Markets have gotten off to a rocky start in 2024. Stocks of the fastest growing technology companies have slipped the last several days, throwing a scare into many investors. At the end of the first trading week, technology-laden Nasdaq was down 2%.
However, investors shouldn’t fret too much. Interest rates are expected to come down in coming months, and the U.S. economy continues to exhibit strength. So, the year ahead shows promise for growth stocks. Of course, nothing is guaranteed. But, the tech stocks that have led the market higher over the past decade are a reliable bet to continue doing so in 2024 and beyond.
Therefore, if you can only buy one growth stock in January, you can bank on any one of these.
Microsoft (MSFT)
Truly, Microsoft (NASDAQ:MSFT) at the top of many analysts’ buy lists for 2024. And, the company is quickly closing the gap with Apple (NASDAQ:AAPL) in terms of market value.
While AAPL stock has been sinking to start the year after a slew of analyst downgrades, MSFT has been inching higher. Consequently, Microsoft now has a market capitalization of $2.73 trillion. That’s about a $100 billion less than Apple, the most valuable publicly traded company in the world.
Some analysts see Microsoft overtaking Apple and becoming the top stock this year as it continues to monetize its artificial intelligence (AI) technologies. Unsurprisingly, Microsoft began this year by announcing that keyboards on upcoming Windows personal computers (PCs) will feature a dedicated “Copilot” key that enables immediate access to the company’s AI assistant. Its the most significant change to the Windows keyboard since the 1994 introduction of the “Start” menu key.
The Copilot key is just the latest expectation in the new year for AI advances at Microsoft, making the growth stock one to buy. In the last 12 months, MSFT stock has gained 62%.
Alphabet (GOOG/GOOGL)
Speaking of AI, don’t sleep on Alphabet (NASDAQ:GOOG/NASDAQ:GOOGL). The search engine giant is another leader in the fast emerging field of AI. And it’s expected to continue finding ways to monetize the technology.
In December, Alphabet launched its largest and most sophisticated AI model yet, called “Gemini.” The new model can be used with both personal computers and mobile devices. Additionally, it is capable of a wide range of tasks including answering queries, writing code, and creating content.
Beyond AI, Alphabet is expected to get a boost this year from a rebound in online advertising at its Google search engine. With a U.S. presidential election this November, online advertising is forecast to grow considerably in 2024. With an expected record $15.9 billion, it will be up more than 30% from the 2020 election, according to ad agency GroupM. GOOGL stock has risen 54% in the past 12 months but has trailed the returns of other mega-cap tech stocks. Expect a catch-up in the year ahead.
Amazon (AMZN)
E-commerce giant Amazon (NASDAQ:AMZN) is another analyst favorite for the coming year. Bank of America (NYSE:BAC) just reiterated its buy rating on the stock and its price target of $168 per share, which is 16% higher than current levels. Notably, BAC has one of the more conservative price targets on AMZN stock. Currently, the median target among 51 analysts is $180 a share, which is 24% above its trading spot now.
Additionally, analysts are excited because of multiple catalysts that should drive AMZN’s finances and its share price higher in 2024. At the end of last year, Amazon announced a slew of new initiatives that include adding advertising and raising prices on its Prime streaming service. Other plans involve selling motor vehicles on its e-commerce platform for the first time, launching a new AI chatbot for businesses, and testing a new subscription service for grocery delivery. The company is only now pushing into AI.
AMZN stock is up 66% in the past 12 months.
On the date of publication, Joel Baglole held long positions in MSFT, AAPL and GOOGL. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.com Publishing Guidelines.
