UBS’s top tech picks: Eight stocks with double-digit upside

How much longer can the AI investment boom run? UBS believes the cycle is still early and its highest-conviction stock ideas offer several ways to invest in what comes next.

The bank has identified its preferred stocks across its North American technology, media and telecommunications coverage, spanning cloud computing, semiconductors, software, digital advertising and payments.

“The common thread across the picks is a focus on stocks with unique growth drivers, attractive valuations, and the ability to capitalize on secular trends like AI, cloud, and digital transformation,” UBS writes.

The investment case rests partly on the gap between enthusiasm for AI and its deployment inside businesses. UBS reports that just 8% of surveyed enterprises have deployed AI agents at scale, suggesting substantial room for adoption.

But stock selection matters. Some companies stand to capture more spending, while others face customers consolidating suppliers and cutting existing IT budgets to fund AI projects.

Below are eight picks that illustrate UBS’s thinking, followed by the remaining six. All 14 carry Buy ratings, with price targets in US dollars. Implied upside figures are those quoted by UBS.

1. Amazon (NASDAQ: AMZN): The cloud growth story has further to run

UBS price target: US$318 | UBS implied upside: 28%

Amazon remains UBS’s preferred large-cap internet stock, with cloud computing central to the investment case.

The bank forecasts Amazon Web Services revenue growth of 47% in 2027, well ahead of consensus at 34%. It expects a growing order backlog and additional Trainium chip capacity to support that acceleration.

Profitability is another point of difference: UBS forecasts AWS operating margins of 47% in 2027, against the market’s 38%. Retail provides further support through faster delivery and market-share gains. The key test is whether contracted cloud demand converts into revenue as quickly as UBS anticipates.

2. Palantir (NASDAQ: PLTR): Can growth justify the valuation?

UBS price target: US$250 | UBS implied upside: 45%

Palantir’s appeal rests on exceptional growth translating into exceptional cash generation. UBS forecasts 88% revenue growth in 2026, compared with consensus at 83%, alongside adjusted operating margins in the low 60s. Its customer checks suggest strong demand and little evidence of material competitive pressure from AI model providers or rival data platforms.

Valuation remains the central debate: at roughly 53 times UBS’s estimated 2027 free cash flow in the report, substantial growth is already expected. Nevertheless, the bank believes the shares have become attractive relative to the opportunity.

“Palantir is at the nexus of the two most powerful spending trends in software – AI and data," UBS says.

3. Texas Instruments (NASDAQ: TXN): Earlier investment could now pay off

UBS price target: US$380 | UBS implied upside: 44%

Texas Instruments offers exposure to both a semiconductor recovery and expanding data-centre demand. UBS argues that investment made through the downturn has positioned the analog chipmaker to regain market share and meet improving demand.

As revenue rises against a relatively fixed cost base, more sales should flow through to profit and cash generation.

UBS forecasts 2028 free cash flow per share of US$16.19, compared with consensus at US$10.82. The opportunity depends on a sustained recovery, but the bank sees room for stronger growth than the market expects.

4. Celestica (NASDAQ: CLS): Supplying the infrastructure behind AI

UBS price target: US$430 | UBS implied upside: 36%

Canadian AI success story Celestica supplies networking and computing infrastructure to major cloud companies, putting it directly in the path of AI investment. UBS highlights its Ethernet switching business, work supporting Google’s AI programmes and an expected ramp in OpenAI-related infrastructure during 2027.

The bank forecasts earnings-per-share growth of 69% in 2027 and 51% in 2028. Yet its report values the shares at about 13 times its 2028 earnings estimate. Spending durability and the profitability of different customer programmes remain important variables, particularly as manufacturing investment increases.

UBS describes the valuation as “too cheap given the growth in our view”.

5. JFrog (NASDAQ: FROG): More AI-generated code needs more oversight

UBS price target: US$120 | UBS implied upside: 27%

JFrog offers a less obvious way to invest in AI adoption. Its software helps organisations store, secure and manage the components used to build applications. As AI tools generate more code, UBS expects demand for those services - and associated governance and security - to increase.

The bank forecasts revenue growth of 26% in 2027 and 23% in 2028, above consensus estimates of 18% in both years. Customer checks also suggest limited appetite to replace its products. At the report’s valuation of 47 times estimated 2027 free cash flow, continued strong execution matters.

“We believe JFrog is still an undervalued AI beneficiary," UBS says.

6. Pinterest (NASDAQ: PINS): The biggest upside on UBS’s list

UBS price target: US$33 | UBS implied upside: 76%

Pinterest offers the largest implied upside in UBS’s report. The bank sees better advertising tools, including an AI bidding system, helping the platform turn users’ shopping intentions into stronger advertiser returns. Broader adoption by smaller businesses could also diversify revenue.

This is an anticipated improvement rather than an acceleration already embedded in UBS’s annual forecasts: it expects 2026 revenue growth of 15.5%, slightly below 2025. Investment spending could constrain near-term margins, but UBS forecasts expansion in 2027 and 2028.

UBS believes Pinterest is “on the cusp of a revenue growth inflection point driven by its product development efforts”.

7. Spotify (NASDAQ: SPOT): More subscribers, more ways to monetise

UBS price target: US$690 | UBS implied upside: 24%

Spotify’s investment case combines subscriber growth with increasing revenue from each customer. UBS expects price rises, additional subscription tiers and paid extras to support growth, while advertising improvements and expansion into other audio categories lift profitability.

It forecasts operating margins of approximately 24% by 2030, compared with consensus at 21%. AI features developed alongside music labels could provide another catalyst. The challenge is to keep users engaged and paying as prices rise, while delivering the margin expansion UBS anticipates.

“We believe Spotify is well positioned to benefit from adoption of AI in music through its label agreements and large, engaged user base," the investment bank says.

8. Mastercard (NYSE: MA): A global payments powerhouse with room to grow

UBS price target: US$670 | UBS implied upside: 17%

Mastercard offers exposure to consumer spending alongside growth in newer payment services. UBS expects organic net revenue growth of around 10–12% over the medium term, broadly matching consensus.

Its valuation argument centres on what comes next: the bank calculates that the share price implies annual net revenue growth of just 4–6% between 2031 and 2040. New payment flows and value-added services could help sustain stronger growth, while a flexible cost base provides some protection if economic conditions weaken.

Consumer spending remains a key variable, but UBS sees multiple sources of growth.

The other UBS picks

Rounding out the list are SS&C Technologies (SSNC), where UBS highlights an “AI-enhanced data moat”; AT&T (T), supported by “wireless and fiber broadband subscriber growth”; EchoStar (ECHO), trading at what UBS calls a “sizable discount to net asset value”; TD SYNNEX (SNX), an “important manufacturing partner to hyperscalers building data centers”; Procore Technologies (PCOR), which UBS sees as “well positioned to benefit in a cyclical recovery”; and Global-e Online (GLBE), described as a “best-in-class provider of cross-border D2C eCommerce enablement”.

These ideas depend on different catalysts. Amazon and Celestica need cloud investment to translate into revenue; Palantir and JFrog need sustained software demand; Mastercard offers exposure to the continued expansion of digital payments.

UBS’s downside scenarios show what could happen if expectations disappoint. They include US$100 for Palantir, against its US$250 base-case target, and US$12 for Pinterest, against US$33. The upside figures are valuation estimates, not promised returns.

Editor's note: Price targets and implied upside use share prices at 15 September 2026 and have not been recalculated for publication on 29 September 2026.