Broadcom, Workday, monday.com among William Blair’s top 2025 picks

Investment firm William Blair is out with its top stock picks for 2025 and the list includes several tech companies, including Broadcom (NASDAQ:AVGO), Workday (NASDAQ:WDAY), Cloudflare (NYSE:NET), Pure Storage (PSTG) and monday.com (NASDAQ:MNDY).

Broadcom

There are a number of reasons why Broadcom is one of the firm’s top picks for next year, including the VMware acquisition, with integration said to be “ahead of plan,” analysts at the firm wrote.

“Broadcom’s industry-changing acquisition of VMware is performing better than expected for the company (grew revenue roughly 24% in the fiscal third quarter), as increased prices, forced bundling, and shift to subscription/SaaS licensing have greatly benefited VMware top-line’s growth,” the analysts wrote. “While many customers have been turned off by the acquisition, most larger organizations are feeling pressure to renew for another two to three years as they figure out how to migrate to alternatives—we suspect it will not be until 2026/2027 that we see meaningful churn in the VMware customer base.”

Broadcom also has “strong alignment” in its custom chip business, as evidenced by its recent quarterly results and the guidance that it could generate anywhere between $60B and $90B by 2027 from custom AI accelerators.

“With companies like Google … and Meta … having a deeply entrenched partnership with Broadcom (contributing nearly $10 billion in revenue in fiscal 2024), we expect steady growth within those existing customers going into 2025, as well as the incremental new revenue coming from new customers like Bytedance, OpenAI, and Apple,” the analysts added.

Other positives include Broadcom’s networking business; the diversification of its semiconductor business into non-AI markets; and “best-in-class profitability and shareholder returns.”

Key risks include the cyclicality of the semiconductor business, integration risks with VMware and the fact that Broadcom relies so much on Chief Executive Hock Tan.

Workday

There are a number of positives for Workday, including the belief that its initial guidance for fiscal 2026 is “achievable,” despite a recent slowdown.

“While Workday’s growth has decelerated over the past few years, we view fiscal 2026 as a year of stability with the company anticipating a slight acceleration in growth throughout the year on the back of a revenue recognition ramp-up for several large/strategic deals that have already been signed, increasing demand for its new AI solutions, and easier comps throughout the year,” the analysts said.

Other positives include changes the new management team could make that may contribute “more meaningfully in fiscal 2026;” and its software is believed to be “mission-critical,” as evidenced by its 98% gross retention rates.

The company should also benefit from increased activity in generative artificial intelligence and rising opportunities in the financial services solutions space.

Key risks include a slowdown in the macro space, a lack of traction in the financial space with enterprise customers, and market share concerns in the human capital management space.

Cloudflare

There are a number of positives for Cloudflare, including the belief it’s “well positioned” in AI, cybersecurity and edge computing.

“We believe the company has strong demand for its offerings, including R2, D1, durable objects, AI Gateway, Cloudflare Workers, SASE, and broader cybersecurity solutions,” William Blair’s analysts wrote. “In our view, Cloudflare’s use-cases are favorable for scalable, small language model applications and inference modeling where developers are looking for relatively low-cost, responsive, and scalable infrastructure. We believe Cloudflare is well positioned to capture early market share and potentially grow as these applications begin to evolve.”

Other positives include the possibility small language models could be used with Cloudflare’s technology and infrastructure capabilities (such as R2 and D1) to help train the models; a potential for re-acceleration in 2025 as sales capacity ramps up; and an ever-growing total addressable market.

Key risks include a still maturing sales organization; the fact many products were launched quickly and look to be a “work in progress” and the potential for edge compute markets taking longer to develop than first thought.

Pure Storage

There are a number of positives for Pure Storage, including a “strong technical moat,” as it is a pioneer in the all-flash storage market thanks to its DirectFlash Module technology, the analysts said. Its recent win with a hyperscaler is also seen as a “gamer changer,” as Pure Storage will provide all online storage for the company’s next-generation data centers, they added.

“While material contribution is not expected until calendar 2026/fiscal 2027 (we estimate 5%-10% of total Pure revenue given expectation of ‘double-digit exabytes’ of deployed storage), the deal underpins the large hard disk replacement opportunity within hyperscaler environments and augurs well for future design wins for Pure’s DFM technology,” the analysts wrote.

The company has also made share gains in the enterprise (outside the hyperscaler win) amid its ability to address various storage use cases, its products and its “strong channel partnerships,” the analysts added. Pure Storage should also see tailwinds from generative AI, including machine learning, inferencing and infrastructure modernization.

Key risks include heavy competition in the enterprise storage market, moving applications and data to the public cloud, the volatility in NAND pricing, revenue headwinds from its storage-as-a-service offering, near-term margin concerns and potential macro issues.

Monday.com

There are a number of positives for monday.com, including the fact it is “emerging” software platform.

“Monday.com takes a platform-first approach to its business, investing in infrastructure and core capabilities first, and then organically launching new solutions on top of its platform,” the analysts wrote. “Organic platform businesses are hard to find in software but tend to have good growth durability as all products built on the platform are typically well integrated, driving greater levels of upsell and cross-sell over time.”

Other positives include new products like its customer relationship software and Dev and its newest service products, all of which should be “generally available” by the end of the year. There’s also the potential net retention rates will increase next year; the company will get help from pricing next year; and it may move up market from the traditional small and medium-sized businesses it has sold to.

Key risks include slower-than-expected adoption of new products, as well as its exposure to small businesses, “which are more sensitive to macroeconomic conditions.”