The group of stocks formerly known as FAANG were synonymous with technological prowess, market dominance, and high growth. These companies provided exponential returns and offered the chance to be part of the technological revolution. Their rise to dominance was fueled by innovation, digital transformation, the increasing use of the internet, and their insatiable hunger for growth. In the process, they reshaped industries, altered consumer behavior, and redefined customer engagement. However, over the past couple of years, the acronym has lost some of its relevance as some names have changed and new companies have encroached on the territories of these mega-caps. As a result, the market has started using the term “Magnificent Seven” to better represent the most valuable tech stocks. In this list, we include the ‘Magnificent Seven’ plus five interesting stocks that focus on the transformational technology growth trends such as artificial intelligence, cloud computing, EV technology, and streaming.
Let’s begin by understanding the sheer magnitude of these stocks. We created an equal-weighted portfolio (equal investment in each stock) of all 12 mega-cap technology stocks in this list and compared their combined performance with the S&P 500 Index over the past 5 years. Astonishingly, the mega-caps portfolio has returned over 385% compared to the S&P 500 Index’s return of around 86%. Additionally, these 12 stocks now have a combined market cap of over $20.0 trillion, with around $14 trillion added in the past 5 years. In comparison, the total market cap of all US-listed stocks is approximately $60.5 trillion (as of December 2024; source: Wilshire 5000 Index), making these mega-caps account for nearly one-third of the total US market value. Although it’s not entirely fair to compare market caps to GDP, if we could, and if these 12 mega-caps formed a country, they would rival China as the second or third largest country by nominal GDP.
Despite recent intense competition, challenging market dynamics, and a difficult regulatory environment, these tech leaders still stand tall with their legacy of innovation and digital transformation. We believe their substantial investments in technology infrastructure, strategic acquisitions, international expansion, and continuous innovation have helped them maintain their dominance. Additionally, the rise of artificial intelligence and machine learning has opened new avenues for growth among these tech giants. With that, let’s explore these 12 stocks.
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Out Methodology
To identify the 10 best FAANG+ stocks, we compiled a list of U.S.-listed technology companies with largest market capitalization, along with the stocks from the FAANG acronym. Ultimately, the stocks were ranked in ascending order based on their market capitalization, with the stock having the highest market capitalization ranked at the top.
Note: all pricing data is as of market close on January 31.
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12. Cisco Systems Inc. (NASDAQ:CSCO)
Number of hedge funds: 60
Cisco Systems Inc. (NASDAQ:CSCO) provides products and technologies in networking, cybersecurity, collaboration, and observability. The company designs and sells a broad range of technologies that support the internet and enable digital transformation for businesses, public institutions, governments, and service providers, including hyperscalers. Cisco’s AI-powered offerings include networking hardware, software, and services, with a strong focus on network modernization solutions, data center solutions, cloud computing, and security. The company’s market cap currently stands at $243 billion, up from $190 billion five years ago.
Two-thirds of Cisco Systems Inc. (NASDAQ:CSCO)’s revenue comes from networking, where it primarily sells switching, routing, wireless, server products, and software. The company is well-positioned to benefit from the ongoing digital transformation across industries. It has been heavily investing in its software and subscription-based services, which now account for a significant portion of its revenue (around 57% as of the October 2024 quarter). Its focus on enhancing security offerings and expanding cloud capabilities is expected to drive growth.
On January 28, 2025, an analyst from Exane BNP Paribas upgraded the stock to Outperform from Neutral and raised the price target from $57 to $72. The analyst anticipates several catalysts that could drive Cisco’s revenue and earnings growth beyond expectations. He believes that ethernet will gain better traction in backend artificial intelligence networks in 2025. Additionally, Meta Platforms Inc. (NASDAQ:META) is expected to deploy Cisco Systems Inc. (NASDAQ:CSCO)’s next-generation 8501 switch, which should see increasing volumes in Q1 2025.
