Deutsche Bank analysts share their top stock picks in the tech sector for the remainder of the year

Digital Realty, a real-estate investment trust specialized in data centers, is benefiting from Big Tech's large-scale leasing.

The artificial-intelligence trade has moved beyond buying the biggest names or undifferentiated chip stocks.

Now, analysts are taking a closer look at specific parts of the hardware value chain, as well as the software platforms that are actually monetizing AI agents.

In the latest edition of Deutsche Bank's "Fresh Money" report for the fourth quarter of 2026, the bank highlighted nine investment ideas within the technology sector that touch upon these themes.

On the infrastructure side, data-center bottlenecks are creating massive pricing power for certain companies. Digital Realty (DLR), a real-estate investment trust that owns and develops data centers, is one of Deutsche Bank analyst Benjamin Soff's top picks.

Digital Realty will be a major beneficiary of the heavy AI spending from companies like Amazon (AMZN), Alphabet (GOOGL) (GOOG), Meta (META) and others, Soff wrote. He pointed out that Digital Realty's backlog of future contracted revenue reached $1.4 billion in the most recent quarter thanks to "large-scale leasing activity."

Analysts are also looking at the hardware that goes inside the data center.

Optical components manufacturer Lumentum (LITE) is capitalizing on severe supply shortages as demand for data-center optics far outpaces industry capacity. According to analyst Gianmarco Paolo Conti, Lumentum's advanced 200G lasers are "sold out for the foreseeable future," commanding roughly double the average selling price of previous-generation equipment.

Cadence Design (CDNS), which provides design software for electronic systems, is expanding its market share by selling to both traditional semiconductor clients and non-semiconductor firms entering chip design. The company is likely to be a continuing "double-digit grower," Conti wrote.

Another top pick is Entegris (ENTG), the leading supplier of advanced materials for high-tech end markets such as life sciences and semiconductors. Roughly 75% of its revenue is tied to chip production volume, according to analyst Melissa Weathers. A global buildout in chip manufacturing is likely to drive Entegris' chip-related sales above their previous $850 million peak, Weathers added.

Beyond hardware, Deutsche Bank highlighted consumer and enterprise platforms that are successfully charging for AI. The widespread popularity of Meta's Muse AI agent could be just the beginning of a robust product cycle, analyst Benjamin Black wrote.

Black noted that strong early adoption of Muse opens up direct monetization channels through subscriptions and transaction fees, while simultaneously boosting conversion rates across Meta's core advertising platform.

E-commerce giant Shopify (SHOP) (CA:SHOP) is similarly leaning in to AI, partnering with Meta to allow easy integration of Muse on its platform. The company's own AI assistant, Sidekick, represents an underappreciated catalyst that could soon pay off for investors. Analyst Bhavin Shah expects Shopify to monetize Sidekick by raising prices across its core subscription tiers over the next several quarters, helping sustain 20%-plus revenue growth.

Real estate marketplace platform Compass (COMP) is also using AI to emerge more profitable from a residential housing downturn. The company is offering AI tools to serve higher-end buyers who are less sensitive to elevated mortgage rates. Deutsche Bank expects Compass to capture roughly $940 billion in transaction volume in 2026.

For investors looking beyond traditional tech names, Deutsche Bank also highlighted media giant SiriusXM $(SIRI)$ as a surprise digital growth play. Analysts point to a newly formed digital audio advertising partnership with YouTube as an underappreciated catalyst that could generate roughly $1.5 billion in revenue between 2026 and 2028. That's six times as much as the $250 million currently reflected in Wall Street consensus models.

Lastly, the cloud over software stocks appears to be lifting with the inclusion of ServiceNow (NOW) as a top pick. The software company is seeing enterprise AI adoption spark demand for upgrades to its core IT Service Management platform, according to analyst Brad Zelnick. The company's AI Control Tower and cybersecurity offerings are also of increasing importance as enterprises look to govern their AI agents.

-Christine Ji