Wolfe Research has outlined its top stock picks for the next 12 months, focusing on cloud computing, digital advertising and food delivery sectors. The firm’s selections include Amazon.com, Alphabet and DoorDash, citing structural growth drivers and valuation appeal.
Amazon.com (NASDAQ: AMZN) is highlighted for its Amazon Web Services (AWS) business, with Wolfe Research projecting low-40% growth in the third quarter and at least mid-40% in the fourth quarter. Full-year AWS growth is expected to reach high-30% year-over-year, supported by operational efficiencies, product mix shifts including AI tool Bedrock, and core business expansion. The retail segment is anticipated to grow in the low double digits, with margin expansion driven by internal cost efficiencies, advertising revenue growth and regionalization strategies. Amazon also plans to expand its Louisiana data center investment to $18 billion, adding a third campus to its existing facilities.
Alphabet (NASDAQ: GOOGL) is viewed favorably due to its Google Cloud Platform (GCP), with Wolfe Research expecting upside in revenue and margins supported by meaningful TPU sales projected for 2027 and 2028. The firm cites Alphabet’s fully vertically integrated value proposition, including leadership in Search, investments in Waymo, Anthropic and SpaceX, and YouTube as key strengths. A potential Gemini 4 launch is noted as a clearing event, though near-term risks around the launch could limit near-term stock movement. Valuation is described as reasonable at 23 times 2027 earnings per share. Recent developments include a custom silicon agreement with Marvell Technology and reports of YouTube in advanced talks with the NBA to create a streaming hub for local team broadcasts.
DoorDash (NYSE: DASH) is recommended for its second-quarter performance, which saw revenue reach $4.5 billion, a 36% year-over-year increase. Growth drivers include product initiatives, customer demand, grocery expansion, international market gains, improving unit economics, DashPass subscriptions, autonomous delivery, merchant integrations and advertising. Wolfe Research does not anticipate material increases in investments after 2026, as international, grocery and retail initiatives offset technology platform investments. Following the earnings report, multiple firms, including Susquehanna and UBS, raised their price targets on DoorDash stock.
