With the artificial intelligence boom showing no signs of cooling off, investors are eyeing top AI stocks that are garnering strong buy ratings.
The potential of the global AI market is vast, with projections indicating exponential growth. Estimated to be at $228.3 billion by 2026, the market could soar to $1.81 trillion by 2030, setting the stage for significant industry expansion. An emerging trend suggests that AI-related expenditures will constitute a notable 8% to 10% of IT budgets come 2024.
As tech giant Apple plunges into the AI realm with an impressive array of new AI features, the interplay between AI and various sectors becomes increasingly apparent. Industries ranging from real estate investment trusts to utility companies are witnessing the transformative impact of AI technologies.
In this era of burgeoning AI opportunities, several stocks stand out as compelling investment choices. Let’s delve into three AI stocks that have been receiving strong buy ratings.
Nvidia (NVDA)
Nvidia (NVDA), a powerhouse in the AI sector, presents as a top contender for investors. Following a 10:1 split, this industry giant is trading at $130, poised for potential growth. Analysts from Susquehanna predict NVDA could reach $160 per share, while Rosenblatt analysts have set a bullish target of $200, with even loftier projections aiming at $1,000 in the long term. This impressive trajectory can be attributed to the robust demand for Nvidia’s AI chips.
Noteworthy financial performance underscores Nvidia’s strength, with soaring revenue and earnings in recent quarters. Buoyed by strong guidance and optimistic metrics, NVDA remains an attractive prospect for investors in the AI space.
Advanced Micro Devices (AMD)
Despite facing challenges, Advanced Micro Devices (AMD) emerges as another standout AI stock with high ratings. Projections place a 12-month average price target at $191.03, with upward estimates reaching $235 per share. Notable endorsements from analysts at Citi and Edward Jones further bolster AMD’s appeal in the AI landscape.
A buoyant outlook for AMD is reinforced by forecasts of increased AI chip sales, showcasing the company’s readiness to capitalize on the burgeoning AI market. Investors are advised to view any dips in AMD’s stock price as viable long-term investment opportunities.
Micron (MU)
Micron (MU) earns a consensus strong buy rating, with an average price target of $153.65 and a high target of $225. Recent accolades from Bank of America and UBS further underscore the stock’s appeal. Insights from Cantor Fitzgerald hint at positive upcoming developments in Micron’s AI-related offerings, coinciding with the surge in demand for high-bandwidth memory products driven by the AI boom.
Despite a notable price surge, caution is advised for potential investors eyeing Micron, as indicators suggest an overheated market awaiting a corrective pullback. Patient investors awaiting a more opportune entry point may find Micron an attractive long-term prospect.
Investors are encouraged to conduct thorough research and consider the evolving landscape of AI technologies when contemplating investment decisions within this dynamic sector.