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2 Technology Stocks That Are Screaming Deals Right Now | The Motley Fool

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  Published in Science and Technology on Monday, October 27th 2025 at 4:55 GMT by The Motley Fool
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Two Technology Stocks Screaming Deals Right Now: An In‑Depth Look

In a market that has been dominated by cyclical swings, a handful of technology names continue to shine. On October 27, 2025, Motley Fool’s “2 Technology Stocks Screaming Deals Right Now” article cuts through the noise, spotlighting two companies that combine high growth potential with valuation discounts that are hard to ignore. The article not only explains why these two names are attractive, but also connects readers to deeper dives on the industry forces that support each company’s upside.

1. Microsoft (MSFT) – The Cloud‑First Champion

Why Microsoft Is Still a Deal

Microsoft’s cloud business has surged from a modest 2 % of revenue to nearly 70 % of its total earnings over the past decade. The article highlights that the company’s Azure platform now powers 45 % of the world’s AI workloads, giving it a commanding moat against competitors like Amazon Web Services (AWS) and Google Cloud. Key points include:

• Robust Growth Metrics: FY25 Q3 results showed a 17 % YoY increase in cloud revenue, with an operating margin that topped 35 %.
• Enterprise Stickiness: Over 90 % of Microsoft’s customer base has at least one subscription to its Office 365 or Dynamics 365 suites, ensuring recurring revenue streams that anchor the cloud lift.
• Balance‑Sheet Strength: The company posted a cash position of $120 billion, more than double its operating cash flow of $58 billion last year, giving it ample room to reinvest or return value to shareholders.
• Valuation Discount: At the time of the article, Microsoft was trading at a price‑to‑earnings ratio of 21.6x—below the industry average of 27x—yet the discounted cash flow model suggests a fair value closer to $410 per share, implying a 12–15 % upside.

Supporting Resources

Readers are directed to an in‑depth “Microsoft’s Cloud Dominance: Why It’s Not a Bubble” article that explains how the company’s hybrid‑cloud strategy (Azure Arc, Synapse) is positioned to capture the upcoming wave of digital transformation. A separate link explains how Microsoft’s AI strategy—through its Copilot suite integrated across Office, Power Platform, and Dynamics—creates a recurring revenue stream that is both high‑margin and defensible.

2. NVIDIA (NVDA) – AI’s Foundational Hardware

Why NVIDIA Is Still a Deal

NVIDIA’s GPU technology sits at the heart of every large‑language‑model (LLM) training run and inference engine. The article underscores that the firm’s stock price is now about 18 % below its 2024 all‑time high, offering a bargain for a company with a 3‑year compound annual growth rate (CAGR) of 35 % in data‑center revenue.

Key highlights include:

• Dominance in GPU Market: NVIDIA controls roughly 84 % of the professional GPU market and 70 % of the AI accelerator segment.
• Product Pipeline: The upcoming Hopper architecture promises 2.5× more performance per watt compared to Ampere, directly boosting data‑center profitability.
• Software Ecosystem: CUDA, the company’s developer platform, has over 200,000 active users, creating a network effect that locks in customers for years.
• Valuation: With a P/E ratio of 33x versus an industry average of 48x, the stock sits at a 22 % discount. Using the same DCF assumptions as Microsoft, the target price sits near $730, implying a 25–30 % upside.

Supporting Resources

To deepen understanding, the article links to “NVIDIA’s Hopper: The GPU That Will Fuel Tomorrow’s AI” – a technical walkthrough of the new architecture and its impact on inference costs. Another link directs readers to “The Economics of AI Hardware: Why GPU Companies Keep Rising” that explores how data‑center operators are willing to pay a premium for faster, cheaper inference.

Market Context and Risk Factors

While both companies are positioned for growth, the article emphasizes the broader market environment that can affect returns:

• Interest‑Rate Sensitivity: Tech stocks are inherently sensitive to rising rates. The article advises monitoring the Fed’s policy stance and its impact on discount rates used in DCF models.
• Supply‑Chain Constraints: Global semiconductor shortages could push up hardware costs for NVIDIA; however, its dominant position and scale help mitigate this risk.
• Regulatory Scrutiny: Antitrust concerns around Microsoft’s dominance in cloud and AI could potentially lead to fines or forced divestitures, albeit unlikely in the short term.
• Competition: Emerging AI hardware players such as AMD and Google’s Tensor Processing Units (TPUs) pose long‑term competition, though NVIDIA’s ecosystem remains unmatched today.

How to Invest in These Deals

The article offers practical investment guidance:

1. Dollar‑Cost Averaging: Given the volatility of high‑growth tech, spreading out purchases over 3–6 months can reduce entry‑point risk.
2. Diversified Portfolio Allocation: Allocate no more than 15 % of the portfolio to any single tech name, ensuring that a single under‑performance does not derail overall returns.
3. Stay Informed: Keep track of quarterly earnings, product launches, and macroeconomic headlines.

Motley Fool also provides a “Deal‑Alert” newsletter subscription, which delivers real‑time updates when these companies hit key valuation triggers.

Bottom Line

Both Microsoft and NVIDIA combine a compelling growth story with valuation discounts that, according to the article’s fundamental models, translate into substantial upside potential. Whether you’re a long‑term growth investor or a tactical trader looking for entry points in the tech space, these two names deserve a closer look. As always, thorough due diligence and a balanced approach to risk will help translate these “screaming deals” into real portfolio gains.