Wall Street Faces Challenges Amid AI Stock Rally Correction

Market turmoil hits Wall Street as the tech sector falters. The report highlights how AI stock valuations have led to investor concerns and suggests five non-tech stocks with promising growth potential.

Date: 15-03-2025

AI Rating: 7

Market Overview
Wall Street's recent bull run showed signs of strain as the tech-heavy Nasdaq Composite entered a correction phase, predominantly due to the disappointing performance of AI-centric stocks. Concerns regarding the overvaluation of these stocks, the prospect of a recession, and interest rate uncertainties have contributed to the malaise. Despite this, certain non-tech stocks leveraging AI technology show promise for investors.

PayPal Holdings Inc. (PYPL)
PayPal's growth is underpinned by increased total payment volume and improved customer engagement. It has an expected revenue growth rate of 3.7% and an earnings growth rate of 8%. The Zacks Consensus Estimate for current-year earnings has increased by 2.4%. Furthermore, its return on equity (ROE) stands at 23.67%, outperforming its industry (13.71%) and the S&P 500 (17.11%).
Rating: 7

Visa Inc. (V)
Visa's strategic moves have positioned it for long-term growth, anticipating net revenue growth in low double-digits for fiscal 2025. It shows robust earnings growth of 12.4%. The Zacks Consensus Estimate for the latest earnings has increased by 0.7%. Visa's impressive ROE is 54.79%, significantly higher than the industry average.
Rating: 8

Upstart Holdings Inc. (UPST)
Upstart is experiencing remarkable growth with expected revenue growth of 59.3% and earnings growth exceeding 100%. The Zacks estimate for current-year earnings has surged beyond 100% recently.
Rating: 8

Netflix Inc. (NFLX)
Netflix is utilizing AI to enhance user engagement, with expected revenue growth of 14% and earnings growth of 24%. Its ROE stands out at 38.32%, well above the industry average.
Rating: 7

Johnson Controls International plc (JCI)
While JCI's expected revenue and earnings growth rates are negative at -11.9% and -1.9% respectively, it remains an attractive investment with significant upside potential nevertheless.
Rating: 5

Stocks: PYPL V UPST NFLX JCI