In this piece, we discuss the 14 Best IT Stocks to Buy for the Long Term.

Following a massive rally driven by artificial intelligence, U.S. technology stocks finally show their first signs of fatigue. The sector has surged more than 50% since April, significantly higher than the broader S&P 500’s gain. However, recently, the sector stumbled as investors shifted their focus from the seasonally choppy market to secure their profits. Amid the uncertainty ahead of Federal Reserve Chair Jerome Powell’s speech at the Jackson Hole symposium, investors are worried that too much money is concentrated in AI-related stocks. Accordingly, the Nasdaq, which is heavy in tech stocks, is down about 2% in the past week, driven by large declines in tech giants, such as Nvidia and Palantir.

Here, investors are questioning whether AI enthusiasm has gotten ahead of fundamentals. Tech stocks have become very expensive, with the sector trading near 30 times forward earnings, which is the highest level in a year. Furthermore, an MIT study reports that most companies are seeing little to no returns from AI investments. Even Sam Altman, OpenAI’s CEO, advised caution, suggesting AI stocks might be overvalued.

Yet analysts see this as a natural cooling-off rather than a collapse of the AI growth story. Investors are shifting their attention to identifying the best IT stocks that demonstrate resilience amid short-term volatility while returning sustainable growth in the long term.

With this backdrop in mind, we will now shed light on the 14 Best IT Stocks to Buy for the Long Term.

Our Methodology

To curate our list of the 14 Best IT Stocks to Buy for the Long Term, we used the Finviz screener to extract a list of IT stocks with over 20% revenue growth in the past five years. Next, we ranked those stocks in ascending order based on the number of hedge funds holding stakes in each stock as of Q1 2025. We assessed hedge fund ownership of each stock using Insider Monkey’s hedge fund database, which tracks over 1,000 hedge funds.

Why are we interested in the stocks that hedge funds pile into? The reason is simple: our research has shown that we can outperform the market by imitating the top stock picks of the best hedge funds. Our quarterly newsletter’s strategy selects 14 small-cap and large-cap stocks every quarter and has returned 373.4% since May 2014, beating its benchmark by 218 percentage points (see more details here).

14. Palo Alto Networks, Inc. (NASDAQ:PANW)

5-Year Revenue Growth: 22.03%

Number of Hedge Fund Holders: 77

With strong revenue growth and significant hedge fund interest, Palo Alto Networks, Inc. (NASDAQ:PANW) secures a spot on our list of the 14 Best IT Stocks to Buy for the Long Term.

On August 19, 2025, Truist Securities increased its price target on Palo Alto Networks, Inc. (NASDAQ:PANW) from $205 to $220, maintaining a ‘Buy’ rating. This price revision follows the company’s strong fiscal Q4 results. The quarter experienced revenue growth of 15.8% YoY, surpassing analyst estimates, thanks to solid performances in SASE, XSIAM, and virtual firewalls. Furthermore, the gross margin stood at 73.6%, while levered free cash flow hit $3 billion.

Palo Alto Networks, Inc. (NASDAQ:PANW)’s strong quarterly performance was led by key growth drivers, including 32.2% NGS ARR growth and 24% RPO growth, both exceeding expectations. Moreover, the company reported encouraging FY2026 guidance, bolstering investor confidence. Meanwhile, Truist highlighted the company’s progress toward its ambitious $15 billion ARR target by 2030, driven by AI and identity-driven solutions.

With platforms such as Prisma Access, Prisma Cloud, Strata Cloud Manager, and virtual firewalls, Palo Alto Networks, Inc. (NASDAQ:PANW) delivers cybersecurity solutions across network, cloud, and hybrid environments. It is one of the best IT stocks.

13. Palantir Technologies Inc. (NASDAQ:PLTR)

5-Year Revenue Growth: 30.73%

Number of Hedge Fund Holders: 77

Palantir Technologies Inc. (NASDAQ:PLTR) is one of the 14 Best IT Stocks to Buy for the Long Term.

On August 5, 2025, Cantor Fitzgerald raised its price target on Palantir Technologies Inc. (NASDAQ:PLTR) from $110 to $155, maintaining a ‘Neutral’ stance, following the company’s record-breaking Q2 2025 results.

For the quarter, Palantir Technologies Inc. (NASDAQ:PLTR)’s U.S. Commercial segment exceeded Street estimates by 15%, driving the management’s projected sustained 90% growth despite challenging comparisons ahead. Despite international commercial revenue slipping for a second straight quarter, the investment firm highlighted the company’s growing U.S. focus, which will now comprise nearly 80% of revenue by 2026, up from previous estimates of 75%.

Palantir Technologies Inc. (NASDAQ:PLTR) achieved record contract value bookings and a “Rule of 94” (the company’s key metric combining revenue growth and profitability) in Q2. Looking ahead, the company reported guidance of a “Rule of 95” for Q3 2025, and a “Rule of 91” for the full year.

Palantir Technologies Inc. (NASDAQ:PLTR) enables intelligence, counterterrorism, and data-driven decision-making with its advanced software platforms. It is one of the best IT stocks.

12. Shopify Inc. (NASDAQ:SHOP)

5-Year Revenue Growth: 36.93%              

Number of Hedge Fund Holders: 77

With strong revenue growth and significant hedge fund interest, Shopify Inc. (NASDAQ:SHOP) secures a spot on our list of the 14 Best IT Stocks to Buy for the Long Term.

On August 7, 2025, JPMorgan raised its price target on Shopify Inc. (NASDAQ:SHOP) from $115 to $179, maintaining an ‘Overweight’ rating. This price revision reflects the company’s strongest growth trends since the pandemic.

For Q2 2025, Shopify Inc. (NASDAQ:SHOP) reported a surge in its Gross Merchandise Volume and Gross Payment Volume segments, while its notional volume growth hit a record high. JPMorgan noted that consumer demand remained unaffected by tariffs, and the company’s volume growth was driven by price increases by some merchants.

Looking ahead, Shopify Inc. (NASDAQ:SHOP) projected over 20% gross margin growth in Q3, along with expanding free cash flow margins, beating Street expectations.

With its commerce technology solutions, Shopify Inc. (NASDAQ:SHOP) helps merchants globally manage sales, payments, fulfillment, analytics, and financing across digital and physical retail channels. It is one of the best IT stocks.