Investors looking for lucrative opportunities in the stock market are looking in the right direction. Tech stocks have significantly outperformed the broader market in recent years. For example, the Technology Select Sector SPDR ETF has the proceeds of the S&P 500 since 2019. Here are two stocks with near-term growth catalysts that you should buy now.

1. Dell Technologies

Dell Technologies (NYSE: DELL) Dell Inc. is widely known as a PC brand, but it is also a provider of storage, networking, and artificial intelligence (AI) solutions for data centers. Strong demand for AI servers has fueled Dell’s business this year, sending the stock to new heights. The momentum in Dell’s server business now makes the stock an attractive buy after its recent downturn.

Dell is still at the mercy of a sluggish PC market, where its client solutions group posted flat revenue growth in the fiscal first quarter of 2025, which ended May 3. That business accounts for the bulk of Dell’s total revenue, but its infrastructure group, which includes servers, saw a robust 22% increase year over year, helping the company’s total revenue rise 6% to $22 billion.

Dell’s strong order backlog for AI servers suggests it’s only just scratching the surface of this opportunity. Orders are up about 31% from the previous quarter to $3.8 billion, showing that AI servers are quickly scaling to become a significant revenue contributor.

The AI ​​server market is still in its infancy. Companies will continue to rapidly increase their investments in AI, as most leaders believe it will provide a competitive advantage. Furthermore, Dell has a large tailwind as spending on information technology continues to grow in line with the economy, which should benefit the entire company in the long run.

The reason the stock has fallen over the past month is that a higher sales mix of AI servers could put pressure on the company’s margins in the near term. Management expects adjusted earnings to rise about 7% this year, lower than full-year revenue growth of about 8%. But the important factor is that AI infrastructure solutions will be a long-term benefit to the company’s revenue and profits. That’s why Wall Street analysts currently expect Dell’s earnings to grow at an annual rate of 12% over the next several years.

Prospects for double-digit earnings growth are more than enough to send the stock higher. The stock looks downright cheap, with a forward price-to-earnings (P/E) ratio of 11, which is less than half of the S&P 500 average.

The story continues

2. Netflix

Netflix (NASDAQ: NFLX) Shares have risen since hitting a 2022 low. Subscriber growth has accelerated to a mid-teens percentage point as management ended password sharing and pushed more users to pay for subscriptions. But investors are still underestimating Netflix’s potential for margin expansion, profit growth and pricing power as it moves into live streaming content, particularly in the sports space.

Netflix has become a ubiquitous digital entertainment brand with 277 million global subscribers because it knows what its customers want to watch. The company is looking to improve its ability to retain those members, and that’s why it’s diving deeper into live content streaming.

Last year Chris Rock: Selective Outrage was well received by viewers, and that was just the beginning. The recent livestream of Tom Brady’s Roast was the biggest hit to date, but later this year Netflix could break its live viewership record again with two NFL games streaming on the service on Christmas Day.

At least one Wall Street analyst thinks live sports could be a catalyst for Netflix stock. Jefferies Analyst James Heaney believes a strong content offering could lead to the first price increase for the standard subscription in more than two years.

Regardless of what impact a potential price increase has on revenue next year, Netflix’s leap into live sports streaming would further cement its leadership position in digital entertainment and create all sorts of opportunities to attract more subscribers in the long run.

The consensus on Wall Street is that Netflix will grow its earnings at an annual rate of 27% over the next few years. That’s more than enough to justify a forward P/E of 37 for the stock. Even if the stock ultimately ends up with a lower P/E, that strong earnings growth could double the stock price within five years.

Should You Invest $1,000 in Dell Technologies Now?

Before you buy Dell Technologies stock, you should consider the following:

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John Ballard has no position in any of the stocks mentioned. The Motley Fool has positions in and recommends Jefferies Financial Group and Netflix. The Motley Fool has a disclosure policy.

2 Top Tech Stocks to Buy in August was originally published by The Motley Fool