Chicago, IL – January 15, 2025 – Zacks.com announces the list of stocks featured in the Analyst Blog. Every day the Zacks Equity Research analysts discuss the latest news and events impacting stocks and the financial markets. Stocks recently featured in the blog include: UiPath Inc. PATH, Five9 Inc. FIVN, Innodata Inc. INOD, Fastly Inc. FSLY and Jabil Inc. JBL.
Wall Street has been suffering from severe volatility since the beginning of 2025 after two consecutive years of an impressive bull run. The technology sector has suffered the most in this volatility as this space was the major beneficiary of the last two years’ rally.
A large section of economists and financial experts have raised concerns about the highly valued technology sector, especially against the backdrop of investors’ discomfort about the Fed’s trajectory of interest rate cut in 2025.
Nevertheless, the technology sector will remain buoyant in the long term supported by its relentless innovative power. No other sector evolves as frequently as technology. Within this space, artificial intelligence (AI), cloud computing and data center, the Internet of Things (IoT) and 5G wireless technologies are receiving massive market traction.
At this stage, it will be prudent to invest in small and mid-sized stocks focused on the above-mentioned areas. Five such stocks with a favorable Zacks Rank are: UiPath Inc., Five9 Inc., Innodata Inc., Fastly Inc. and Jabil Inc.
The fundamentals of the U.S. economy remain rock solid as revealed by the resilient labor market data of December. Robust job additions, reduction in unemployment rate, steady wage growth and lower weekly jobless claims bode well for the economy.
Additionally, strong holiday retail sales, a robust services sector PMI, and improvement in manufacturing PMI and durable goods orders reflect a strong economy. A solid Main Street will support the Wall Street rally despite sticky inflation and short-term fluctuations.
These little-known stocks have strong earnings and revenue growth potential for 2025. Moreover, they have seen positive earnings estimate revisions for 2025 in the last 60 days, indicating that market participants are expecting strong business from them this year. Each of our picks currently carries a Zacks Rank #1 (Strong Buy) or 2 (Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.
UiPath Inc.
Zacks Rank #1 UiPath provides an end-to-end automation platform that offers a range of robotic process automation solutions primarily in the United States, Romania, the United Kingdom, the Netherlands, and internationally. PATH offers a suite of interrelated software to build, manage, run, engage, measure, and govern automation within the organization.
The PATH platform's embedded AI, ML (machine learning), and NLP (Natural Language Processing) capabilities improve decisioning and information processing. PATH introduced new generative AI features, including specialized LLMs (Large Language Model) such as DocPATH and CommPATH, and Context Grounding, to enhance automated AI models for specific business needs.
UiPath has an expected revenue and earnings growth rate of 11% and 3.5%, respectively, for the current year (ending January 2026). The Zacks Consensus Estimate for current-year earnings has improved 6.7% over the last 60 days. The average short-term price target of brokerage firms represents an increase of 19.5% from the last closing price of $12.83.
Five9 Inc.
Zacks Rank #2 Five9 provides intelligent cloud software for contact centers in the United States, India, and internationally. FIVN offers a virtual contact center cloud platform delivering a suite of applications that enable the breadth of contact center-related customer service, sales, and marketing functions.
FIVN’s platform comprises interactive virtual agents, agent assist, workflow automation, workforce engagement management, AI insights, and AI summaries. It allows managing and optimize customer interactions across voice, chat, email, web, social media, and mobile channels directly or through its application programming interfaces.
FIVN saw its subscription revenues increase by 20% in third-quarter 2024, with total revenues up 15%. FIVN posted an adjusted EBITDA margin of 20%, helping it produce an operating cash flow of $41 million. Management raised its outlook for 2025.
Five9 has an expected revenue and earnings growth rate of 10.4% and 8.4%, respectively, for 2025. The Zacks Consensus Estimate for 2025 earnings has improved 3.6% over the last 60 days. The average short-term price target of brokerage firms represents an increase of 38.1% from the last closing price of $37.84.
