Buy 3 AI Laggards of 2025 With Solid Short-Term Price Upside Potential

Zacks Investment Research highlights Arista Networks (ANET), Five9 (FIVN), and HubSpot (HUBS) as AI-related stocks that have underperformed in 2025 but present short-term upside potential. Despite headwinds like Fed rate ambiguity and trade policy concerns, all three stocks carry a Zacks Rank #2 (Buy) and show improved earnings estimates, with brokerage firms projecting price increases of 19.3%, 35%, and 23.9% respectively, based on current prices.

Analysis

The artificial intelligence sector, following a robust bull run in 2023 and 2024, has encountered significant headwinds in 2025, including uncertainty surrounding Federal Reserve rate cuts, recessionary fears, competition from low-cost Chinese AI platforms, and concerns over potential Trump administration tariff and trade policies, which have dampened investor confidence in equities, particularly technology stocks. Despite this challenging backdrop, Arista Networks (ANET), Five9 (FIVN), and HubSpot (HUBS) have been identified as AI-related laggards with notable short-term upside potential, all carrying a Zacks Rank #2 (Buy). Arista Networks is projected for current-year revenue and earnings growth of 18.7% and 12.8% respectively, with its consensus earnings estimate improving 4% in the last 30 days and an average brokerage price target suggesting a 19.3% upside from its last close of $92.79, with a potential maximum upside of 40.1%. Five9 expects current-year revenue and earnings growth of 9.6% and 11.7%, respectively; its consensus earnings estimate has risen 6.6% recently, and brokerage targets indicate a 35% average upside from its $27.11 closing price, with a maximum upside of 139.8%. HubSpot forecasts 15.4% revenue growth and 14.9% earnings growth for the current year, with a 2.1% improvement in its consensus earnings estimate over the past 30 days and an average price target implying a 23.9% increase from its $616.92 closing price, with a maximum upside of 50.7%. Each company is leveraging AI in its core offerings: ANET in network architecture and management, FIVN in its intelligent cloud contact center solutions including a new platform on Google Cloud, and HUBS through its integrated AI features within its CRM platform.

Key Decisions for Investors

• Investors seeking exposure to AI-related equities could consider Arista Networks, Five9, and HubSpot, given their Zacks Rank #2 (Buy) status, positive recent earnings estimate revisions, and significant short-term upside projected by brokerage price targets, despite broader market headwinds.
• Evaluate the specific risk-reward profiles, noting ANET's potential 19.3-40.1% upside against a 6.2% downside, FIVN's substantial 35-139.8% potential upside versus a 15.2% downside, and HUBS's 23.9-50.7% potential upside with brokerage targets currently above its last closing price.
• Maintain vigilance regarding macroeconomic factors such as Federal Reserve policy, recession indicators, and international trade developments, as these identified headwinds could still impact the performance of these technology-focused investments.