Morgan Stanley: Strong Momentum in Generative AI by 2025, Lists MongoDB (MDB.US) as "Preferred"

MongoDB (MDB.US) has been rated as the "top choice" for generating artificial intelligence prospects in 2025 by Morgan Stanley, but Fortinet, Inc. (FTNT.US) has been removed from the "top choice" list for network security stocks due to its stock price increase at the end of 2024. Morgan Stanley analysts, led by Keith Weiss, stated in a report, "From a software analysis perspective, innovation driven by generative artificial intelligence will expand the range of work that can be automated by software, while the underlying input costs for software systemsdata costs, computing costs, and software development costsare decreasing. Increased capacity and decreased input costs are laying the foundation for a broad-based inflationary system, and investors may see momentum within that system start to recover in 2025." Morgan Stanley has a "overweight" rating for MongoDB with a price target of $350. MongoDB is a leading developer data platform that enables developers to build, modernize, and manage applications with software and data. Morgan Stanley noted, "With recent expectations reset, MongoDB will benefit from strong growth in net new applications accelerated by AI-driven code development, increasing cloud migration expectations, and customers desiring standardization with fewer vendors for integration opportunities amid the current pandemic-driven market share gains." The rise of generative artificial intelligence also makes network security a top priority for 2025. Weiss stated, "We believe that recent technological advancements (GenAI, public cloud) expanding the attack surface have created new product opportunities for protecting against AI and leveraging AI automation for security operations, with long-term favorable tailwinds intact." While Morgan Stanley believes Fortinet, Inc. can perform well in 2025, it has removed the "top choice" label. Weiss added, "Considering Fortinet, Inc.'s stock price has risen by 20% since last November, we are removing it from the top choice list for security stocks, but we still have a positive view on the potential for upward revisions throughout the year." Other changes in the report include: Morgan Stanley upgraded Bill Holdings (BILL.US) from hold to overweight, with a price target raised from $95 to $105; downgraded Confluent (CFLT.US) from overweight to hold, with a price target lowered from $33 to $30. Upgraded DigitalOcean (DOCN.US) from hold to overweight, with a price target raised from $40 to $41.