Analyst Daniel Ives likes what he sees in this database software firm. The tech expert runs through several factors that should attract investors to this stock, writing, “The company sees strength across net new logos while the launch of its new products will reaccelerate its growth over the coming quarters… Couchbase estimates their TAM to grow to ~$150 billion by 2028 with high performance and scalable modern applications driving the market with AI accelerating further opportunity for high-performance applications as the company is aligned to meet demand for growing DBMS market sub-segments across cloud and on-premise environments.”

Looking ahead, Ives goes on to explain how the Capella platform has potential to boost Couchbase’s performance: “Although still early in terms of its contribution to revenues or ARR, the company noted that it plans to disclose Capella metrics going forward with Capella acting as a ‘game changer’ for BASE with easy adoption or deployment compared to alternative customer managed offerings while helping reduce adoption friction leading to an acceleration in its net new customer adds, some driven by Capella, and existing customers with on-prem products migrating and expanding on Capella.”

Along with a recent upgrade from Neutral to Outperform (i.e. Buy), Ives has a $26 price target on BASE shares, suggesting a one-year gain of 60%. (To watch Ives’ track record, click here)

Overall, Couchbase has a Moderate Buy consensus rating from the Street, based on 13 reviews that break down to 10 Buys, 2 Holds, and 1 Sell. The stock is priced at $16.25 and its $22.62 average target price implies a gain of 39% in the coming year. (See Couchbase stock forecast)

Dynatrace (DT)

Next up is Dynatrace, a $16 billion large-cap player in the software field. Dynatrace offers its customers the latest in AI-powered, cloud-based data management technology. The company’s platform supports intelligent automation that puts network management, cloud monitoring, and data analytics to work, in one place, for a unified mission. Dynatrace’s platform can be applied to almost any aspect of the tech and business worlds, allowing its users to tap into AI-powered app automation, business analytics, digital security, infrastructure monitoring, and microservices.

By the numbers, Dynatrace has an impressive business footprint. The company boasts more than 4,000 subscription customers, generating approximately $1.5 billion in annual recurring revenue. An impressive 95% of the company’s top line comes from its subscription services, and the company has a gross retention rate in the mid-90% range, indicating a high level of customer satisfaction. Dynatrace can count some big names among its customers, including Dell Technologies, Air Canada, and the government of Australia.

This past summer, Dynatrace released its financial results for its fiscal 1Q25 (June quarter). The top and bottom lines for the quarter both came in well above the forecasts – revenue, at $399 million, was up almost 20% year-over-year and was $6.56 million better than anticipated; the non-GAAP earnings per share, of $0.33, was four cents per share over expectations.

Drilling down, the company’s headline results on subscription business bode well for the future. Total subscription revenue was $382 million for the quarter, for a 21% y/y gain, and the annual recurring revenue (ARR) hit $1.541 billion, up 19% from the prior-year period.

This company’s use of AI and its strategy of courting large-scale customers caught Ives’ eye, and the analyst writes of it, “Dynatrace is a leader in the Observability space with an expanding portfolio, and long runway for growth with a unique combination of growth and profitability and has the highest operating margins in the space. The company’s focus on large enterprise customers results in higher ARPU metrics vs. its peers as the company’s technology and competitive positioning is positive as it is one of few vendors in the space that supports a hybrid deployment model.”

Also here the Wedbush analyst recently upgraded his rating from Neutral to Outperform (i.e. Buy) while his bumped-up price target of $67 (up from $55), implies a one-year upside potential of 26%.

Looking at the Street consensus, we find that Dynatrace has a Strong Buy rating, based on 20 recent reviews that favor Buy over Hold by 18 to 2. The shares have a current trading price of $53.25 and the average target price of $60.06 suggests that DT will gain 13% by this time next year. (See Dynatrace stock forecast)

To find good ideas for stocks trading at attractive valuations, visit TipRanks’ Best Stocks to Buy, a tool that unites all of TipRanks’ equity insights.

Disclaimer: The opinions expressed in this article are solely those of the featured analysts. The content is intended to be used for informational purposes only. It is very important to do your own analysis before making any investment.

More importantly, Micron is expecting fiscal 2025 Q1 revenue of $8.7 billion at the midpoint of its guidance range. That would be a jump of 84% from the same quarter last year. The memory specialist has guided for non-GAAP earnings of $1.74 per share for the current quarter, up substantially from the loss of $0.95 per share it suffered in the same quarter last year.

The good part is that its top and bottom lines are expected to jump substantially in both fiscal 2025 and fiscal 2026 (see chart below).

It won’t be surprising to see Micron deliver such impressive growth thanks to the health of the memory market. However, there is a good chance it could end up exceeding analysts’ expectations.

Micron management remarked on the latest earnings conference call that it is “making investments to support artificial intelligence (AI)-driven demand, and our manufacturing network is well positioned to execute on these opportunities.” The company has guided for capital expenditures of $3.5 billion for the first quarter of fiscal 2025, which would be a big leap over the $1.7 billion capex it reported in the year-ago period.

Micron is doing the right thing by increasing its capex, as the company says that it has sold out its entire HBM production capacity for 2024 and 2025. The addressable opportunity in the HBM market is expected to grow from $4 billion in 2023 to $25 billion next year, per Micron’s estimates. So an increase in capital spending should allow Micron to shore up its production capacity and fulfill more demand, which could lead to a stronger-than-expected performance from the company.

Micron stock has been subject to some volatility this year, but it has still clocked respectable gains of 30%, as compared to the PHLX Semiconductor Sector index’s 25% jump. The stock, however, has gained impressive momentum since it reported its quarterly results on Sept. 25. There is a strong likelihood that it will be able to sustain this bull run in 2025 and beyond, thanks to the favorable dynamics in the memory market, as discussed.

We have already seen in the chart that Micron’s earnings could hit $8.91 per share in the current fiscal year before jumping to $12.80 per share in fiscal 2026. Assuming Micron does generate $12.80 per share in annual earnings after a couple of years and trades at 30 times forward earnings at that time, in line with the Nasdaq-100 index’s forward earnings multiple (using the index as a proxy for tech stocks), its stock price could hit $384.

That would be a big increase from Micron’s current stock price of around $109, suggesting that this chip stock could deliver outstanding gains over the next two years. Given that Micron is trading at just 12.5 times earnings right now, investors are getting a good deal on this tech stock that seems set to skyrocket going forward.

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Harsh Chauhan has no position in any of the stocks mentioned. The Motley Fool has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy.

Semiconductor Sales Could Keep Soaring in 2025: 1 Top Stock to Buy Hand Over Fist Before That Happens was originally published by The Motley Fool