardware and software, gives it a competitive advantage in the AI market. The company's CUDA ecosystem of software development tools, comprising hundreds of code libraries and pretrained models, streamlines the development of AI applications and addresses a broad range of use cases.

Nvidia's strong demand for its current Hopper chips and the upcoming Blackwell processor are driving its growth and contributing to its falling gross margin. Rosenblatt analyst Hans Mosesmann recently reiterated his buy rating on Nvidia and raised his price target to a Street-high, split-adjusted $200, representing potential gains of 85% compared to Tuesday's closing price. He believes that Nvidia's falling gross margin is a "high-class problem" to have, as it is a result of the company's strong demand and the upcoming processor releases.



Lam Research: 20% implied upside
Lam Research develops wafer fabrication equipment (WFE), which refers to the machinery and tools used to make semiconductors. Specifically, it's the second-largest supplier of deposition systems, which create layers of insulating and conducting materials on silicon wafers. It's also the leading supplier of etch systems, which selectively remove material added by deposition systems to create chip features. Lam Research's products are most heavily used in memory-chip production, but foundries like Taiwan Semiconductor also use its deposition and etch systems to manufacture logic chips, like CPUs.

The investment thesis for Lam centers on the likelihood that technologies like cloud computing and artificial intelligence will create demand for increasingly powerful semiconductors over time. Lam products are most heavily used in memory-chip production, but foundries like Taiwan Semiconductor also use its deposition and etch systems to manufacture logic chips, like CPUs. Grand View Research estimates WFE spending will increase at 7% annually through 2030. However, Lam has consistently grown more quickly than the broader market, and management expects the trend to continue in 2025. Beyond that, product development aimed at supporting more sophisticated chip architectures should keep the company on the leading edge of the WFE industry.



Investors should be aware of the associated geopolitical risk. The U.S. government has restricted the export of semiconductor manufacturing equipment to Chinese companies, a market from which Lam currently derives about one-third of its revenue. New export controls or tariffs may strain an already tense trade relationship between the U.S. and Chinese governments, hurting Lam in the process. However, Wall Street currently expects Lam's adjusted earnings to increase at 13% over the next four quarters. That consensus estimate makes the current valuation of 24 times earnings look reasonable. Investors should feel comfortable buying a small position in this stock today.

In conclusion, Nvidia and Lam Research are two AI stocks that have recently undergone stock splits and are poised for significant upside in 2025, according to Wall Street analysts. Both companies play crucial roles in the AI supply chain and have strong fundamentals that support their growth prospects. Investors should consider adding these stocks to their portfolios to capitalize on the growing demand for AI technology.