11. Salesforce Inc. (NYSE:CRM)
Number of hedge funds: 116
Salesforce Inc. (NYSE:CRM) is a cloud-based software company specializing in customer relationship management (CRM) solutions. The company offers a comprehensive suite of cloud-based applications for sales, service, marketing, and analytics, enabling businesses to connect with their customers more meaningfully. Its platform is designed to help organizations streamline their operations, enhance customer engagement, and drive growth through data-driven insights. The company’s market cap currently stands at $324 billion, up from $178 billion five years ago.
Salesforce Inc. (NYSE:CRM) is heavily investing in AI and machine learning to improve its services and deliver more personalized customer experiences. In recent years, the company has made strategic acquisitions such as Tableau, Slack, and Mulesoft, which have strengthened its position in the collaboration, data visualization, and analytics space. The company will continue to benefit from the increasing demand for cloud-based solutions and digital transformation initiatives across various industries. It remains optimistic about its Agentforce platform, believing that AI agents can help close deals rapidly. During the World Economic Forum in Davos, the company announced plans to invest $500 million in Argentina over the next five years to support the country’s AI growth vision. On the investment, CEO Marc Benioff said:
“We’re excited to invest in Argentina to support AI innovation, digital transformation, and workforce development with our Agentforce digital labor platform. We are entering a new era where autonomous agents can be scaled to provide a workforce without limits as humans and agents work together to drive customer success.”
10. Netflix Inc. (NASDAQ:NFLX)
Number of hedge funds: 121
The advent of Netflix Inc. (NASDAQ:NFLX) revolutionized digital streaming and disrupted traditional TV and movie consumption. As a global streaming entertainment service, Netflix offers a diverse array of movies, TV shows, games, and more, with unlimited viewing on internet-connected devices. With over 300 million paid memberships in more than 190 countries, Netflix Inc. (NASDAQ:NFLX) has solidified its position as a dominant player in the entertainment industry, continually innovating its content offerings and user experience. Its market cap currently stands at $418 billion, up from $148 billion five years ago.
Netflix Inc. (NASDAQ:NFLX) has been intensifying efforts to expand its content library, including original content, and enhance user engagement through original programming and strategic partnerships. The company has invested substantially in creating exclusive content, significantly contributing to subscriber growth. Moreover, Netflix Inc. (NASDAQ:NFLX) is exploring new revenue streams, such as ad-supported subscription tiers and gaming, aiming to attract a broader audience and increase overall revenue. According to company management, there are over 750 million broadband households (excluding China and Russia) and more than $650 billion of entertainment revenue globally, of which the company captured only about 6% in 2024, leaving a vast addressable opportunity.
In January 2025, Netflix Inc. (NASDAQ:NFLX) reported strong Q4 2024 earnings that exceeded analyst expectations. For the quarter, the company added 18.9 million paid streaming customers, more than double what analysts had projected. Management also raised its revenue growth guidance to 12%-14% year-on-year and increased its operating margin guidance to 29% from the previous 28%.
Analysts’ views on Netflix Inc. (NASDAQ:NFLX) have broadly turned positive following these results. The stock was upgraded by a Bernstein analyst to Outperform from Market Perform, with a price target raised from $975 to $1,200. The analyst believes international growth could enable the company to achieve double-digit subscriber growth in 2025 and highlighted that numerous markets remain underpenetrated. Netflix’s growth initiatives, such as the ad-tier, could support substantial user growth. Conversely, Phillip Securities raised the price target to $870 from $695 but downgraded the stock to Reduce from Neutral, citing valuation concerns.
9. Oracle Corp. (NYSE:ORCL)
Number of hedge funds: 91
Oracle Corporation (NYSE:ORCL) offers an extensive suite of cloud applications, platform services, and engineered hardware systems. The company commands a substantial market share in database management systems and provides a variety of enterprise solutions, including Oracle Cloud Infrastructure (OCI), data management, enterprise resource planning (ERP) software, and hardware products such as servers and storage. The cloud and license business includes key infrastructure technologies like Oracle Database, MySQL Database, and Java, which are widely used globally. Oracle Corporation (NYSE:ORCL) supports deployment models that include on-premise, cloud-based, and hybrid solutions. Its market cap currently stands at $476 billion, up from $147 billion five years ago.
