Artificial intelligence, and the resulting global AI race, has been a dominant investing theme. Companies are pouring billions into developing cutting-edge artificial intelligence models and infrastructure. However, the landscape shifted dramatically at the end of January when Chinese startup DeepSeek announced that it developed AI models nearly on par with American rivals, despite using inferior chips and less data. This triggered a global selloff in the tech sector as questions arose about the lofty valuations of AI-related stocks and Silicon Valley’s business model, which relies heavily on extensive research and development spending.
However, while some investors were hitting the panic button, Bank of America noted that the pullback created unique buying opportunities in certain stocks. The firm spotlighted Corning (GLW), Hewlett Packard Enterprise Company (HPE), Western Digital Corporation (WDC), and Seagate Technology Holdings (STX), pointing out that “each name has compelling growth drivers separate from Gen AI/datacenter spending.” BofA also pointed to Apple (AAPL) and International Business Machines (IBM), citing their defensive characteristics and potential for growth amid market volatility. With that, let’s have a closer look at these stocks.
Stock to Buy #1: Corning
Corning (GLW) manufactures highly engineered products utilizing glass science, ceramic science, and optical physics. The company boasts a history of over 170 years and supplies products to a range of industries, including telecommunications, display technologies, environmental and life sciences, and specialty materials. Its market cap currently stands at $44.5 billion.
Notably, GLW is experiencing solid momentum around AI and data center-driven demand. The company’s Optical Communications segment stood out in the most recent quarter, delivering 51% year-over-year sales growth to $1.4 billion. This was fueled by record sales in the Enterprise portion of the business, which saw a 93% increase, propelled by continued strong adoption of Corning’s new Gen AI products. With that, the company is well-positioned to continue growing this segment thanks to its leading fiber optic solutions that are tailored to generative AI requirements.
Shares of the company that specializes in specialty glass, ceramics, and related materials have rallied 58.5% over the past 52 weeks.
Meanwhile, Corning was not spared from the Jan. 27 selloff, with the stock dropping more than 8%. Still, analysts at BofA noted that the company has multiple key catalysts that could support recovery and drive further growth. These include the cyclical recovery in its Optical business, the ramp-up of the Lumen/Broadband Equity, Access, and Deployment program, opportunities in the Solar sector, consistent profitability in the Display segment, and its upcoming Investor Day on March 18.
Overall, Wall Street analysts are optimistic about Corning, assigning the stock a “Moderate Buy” consensus rating. HSBC analyst Stephen Bersey recently upgraded Corning to “Buy” from “Hold” and boosted the firm’s price target on the stock to $60 from $51 following upbeat fourth-quarter results. Out of the 12 analysts covering the stock, eight recommend “Strong Buy,” and four give a “Hold” rating. The mean target price for GLW stock is $56.77, which is 9% above Friday’s closing price.
Stock to Buy #2: Hewlett Packard Enterprise Company
Hewlett Packard Enterprise Company (HPE), with a market cap of $27.9 billion, is a global information technology company. HPE’s core product is its server offerings, but it also has other important product verticals, including Intelligent Edge, a computing solution that facilitates data processing and analysis at source, as well as Hybrid Cloud services and financial services.
HPE is well-positioned for growth in 2025. The company will likely see sustained strength in Server sales, driven by demand for AI servers alongside the next refresh cycle for general computing. Also, Intelligent Edge could return to growth this year as customer inventories improve. In addition, HPE’s innovations, such as liquid cooling for data centers and AI systems, have the potential to drive significant growth in the upcoming quarters.
Shares of the IT giant have climbed 34.2% over the past 52 weeks.
HPE stock slid more than 5% last Monday. BofA said that its acquisition of Juniper Networks and cost-cutting efforts could enhance the company’s margins, potentially improving its bottom line. Also, analysts led by Wamsi Mohan noted that “AI server exposure is not embedded in the valuation multiple.”
Overall, Wall Street analysts have deemed HPE stock a “Moderate Buy,” with a mean target price of $24.50, which indicates solid upside potential of 15.6% from the Jan. 31 closing price. Among the 15 analysts offering recommendations for the stock, seven recommend a “Strong Buy,” one gives a “Moderate Buy” rating, and the remaining seven advise holding.
Stock to Buy #3: Western Digital
Valued at a market cap of $22.5 billion, Western Digital Corporation (WDC) is a prominent developer and provider of data storage solutions. It operates in the data storage industry, offering a wide range of products, including hard disk drives (HDDs) and solid-state drives (SSDs), for various applications. These applications span from personal computing and gaming consoles to mobile devices, as well as large-scale enterprise applications like cloud storage and artificial intelligence workloads.
Shares of the data storage and memory maker have risen 10.1% over the past 52 weeks.
WDC stock dropped over 4% last Monday. BofA views WDC’s expected spinoff as a value-enhancing move for long-term investors. The firm estimates potential value creation of between $5 billion and $10 billion. Notably, BofA analysts also point to SanDisk Analyst Day (Feb. 11) and Western Digital Analyst Day (Feb. 12) as major catalysts.
For those unfamiliar with the company’s plans, it is preparing for a major spinoff to separate its two primary segments: Flash and HDD. Flash has traditionally been the better area of storage chips. However, increased supply from competitors as well as weaker upgrade rates in various consumer devices such as personal computers and smartphones have led to weaker flash pricing. At the same time, the HDD segment is experiencing rising average selling prices (ASPs), supported by enterprise demand for affordable HDD storage to power AI models.
