Steven Cress, a quant titan renowned for his sharp investment insights, dives into his top stock selections for 2025. He highlights Celestica and its strong fundamentals, alongside Intapp’s impressive liquidity. His top pick? Credo Technology Group, which stands out for its growth potential. Cress emphasizes the importance of valuation metrics like PEG and sheds light on why some metrics matter more than others. With a blend of data and qualitative analysis, he navigates the paths to smart investment choices.
Celestica has shown impressive stock growth with a 240% increase, indicating strong potential and solid financial performance in the IT sector.
Credo Technology Group Holdings stands out as a top pick for 2025 due to its remarkable growth prospects and superior valuation metrics despite appearing expensive.
Deep dives
Celestica's Strong Market Position
Celestica, a significant player in the IT sector, boasts a market cap of $11.27 billion and ranks number one in electronic manufacturing services within its industry. The company's stock performed exceptionally well, increasing by 240% over the past year, while its valuation has improved from a C+ to a B- in six months. Despite this impressive growth, Celestica maintains a favorable comparison against sector metrics in valuation, growth, and profitability, making it a strong buy according to both Wall Street and independent analysts. The company’s robust financial performance is evidenced by its steady revenue growth across various segments, particularly in communications, which saw a 14% increase.
Intapp's Focus on AI Solutions
Intapp, with a market cap of approximately $4.93 billion, excels in application software specifically tailored for the financial services sector, positioning itself as a leader in AI solutions. The company has established a strategic partnership with Microsoft, enhancing its innovation capabilities and expanding its customer pipeline. Significant growth is evident, with a 119% increase in net revenue over the trailing twelve months, reflecting the high demand for its cloud services. Additionally, Intapp has demonstrated strong metrics in valuation and profitability, with an impressive annual recurring revenue growth rate and a solid balance sheet that supports its future initiatives.
Credo Technology's Impressive Growth Metrics
Credo Technology Group Holdings, valued at $12 billion, is a pioneer in semiconductor technology focused on high-speed connectivity solutions crucial for modern data demands. The company has experienced a remarkable 278% increase in stock price over the past year and boasts an exceptional growth outlook, with analysts projecting a 93% ROE growth compared to the sector's average of negative 4.25%. Despite its valuation metrics suggesting it is expensive, the PEG ratio indicates a strong combination of growth and valuation, thus achieving a B- rating. Furthermore, the company's forward-looking revenue and earnings growth rates considerably outperform the sector, illustrating its potential for continued success in the fast-evolving tech landscape.
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Top Stock Picks for 2025: A Deep Dive into Growth and Valuation
Quant titan Steven Cress shares his top stocks for 2025, beginning with Celestica (0:45). Intapp's very strong liquidity and balance sheet (3:00). Why Credo Technology Group Holdings is his number 1 pick (5:15). PEG and why not all metrics are created equal (9:30). Watch the full video here with slides.