Innodata Inc.
Zacks Rank #1 Innodata operates as a global data engineering company in the United States, the United Kingdom, the Netherlands, Canada, and internationally. INOD operates through three segments: Digital Data Solutions (DDS), Synodex, and Agility.
The DDS segment engages in the provision of AI data preparation services, collecting or creating training data, annotating training data, and training AI algorithms for its customers, as well as AI model deployment and integration services. DDS also provides a range of data engineering support services, including data transformation, data curation, data hygiene, data consolidation, data extraction, data compliance, and master data management.
INOD is focused on supporting Big Tech companies in developing generative model models. This strategy paid off in third-quarter 2024 as the company generated revenues of $30.6 million from a single Big Tech customer.
Innodata has an expected revenue and earnings growth rate of 34.6% and a negative 5.1%, respectively, for 2025. The Zacks Consensus Estimate for 2025 earnings has improved 15.5% over the last 60 days. The average short-term price target of brokerage firms represents an increase of 30% from the last closing price of $33.43.
Fastly Inc.
Zacks Rank #1 Fastly provides infrastructure software offering cloud computing, image optimization, security, edge computer technology and streaming solutions. On Dec.16,2024, FSLY unveiled Fastly AI Accelerator, a semantic caching solution that allows developers to optimize their LLM (large language model) generative AI applications.
FSLY operates an edge cloud platform for processing, serving, and securing its customer's applications in the United States, the Asia Pacific, Europe, and internationally. FSLY’s Edge Cloud Platform offers more efficient performance as developers need only a single line of code instead of repeated call to the AI provider to update their application to a new API endpoint.
Fastly has an expected revenue and earnings growth rate of 7% and more than 100%, respectively, for 2025. The Zacks Consensus Estimate for 2025 earnings has improved 50% over the last 60 days.
The company has a P/S ratio of 2.33X compared with 4.04X of the industry and 2.95X of the S&P 500. FSLY has a P/B ratio of 1.28X compared with 3.37X of the industry and 3.42X of the S&P 500.
Jabil Inc.
Zacks Rank #2 Jabil has been benefiting immensely from healthy momentum in the data center infrastructure, cloud, and digital commerce end markets. A large-scale portfolio of business sectors offers JBL a high degree of resiliency during times of macroeconomic and geopolitical disruption.
JBL’s high free cash flow indicates efficient financial management practices, optimum utilization of assets, and improved operational efficiency. Massive application of generative AI is set to drastically increase the efficiency of JBL’s automated optical inspection machines for automation industry.
Jabil has an expected revenue and earnings growth rate of -5.4% and 3.2%, respectively, for the current year (ending August 2025). The Zacks Consensus Estimate for current-year earnings has improved 0.9% over the last 30 days.
The company has a P/E ratio of 17.57X compared with 20.47X of the industry and 17.63X of the S&P 500. JBL has a P/S ratio of 0.63X compared with 0.63X of the industry and 2.95X of the S&P 500.
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Past performance is no guarantee of future results. Inherent in any investment is the potential for loss. This material is being provided for informational purposes only and nothing herein constitutes investment, legal, accounting or tax advice, or a recommendation to buy, sell or hold a security. No recommendation or advice is being given as to whether any investment is suitable for a particular investor. It should not be assumed that any investments in securities, companies, sectors or markets identified and described were or will be profitable. All information is current as of the date of herein and is subject to change without notice. Any views or opinions expressed may not reflect those of the firm as a whole. Zacks Investment Research does not engage in investment banking, market making or asset management activities of any securities. These returns are from hypothetical portfolios consisting of stocks with Zacks Rank = 1 that were rebalanced monthly with zero transaction costs. These are not the returns of actual portfolios of stocks. The S&P 500 is an unmanaged index. Visit https://www.zacks.com/performance for information about the performance numbers displayed in this press release.
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