Oracle Corporation (NYSE:ORCL) has been aggressively expanding its cloud offerings, establishing itself as a formidable player in the cloud infrastructure market. Recent quarters have shown significant increases in cloud revenue, driven by the rising demand for cloud services and applications. The integration of AI and machine learning into Oracle Corporation (NYSE:ORCL)’s cloud solutions is expected to enhance its offerings, making it an attractive choice for businesses modernizing their IT infrastructure. The company is also expanding its global data center footprint to meet growing customer demands and is expected to benefit greatly from the $500 billion ‘Project Stargate’, positioning itself as a leading player in AI compute.
In January 2025, Oracle Corporation (NYSE:ORCL) announced plans to enhance its global cloud infrastructure by adding eight new cloud regions in North America and Asia over the next 12 months. They will also introduce powerful new capabilities for ‘Oracle Database@Google Cloud’ to increase customer value. Additionally, data center capacity will be doubled in regions like London, Frankfurt, and Ashburn to meet increasing demand.
8. Broadcom Inc. (NASDAQ:AVGO)
Number of hedge funds: 128
Broadcom Inc. (NASDAQ:AVGO) is a global technology company that designs, develops, and supplies a wide range of semiconductor and infrastructure software solutions. The company’s products play a crucial role in enterprise and data center networking, broadband access, storage systems, smartphones, and wireless communications. Broadcom’s extensive portfolio includes solutions for data center networking, storage, and security, making it a key player in the data center ecosystem. It also provides infrastructure software solutions such as Private Cloud, Tanzu, and VeloCloud to help enterprises develop, deliver, automate, manage, and secure their applications. Its market cap currently stands at $1.0 trillion, up from $144 billion five years ago.
Broadcom Inc. (NASDAQ:AVGO) boasts one of the industry’s broadest IP portfolios, with around 21,000 patents. The company has been focusing on expanding its data center solutions, particularly in networking and storage. Broadcom is well-positioned to benefit from the growing demand for high-speed connectivity and data processing capabilities driven by the rise of cloud computing and AI applications. Recent advancements in 5G technology and strategic acquisitions, such as VMWare in 2023 and Symantec in 2019, have further strengthened Broadcom’s market position, enabling it to capture a larger share of the data center infrastructure market.
In December 2024, Broadcom Inc. (NASDAQ:AVGO) reported strong earnings, with full-year 2024 revenue growing 44% year-over-year (YoY) to $51.6 billion. The ‘Infrastructure Software’ segment revenue grew to $21.5 billion, driven by the successful integration of VMware, while the ‘Semiconductor’ segment revenue rose 7% YoY to $30.1 billion, fueled by AI revenue, which surged 220% YoY. On the impressive AI revenue growth, the company’s CEO noted:
“We see our opportunity over the next three years in AI as massive. We currently have three hyper-scale customers who have developed their own multi-generational AI XPU road map to be deployed at varying rates over the next three years. In 2027, we believe each of them plans to deploy one million XPU clusters across a single fabric. We expect this to represent an AI revenue serviceable addressable market, or SAM, for XPUs and network in the range of $60 billion to $90 billion in fiscal 2027 alone. We are very well positioned to achieve a leading market share in this opportunity and expect this will drive a strong ramp from our 2024 AI revenue base of $12.2 billion.”
7. Tesla Inc. (NASDAQ:TSLA)
Number of hedge funds: 99
Our next pick Tesla Inc. (NASDAQ:TSLA) is not a Technology company in a stricter sense. But its exposure to electric vehicle (EV) tech, autonomous driving and AI makes it nothing less than a tech play. The company is an EV manufacturer and clean energy company known for its innovative approach to sustainable transportation and energy solutions. It designs, manufactures, and sells electric vehicles, battery energy storage systems, solar products, and related services. It currently manufactures five different consumer vehicles: the Model 3, Y, S, X, and the Cybertruck. Tesla Inc. (NASDAQ:TSLA) benefits from the alignment of global goals with its mission of accelerating the world’s transition to sustainable energy. Its market cap currently stands at $1.3 trillion, a phenomenal 9x growth from $139 billion five years ago. At a recent conference call, CEO Elon Musk predicted that, with the help of autonomous vehicles and humanoid robots, Tesla has the potential to become the most valuable company in the world, surpassing the combined value of the next top five companies.
