Increasing AI Spending in 2025 Leads Us to Buy More Shares of This Holding
We’re also keeping our eyes on these other portfolio positions.
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| Symbol | Transaction Type | # Shares Traded | Recent Price $ | Shares Owned After Trade | % Portfolio |
|---|---|---|---|---|---|
NOW | Buy | 13 | 1,058 | 110 | 2.35 |
After you receive this Alert, we will buy 13 shares of ServiceNow NOW at or near $1,058. Following the trade, NOW shares will account for roughly 2.35% of the portfolio.
We are taking advantage of the nearly double-digit pullback in NOW shares, which has brought them down close to their 50-day moving average at a time when corporate spending on AI in the coming year is expected to move higher. Findings from Information Services Group find enterprise leaders plan to increase spending on AI by an average of 5.7% in 2025, despite much more modest increases in overall IT budgets, and reinvest savings from cost optimization and productivity into AI-enabled transformation.
That expectation for higher AI spending this year is backed by findings from consulting firm E&Y:
“Surging artificial intelligence (AI) spending by business leaders is set to continue into 2025 as a near-unanimous 97% of senior business leaders whose organization is investing in AI report positive ROI from their AI investments, according to new data from Ernst & Young LLP. As a result, leaders remain bullish on their overall investments in AI with 34% of companies who are already investing in AI planning to invest $10 million or more next year, a directional increase from 30% six months ago in the first wave, but many report struggling to keep pace with rapid AI advancements.”
We continue to see ServiceNow well positioned for corporate AI adoption, which should also result in a positive mix shift for the company. We also see this adoption benefiting portfolio resident Elastic N.V. ESTC, and the current share price for those shares is favorable as well.
Once we’ve completed the trade, the portfolio’s cash position will be around 8% of its assets. This offers additional firepower to be opportunistic, at the same time we will continue to keep a close eye on the shares of Marvell Technology MRVL and Amazon AMZN. Both are approaching 4.5% of the portfolio’s assets, and further gains could mean we do some prudent register ringing.
(Please note that we are looking to execute these trades at or near the share price mentioned above. Once the trade is completed, subscribers can see the trade's executed price here. Be sure to toggle the chart to sort by Purchase Date.)
At the time of publication, TheStreet Pro Portfolio was NOW, ESTC, MRVL and AMZN.
