History Says the Nasdaq Could Soar Again in 2025: 1 AI Stock-Split Stock to Buy Before That Happens

The Nasdaq Composite has been on a tear for the past two years, driven by the rise of artificial intelligence (AI) and other factors. In 2023, the tech-focused index jumped 43%, and in 2024, it gained another 33% as of this writing. Historically, following years with gains of 30% or more, the Nasdaq has climbed an average of 19% in the subsequent year. This suggests that the rally could continue well into 2025. As AI continues to advance, investors are looking for opportunities in the sector. One AI stock that could be a compelling buy before the Nasdaq's potential rally is Microsoft Corporation (MSFT).

Microsoft's AI Strategy and Growth Potential
Microsoft has been at the forefront of AI development, investing heavily in the technology and integrating it into its products and services. The company's strategic partnership with OpenAI, the creator of ChatGPT, has been a significant driver of its AI initiatives. Microsoft has used OpenAI's technology to create the Copilot virtual assistant, which is embedded in its flagship software products like Windows, Bing, and Edge. Additionally, Microsoft's Azure cloud platform is a go-to destination for developers seeking state-of-the-art computing infrastructure and ready-made large language models (LLMs), like OpenAI's latest o1 series, which are key ingredients for creating powerful AI software applications.



Microsoft's AI services revenue grew by 33% year over year in the recent fiscal 2025 first quarter ended Sept. 30, with 12 percentage points of that growth specifically coming from AI services. This figure has been accelerating in every quarter since Microsoft started reporting it more than a year ago. As AI continues to grow in importance, Microsoft's AI services could be a key source of stock-price appreciation in the years ahead.

Microsoft's High Stock Price and Potential Stock Split
Microsoft's stock price has been on an upward trajectory, reaching $415 as of this writing. The company's high stock price may make it inaccessible to some retail investors. A stock split could make the stock more affordable and attract more investors, potentially driving up the stock price. Microsoft has completed nine splits since its stock came public in 1986, and its most recent split was more than two decades ago in 2003. A 3-for-1 stock split would reduce Microsoft's stock price to $138 per share, making it more accessible to smaller investors and placing it in line with other trillion-dollar tech giants like Nvidia, Amazon, Alphabet, and Apple, which have stock prices between $100 and $250.

Microsoft's AI initiatives and growth potential make it an attractive investment opportunity in the AI sector. As the Nasdaq Composite continues its rally, Microsoft's stock could be a strong performer. Investors who buy Microsoft stock before the potential stock split could see significant gains as the company's AI initiatives drive growth and the stock becomes more accessible to a broader range of investors.

Important note: Investors are reminded to do their due diligence and not rely on the information provided as financial advice. Consider this article as supplementing your required research. Please always apply independent thinking.