In January 2025, Tesla Inc. (NASDAQ:TSLA) reported its Q4 2024 results, with vehicle deliveries of around 500,000 in the quarter, contributing to a total of approximately 1.8 million deliveries for the year 2024. Tesla continues to benefit from increasing demand for electric vehicles and advancements in battery technology. The company is currently focusing on reducing costs and improving margins through vertical integration, including in-house battery production. Additionally, the company’s software capabilities, such as Full Self-Driving (FSD) technology, are expected to enhance vehicle value and customer experience. Recently, the CEO confirmed that unsupervised FSD is planned for release in California in 2025, with potential releases in China and Europe by year-end.
6. Meta Platforms Inc. (NASDAQ:META)
Number of hedge funds: 235
Meta Platforms Inc. (NASDAQ:META) focuses on providing social media platforms and virtual reality services. The company operates platforms such as Facebook, Instagram, WhatsApp, Messenger, and Threads, and also sells wearables like Oculus headsets, aiming to connect people and build communities through its services. It generates nearly all its revenue from selling advertising placements on its family of apps (FoA) to marketers. It boasts a substantial user base, with an average Family daily active people (DAP) of around 3.35 billion. Its market cap currently stands at $1.7 trillion, up from $510 billion five years ago.
In late January 2025, Meta Platforms Inc. (NASDAQ:META) reported robust Q4 2024 results, with sales surging 21% year-over-year (YoY) to $48.4 billion, driven by a 6% increase in ad volumes and a 14% rise in ad pricing. Net income surged by an impressive 50% YoY due to better operating leverage. The company plans to invest $60-65 billion in its generative AI efforts and improving core businesses, which should further position it for long-term growth.
In recent years, Meta Platforms Inc. (NASDAQ:META) has been investing heavily in the development of the metaverse, a virtual environment where users can interact, work, and entertain themselves. The company is aggressively using AI to create new experiences that make its platforms more social, useful, and immersive, while also improving monetization. One of the company’s key focuses has been its pivot towards augmented reality (AR) and virtual reality (VR) technologies, which are greatly enhancing user experiences and are expected to drive future growth. With a strong user base and innovative advertising solutions, Meta Platforms Inc. (NASDAQ:META) is well-positioned to capitalize on the growing demand for digital advertising and immersive experiences.
5. Amazon.com Inc. (NASDAQ:AMZN)
Number of hedge funds: 286
Amazon.com Inc. (NASDAQ:AMZN) is involved in retail e-commerce, content subscription services (Prime Video), advertising, and cloud computing. The company’s product offerings through its online and offline stores include merchandise and media content acquired for resale, as well as products from third-party sellers. Additionally, Amazon.com Inc. (NASDAQ:AMZN) operates one of the largest data center networks globally through its Amazon Web Services (AWS) division. AWS provides a comprehensive suite of cloud services, including computing power, storage options, and networking capabilities, catering to a diverse range of customers from startups to large enterprises.
AWS has been a significant driver of earnings growth for Amazon.com Inc. (NASDAQ:AMZN), contributing around 60% of the total operating profit while accounting for just 17% of total revenue. With the increasing demand for cloud services and digital transformation across industries, AWS is expected to remain the company’s growth engine for many years to come. The robust profitability and cash flows from AWS also enable the company to fund its expansion, particularly in its fulfillment centers. The International and North American e-commerce businesses demonstrate strong operating leverage and have the potential to improve profits in the coming years.