Wall Street analysts are overwhelmingly positive about Western Digital’s future, as evidenced by a consensus “Strong Buy” rating. Out of the 21 analysts covering the stock, 15 recommend a “Strong Buy” and six assign a “Hold” rating. The average price target for WDC stock is $85.16, indicating notable upside potential of 30.8% from Friday’s closing price.
Stock to Buy #4: Seagate Technology Holdings
With a market cap of $20.4 billion, Seagate Technology Holdings (STX) offers data storage technology and infrastructure solutions. STX specializes in mass-capacity data storage products, including enterprise nearline HDDs and SSDs, as well as storage subsystems and scalable edge-to-cloud mass data platforms. Its products cater to a broad array of industries, from storing CCTV footage for security applications to managing hospitals’ medical records.
The rapid growth in data generation and AI projects drive demand for the company’s storage solutions, positioning it well for sustained long-term growth. Notably, Seagate experienced substantial demand growth from its cloud service provider customers (CSPs) in the most recent quarter. Mass capacity also saw strong demand from CSPs. Management anticipates that GenAI will drive future growth in mass capacity storage as AI consumers in the advertising and eCommerce sectors generate more data.
Shares of the storage company have gained 7.4% over the past 52 weeks.
STX stock dropped more than 4% last Monday and closed every trading session last week in the red. Meanwhile, BofA maintains a bullish stance on the stock, citing improvements in the HDD industry structure since the last downturn. The firm highlighted key growth drivers such as the company’s emphasis on advancing Heat-Assisted Magnetic Recording (HAMR) technology, which increases “gross margins through a higher mix of high-capacity/HAMR drives,” along with “continued data center spending (excluding AI).”
Wall Street analysts have a consensus rating of “Moderate Buy” on Seagate Technology stock. Notably, the company recently posted upbeat fiscal second-quarter results, featuring 50% year-over-year revenue growth and substantial margin expansion, fueled by high demand from CSPs. This led to a series of price target increases from Wall Street brokerages.
Out of the 20 analysts providing recommendations for the stock, 12 rate it as a “Strong Buy,” one advises a “Moderate Buy,” five suggest a “Hold,” and the remaining two give a “Strong Sell” rating. The mean price target for STX stock is $122.11, which suggests upside potential of 26.7% from Friday’s closing price.
Stock to Buy #5: Apple
Apple (AAPL) has consistently set the benchmark in the technology sector. With a lineup that includes flagship products like the iPhone, MacBooks, Apple Watch, AirPods, and iMacs, all integrated within the ecosystem of its highly profitable Services business, the company has become the most valuable in the world, boasting a gargantuan market cap of $3.55 trillion.
Shares of the iPhone maker have surged 23.5% over the past 52 weeks.
AAPL was one of the few technology stocks that ended in the green last Monday. “On a day when AI stocks were down double-digit percent, Apple shares were up 3% as investors realize the potential for edge AI and there is a flight to safety driven by Apple’s earnings resiliency,” BofA analysts led by Wamsi Mohan noted. The analysts added that edge AI applications and Apple, as the maker of edge devices, should benefit if DeepSeek can truly reduce the cost of AI inferencing, allowing for faster and cheaper development of better models. “We view Apple as the ultimate play on having an LLM in your pocket,” they said.
BofA identifies several potential catalysts for AAPL stock, including the anticipated launch of the iPhone SE in March or April, the insourcing of modem production to boost gross margins, the Worldwide Developers Conference in June which might showcase AI-driven use cases, and the release of the iPhone 17 in September 2025.
Wall Street analysts maintain a positive outlook on AAPL stock, awarding it a consensus “Moderate Buy” rating. The tech giant recently reported better-than-expected first-quarter results and offered reassuring FQ2 revenue guidance, prompting a wave of price target hikes from major investment banks, including Goldman Sachs, JPMorgan, Morgan Stanley, and Citi, among others.
Among the 36 analysts covering the stock, 16 recommend a “Strong Buy,” five rate it as a “Moderate Buy,” 11 suggest holding, one advises a “Moderate Sell,” and three give a “Strong Sell” rating. Notably, the stock trades close to its mean price target of $242.79 but has 37.7% upside potential to the Street-high price target of $325.
Stock to Buy #6: International Business Machines
International Business Machines (IBM) operates as an IT services and consulting company. Through its platform, IBM provides a wide range of solutions, including analytics, IT infrastructure, cloud, business operations and automation, cybersecurity, data storage, application development, asset management, blockchain, software, and consulting. Its market cap is currently $236.4 billion.
Shares of the IT giant have advanced 36.6% over the past 52 weeks.
IBM stock finished slightly lower last Monday. BofA identified catalysts for IBM, such as a new mainframe cycle, acceleration in its Software division, and increased activity in mergers and acquisitions. The analysts forecast higher growth in its Software segment over the next three years, fueled by Enterprise AI opportunities and the launch of a new Mainframe in 2025. “For IBM, AI represents an opportunity in its Consulting business as it seeks to position itself as the go-to partner of choice for AI consulting,” they said.
Wall Street analysts maintain a cautiously optimistic stance on IBM stock, as reflected in their consensus “Hold” rating. The company recently received positive feedback from the Street after reporting solid Q4 results and providing strong 2025 revenue growth guidance. Out of the 16 analysts covering the stock, four recommend a “Strong Buy,” one advises a “Moderate Buy,” nine suggest a “Hold,” and two assign a “Strong Sell” rating. The stock trades at a premium to its average price target of $230.94, with only 6% upside potential to the Street-high target of $271.
