Important points
Dan Ives said that despite “growing dissatisfaction” among many investors about Europe’s ability to incubate high-tech companies, some investors were bullish on the continent. German software giant SAP, chip equipment supplier ASML, buy-now-pay-later Klarna and music streaming platform Spotify are key European stocks to watch, Wedbush Securities’ global head of technology research told CNBC. Europe’s public markets have recently faced criticism from founders and investors as domestic tech companies increasingly look across the Atlantic to realize their public market ambitions. Ives said the continent was facing a “testing moment” over its ability to compete as a technology hub. “I travel a lot around Europe and there’s a growing frustration because investors are looking at what’s going on around the world and being like, ‘What about us?'” he said. Despite the challenges, these are the prospects for the four European tech companies Mr. Ives is keeping an eye on, analysts said. SAP German software giant SAP’s stock price is expected to fall 11.4% in 2025, but analysts see significant upside potential. Analysts have a price target of 286.42 euros ($335.84) for the company’s stock, representing an upside of 35.9%, according to consensus compiled by LSEG. Bank of America said in a note earlier this month that SAP is one of its “25 Stocks of 2026.” “In 2026, we expect SAP to see traction with its AI products and support commercial momentum while delivering further operational efficiencies,” the magazine wrote. “Some of the work that SAP is doing is clearly great,” Ives says. ASML Inventories of ASML, a Dutch semiconductor equipment supplier that makes the complex photolithography equipment essential to making cutting-edge chips, are up 38.6% so far this year. Analysts have set a price target of 2.6% higher at 972.44 euros ($1,140.22), according to LSEG data. Bank of America analyst Didier Chemama said earlier this month that the company is a top contender in the semiconductor space and one of the top candidates for 2026. He expects ASML’s gross margin to expand in 2027. “ASML is a central player in terms of AI,” Ives said. Klarna Klarna’s share price has fallen 19% since listing on the New York Stock Exchange in September, but analysts are targeting significant upside. Analysts have a price target of $45.63, representing a 41.1% premium to today’s price, according to LSEG data. In November, the buy now, pay later company beat Wall Street’s third-quarter revenue expectations in its first earnings report since going public. At the time, Klarna said it was being boosted by strong growth in the United States. Spotify Spotify stock rose 33.9% in 2025. The music streaming company reported strong third-quarter results that beat Wall Street expectations, with total revenue up 12% year-over-year in November. Analysts have set a price target of $754.87, an increase of 26.1%, according to LSEG data. In a late November note, Deutsche Bank predicted that Spotify could raise subscription prices in 2026, adding that this could result in a 5% increase in revenue.