Amazon.com Inc. (NASDAQ:AMZN) is making significant advancements in AI, not just by enhancing its existing offerings, but also by investing in custom silicon chips like Trainium for training and Inferentia for inference. During its Q3 2024 earnings call, management indicated that the total capital expenditure for 2024 is projected to be around $75 billion, with the majority allocated to technology infrastructure and meeting AI-driven demand. The company anticipates increasing its investment even further in 2025.
4. Alphabet Inc. (NASDAQ:GOOGL)
Number of hedge funds: 202
Alphabet Inc. (NASDAQ:GOOGL) is the parent company of Google and a pioneer in internet-related services and products, including online advertising technologies, search engines, cloud computing, software, and hardware. The company is also a leading investor in data centers and fiber networks, operating a vast global network of data centers that support its cloud services and other digital offerings. Its market cap currently stands at $2.5 trillion, up from $880 billion five years ago.
Alphabet Inc. (NASDAQ:GOOGL) continues to strengthen its position in the cloud computing market, which has experienced rapid growth in recent years and is expected to expand significantly in the coming years. The company has been heavily investing in expanding its data center infrastructure to meet the increasing demand for its Google Cloud services. With a focus on AI and machine learning, Alphabet Inc. (NASDAQ:GOOGL) is well-positioned to capitalize on the growing need for data processing and storage solutions. The company continues to report strong operating performance, with Q3 2024 showing a 35% year-over-year growth in cloud revenue, driven by the integration of AI, which is attracting new customers and larger deals. YouTube revenue also continues to show healthy growth. However, Alphabet’s dominance is also subject to regulatory challenges, such as anti-trust lawsuits, which remain a risk.
Analyst views remain broadly positive regarding Alphabet Inc. (NASDAQ:GOOGL)’s growth prospects. Bernstein analyst recently raised his price target to $210 from $185 while maintaining his Market Perform rating. An Oppenheimer analyst also raised his price target to $225 from $215 and maintained his Outperform rating. For the upcoming Q4 2024 earnings results, the analyst expects strong advertising trends and search revenue concerns to be offset by better profitability. Additionally, positive indicators from Meta Platform’s results and its ad pricing growth due to GenAI also bode well for the company.
3. NVIDIA Corporation (NASDAQ:NVDA)
Number of hedge funds: 193
NVIDIA Corp. (NASDAQ:NVDA) designs and manufactures graphics processing units (GPUs), system on a chip units (SoCs), and AI hardware and software. Over the years, NVIDIA has expanded its offerings from gaming GPUs to include data center solutions, AI computing, and deep learning technologies. The company’s GPUs are widely used in data centers for high-performance computing, AI training, and inference, making it a critical player in the data center ecosystem. NVIDIA’s products are essential for powering advanced applications in AI, machine learning, and data analytics. Its market cap currently stands at $2.9 trillion, up from $145 billion five years ago.
NVIDIA Corp. (NASDAQ:NVDA) has transitioned from a PC gaming GPU company to a dominant player in the accelerated computing space, offering full-stack computing infrastructure with data-center-scale solutions. The company’s strength is evident in its commanding over 80% market share in GPUs. NVIDIA has greatly benefited from the growing adoption of AI and machine learning technologies, driving strong demand for its chips. The company’s revenue, profitability, and market capitalization have surged since the introduction of GenAI models like ChatGPT.
Despite the recent selloff triggered by news related to Deepseek, the stock remains a consensus Buy among analysts, who still see an upside of around 36%. Theo Mass, portfolio manager at Northcape Capital, recently remarked that the 17% overnight plunge in Nvidia shares was ‘wildly overdone,’ as it did not fundamentally change the growth outlook for NVIDIA Corp. (NASDAQ:NVDA). Addressing concerns about Deepseek potentially hampering demand, Northcape Capital remains optimistic about NVIDIA’s future. As Mr. Mass stated:
“The biggest game in town that these mega-cap tech companies and US chip suppliers are pursuing is still inference AI over the next five to 10 years. While training has been a significant start to the AI phenomenon, in five or 10 years, Deepseek will be a small start-up in the grand scheme of things. Nvidia has noted that 40% of their revenue is already related to inference AI, and they welcome some competition and optimization in these models. So, I’m still bullish on Nvidia.”
