The Nasdaq Composite is struggling to find its footing in 2025. The index is down about 3.8% year-to-date and nearly 7.5% off its all-time high. A correction—defined as a 10% decline from recent peaks—may not be far off. But is this sell-off an opportunity? Some analysts say yes, pointing to beaten-down tech stocks like Advanced Micro Devices (AMD), Broadcom (AVGO), and Amazon (AMZN) as potential bargains.
AMD’s AI Ambitions Clash With Market Skepticism
AMD is in a rough spot. The semiconductor company has seen its stock price tumble 55% from its 2024 peak, weighed down by a slowdown in gaming and embedded chip sales. Investors weren’t thrilled with AMD’s forecast of a sequential revenue decline, either.
But is the pessimism overdone? Some believe so. Despite the headwinds, AMD’s overall business has been growing. Fourth-quarter revenue in 2024 surged 24% year over year to $7.7 billion, a significant acceleration from the 9% growth seen in Q2.
One factor fueling this optimism is AI. Companies looking for cost-effective AI processing solutions may turn to AMD’s accelerators, even if the company trails industry leader Nvidia. Meanwhile, AMD’s embedded segment appears to be stabilizing. Its annual revenue decline narrowed from 41% in Q2 to just 13% in Q4.
Still, gaming remains a problem. Revenue in that segment dropped 59% year over year. With major customers like Sony and Microsoft yet to launch new consoles, AMD’s gaming sales could stay weak for a while.
On the valuation front, the stock looks tempting. While its trailing P/E ratio sits at a lofty 102, its forward P/E has dropped to just 22—cheap for a high-growth chipmaker. If AI demand continues to rise and AMD regains its footing, this discount may not last.
Broadcom’s Sell-Off May Be a Long-Term Buying Opportunity
Broadcom’s stock has tumbled 27% from its recent highs, presenting what some see as an attractive entry point. The company’s strong foothold in AI infrastructure and its diversified revenue streams make it a standout even in a turbulent market.
One of Broadcom’s biggest strengths is its exposure to AI inference chips. These chips help companies apply AI models to real-world applications—a crucial component of the AI revolution. Broadcom has already secured deals with major AI hyperscalers and expects AI-related revenue to climb from $12.2 billion in 2024 to as much as $90 billion by 2027.
But Broadcom isn’t just an AI play. Its software business, which accounted for 42% of revenue in 2024, provides stability amid the volatility of the semiconductor sector. Analysts project Broadcom’s earnings to grow by 18% annually over the next few years, a solid rate for a company of its size.
For value-focused investors, Broadcom’s valuation also looks reasonable. The company’s price-to-earnings-growth (PEG) ratio now stands at 1.7—comfortably within the range where long-term investors typically find value.
Selling when stocks drop feels natural, but sometimes, it’s the worst thing an investor can do. Broadcom’s fundamentals remain strong, and for those with patience, the recent dip could be an opportunity.
Amazon’s Pullback: Another Chance to Buy?
Amazon has a history of bouncing back. Over the past three years, the stock has gone through five separate 15% pullbacks, only to recover and hit new highs each time. That pattern may repeat itself again.
This latest decline—just over 15% from Amazon’s all-time high—comes amid economic worries, tariff concerns, and shifting sentiment around AI stocks. Yet, the company itself remains largely unaffected.
Amazon’s core businesses are still going strong:
- E-commerce: The dominant online retailer continues to expand its reach.
- Cloud computing: AWS remains the clear leader in the cloud space.
- Advertising: A growing part of Amazon’s business that’s often overlooked.
During the steepest drop in late 2022, Amazon shares lost over 50% of their value. Investors who bought then have seen their holdings more than double. A $10,000 investment in early 2023 would be worth over $24,000 today.
Given Amazon’s track record and business strength, this latest dip could be yet another buying opportunity for those willing to wait.
