In the wake of the 2023 surge in generative artificial intelligence (AI) services, the transformative impact of this technology has sparked debates about its potential to reshape the world forever.
Dubbed by some as the most significant revolution since the advent of the internet, AI’s impact has translated into unprecedented growth opportunities for companies immersed in its development. Notably, Nvidia (NASDAQ: NVDA) emerged as a stellar example of this trend last year.
With substantial investments and a relentless pace of expansion in the AI sector, the stage is set for more companies to ride the wave of exponential growth. In this January 12 article, we delve into two stocks with the potential to prosper in the evolving landscape.
Picked for you
AMD (NASDAQ: AMD)
Chipmakers play a vital role in the ongoing AI boom, and AMD is one of the world’s most prominent chipmakers.
Despite a stock price surge of more than 127% in 2023, analysts believe there is plenty of growth room for the company in 2024 and beyond. Recently, AMD announced its most powerful AI chip yet, MI300.
AMD’s CEO Lisa Su said the new product is equal to Nvidia’s H100 when it comes to training AI software and notably better at inference – the process of running that software for real-world applications.
The new chip is set to launch at some point this year and if successful, could serve as one of the primary catalysts for AMD’s shares.
Earlier this week, analysts at Melius Research upgraded their outlook for AMD from Hold to Buy and set the price target to $188, implying a potential upside of more than 27% from the current share price.
Alphabet (NASDAQ: GOOGL)
Though its cloud computing unit faced some growth challenges throughout 2023, Alphabet (NASDAQ: GOOGL) undoubtedly remains one of the prime candidates to lead the AI revolution in the years to come.
Several weeks ago, the tech behemoth unveiled Gemini, its largest and most advanced AI model yet.
It is widely expected that Gemini can significantly expand Alphabet’s presence in the AI market. Google’s owner claims that Gemini is the first AI model to outperform humans in certain subjects like math and physics. Additionally, it is able to understand reason and nuance.
Looking ahead, Alphabet intends to integrate Gemini into its Google Bard chatbot to enhance its planning and reasoning capabilities. Meanwhile, the company is also integrating generative AI features into key products such as Google Docs, Gmail, Pixel smartphones, smart home devices, and more.
All of these efforts bode well for Google’s lucrative cloud business.
In a note released on January 9, analysts at BMO Capital initiated coverage on GOOGL with an Outperform rating. The strategists set the price target on the stock at $170, suggesting a further upside of almost 20%.
Disclaimer: The content on this site should not be considered investment advice. Investing is speculative. When investing, your capital is at risk.