2. Microsoft Corp. (NASDAQ:MSFT)
Number of hedge funds: 279
Microsoft Corp. (NASDAQ:MSFT) is a giant in the tech industry, offering a broad array of software, services, devices, and solutions designed to empower individuals and organizations to achieve productivity and computing prowess. Its cloud computing platform, Azure, is a major player in the cloud services market, providing scalable and flexible solutions for businesses of all sizes. Additionally, Microsoft Corp. (NASDAQ:MSFT) offers products such as Microsoft 365, Windows, LinkedIn, Dynamics business solutions, server products, and gaming. Its market cap currently stands at $3.1 trillion, up from $1.3 trillion five years ago.
The company is currently focusing on integrating AI across its products to enhance data processing capabilities and operational efficiency, which should increase demand for its offerings. It has been aggressively expanding its cloud services, with Azure experiencing substantial growth driven by the rising demand for cloud computing and AI solutions. In its Q2 FY 2025 (FY ending June 2025) report on January 29, Microsoft Corp. (NASDAQ:MSFT) reported a total revenue growth of 12% year-over-year (YoY), with cloud revenue growing 21% and achieving a gross margin of 70%. Company CFO Amy Hood remains optimistic about AI-driven cloud services growth, stating:
“Revenue will continue to be driven by Azure, which, as a reminder, can have quarterly variability primarily from in-period revenue recognition depending on the mix of contracts. In Azure, we expect Q3 revenue growth to be between 31% and 32% in constant currency driven by strong demand for our portfolio of services. As we shared in October, the contribution from our AI services will grow from increased AI capacity coming online. In non-AI services, healthy growth continues, although we expect ongoing impact through H2 as we work to address the execution challenges noted earlier.”
1. Apple Inc. (NASDAQ:AAPL)
Number of hedge funds: 158
Apple Inc. (NASDAQ:AAPL) designs, manufactures, and markets innovative products, including the iPhone, iPad, Mac computers, Apple Watch, and Apple TV. The company also offers a range of software and services, such as the iOS and macOS operating systems, iCloud, advertising, payment services, Apple Music, and the App Store. Its market cap currently stands at $3.6 trillion, up from $1.2 trillion five years ago.
Apple Inc. (NASDAQ:AAPL)’s dedication to design, quality, and user experience has established it as a dominant player in the consumer electronics market. The company is increasingly focusing on services and software, which significantly contribute to its revenue. With a large, loyal customer base and an expanding ecosystem, Apple exhibits strong business momentum. The company’s services segment, which includes subscriptions and digital content, is expected to grow significantly, providing a steady revenue stream. As of December 2024, Apple’s installed base of active devices stood at an impressive 2.35 billion.
Apple Inc. (NASDAQ:AAPL) reported steady Q1 2025 results (FY ending September 2025), with sales growth of 4% year-over-year (YoY) which came in line with street expectations, and EPS coming in slightly ahead of expectations. Sales growth was primarily driven by the ‘Services’ segment, where sales rose 14% YoY, while the ‘Product’ segment sales grew 2%. Among products, Mac and iPad sales increased by around 15% each, but iPhone and Wearables sales were down 1%-2%. The company returned over $30 billion to shareholders in the quarter, including $3.9 billion in dividends and $23.3 billion through repurchases of 100 million shares. Additionally, it plans to expand Apple Intelligence to new markets and languages in April 2025, which is expected to drive further adoption and enhance the user experience.
While we acknowledge the potential of AAPL to grow, our conviction lies in the belief that AI stocks hold greater promise for delivering higher returns and doing so within a shorter timeframe. If you are looking for an AI stock that is more promising than AAPL but that trades at less than 5 times its earnings, check out our report about the cheapest AI stock.
READ NEXT: 20 Best AI Stocks To Buy Now and Complete List of 59 AI Companies Under $2 Billion in Market Cap.
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