As 2025 draws to a close, investors are turning their attention towards standout technology stocks for the new year, with Evercore ISI highlighting Amphenol, Apple, and Arista Networks as top picks. Analyst Amit Daryanani expresses optimism about the continuing demand for artificial intelligence (AI) infrastructure, predicting that the momentum seen in 2025 will carry over into 2026. However, he emphasizes that cash flow and profitability will take precedence over mere revenue growth as investors seek to understand the real utility of AI technologies.
Daryanani noted, “CY25 was a positive year for the broader IT Hardware/Networking coverage as AI ramps accelerated; stock performance was reflective of revenue growth with less regard to profits.” As the market matures, he believes that margins and free cash flow will emerge as critical factors, shifting the focus to the practical applications of AI investments.
For 2026, the analyst has designated an “AAA” portfolio that includes Amphenol, Apple, and Arista Networks, suggesting that these stocks allow investors a “set-it & forget-it” strategy due to their stable track records and favorable positions to capitalize on the growth of AI technologies.
Amphenol, a prominent manufacturer of electronic connectors, has seen an impressive surge of 94% in its stock value this year. Evercore ISI anticipates that Amphenol will maintain its growth trajectory, citing its robust incremental margins—around 30%—and effective execution as indicators of potential above-market performance and continued earnings per share (EPS) growth in 2026.
Apple, with a stock hike of 63% year-to-date, is also viewed favorably heading into the new year. The tech giant has provided optimistic guidance for its September and December quarters. Rising sales momentum is anticipated following the launch of the iPhone 17 lineup, coupled with durable growth in its Services division. Daryanani mentions that Apple’s pivotal challenge will be to find ways to monetize and generate additional revenue from the anticipated Siri upgrade slated for spring.
On the cloud networking front, Arista Networks has experienced a 19% rise in 2025, and analysts see continued upside potential for the company’s AI-related revenue for 2026. Evercore ISI believes that Arista is well-positioned for revenue acceleration next year, bolstered by ongoing strong momentum across AI initiatives, core growth in its front-end operations, and gains in campus market share.
As these companies gear up for the new year, investors will be closely monitoring their strategic moves and innovations to determine their potential for sustained growth and profitability in a rapidly evolving technological landscape.
