In this article, we'll analyze whether Qualcomm (NASDAQ:QCOM) is the hottest artificial intelligence (AI) stock and take a closer look at the progress of the AI industry. To see more AI stocks with momentum, check out our free report. 7 Unstoppable Artificial Intelligence (AI) Stocks to Buy Now.
AI Bullish View
On April 20th, Matt Bryson, an enterprise hardware analyst at Wedbush, appeared in an interview. Yahoo Finance There, he discussed the key players in the AI industry and why interest rate cuts may have little impact on the tech wave. Tech stocks such as Advanced Micro Devices, Inc. (NASDAQ: AMD) and Intel Corporation (NASDAQ: INTC) have fallen 15% in the past 30 days, and the Philadelphia Semiconductor Index has fallen 10% despite previous highs. Despite the pullback in industry activity, Bryson remains bullish on artificial intelligence. Bryson highlights that the AI engine is fueled by chip stocks and cloud service providers, boosting NVIDIA Corporation (NASDAQ: NVDA), Advanced Micro Devices, Inc. (NASDAQ: AMD), and Amazon.com Inc (NASDAQ: AMZN). He added that despite the pullback, big tech stocks, especially chipmakers, will continue to invest in AI in 2025 and deliver strong growth results. Bryson suggests that high interest rates will certainly weigh on consumer spending in the long term, impacting high-multiple stocks such as the big chipmakers. He further noted that interest rates may have little or no impact on the fundamentals of technology and AI. Data center operators such as Microsoft Corp. (NASDAQ:MSFT) and Amazon.com Inc. (NASDAQ:AMZN) will continue to focus on developing AI applications, according to Bryson.
Bryson believes that NVIDIA Corporation's (NASDAQ:NVDA) Blackwell, a next-generation semiconductor product, will have a positive impact on the industry. He argues that while AI hardware and software companies will undoubtedly define the industry's success criteria, it is uncertain to predict AI technology developments at this point. Following NVIDIA Corporation (NASDAQ:NVDA), Bryson is also bullish on Taiwan Semiconductor Manufacturing Company Limited (NYSE:TSM), and is also bullish on Microsoft Corporation (NASDAQ:MSFT) and
Amazon.com Inc. (NASDAQ:AMZN) is developing its own semiconductor products, and Taiwan Semiconductor Manufacturing Co. Ltd. (NYSE:TSM) is shifting its market position. Bryson said it's hard to predict which sectors AI will infiltrate, though he expects the industry to grow.
Some developments in the field of AI
In a groundbreaking update, OpenAI released GPT-4o on May 13, a platform that can process voice, vision, and text in real time. This new application takes human-computer interaction to the next level. The application can respond to voice input and provide output in 232 milliseconds, compared to an average of 320 milliseconds. Not only does this new product complement GPT-4 Turbo's performance on English text and code, it is 50% cheaper and much faster. The tool also makes it easier to understand visual and voice input.
On May 20, Microsoft (NASDAQ:MSFT) unveiled the CoPilot+ PC, designed for artificial intelligence. The new PC is one of the most intelligent and fastest PCs ever. The new silicon can perform more than 40 trillion operations per second, has long battery life and is built with advanced AI models. Individuals with the new device can use Cocreation to generate and adjust images in real time and use the Live Captions tool to work in more than 40 languages. The PC will be available starting June 18.
Wall Street is bullish on Microsoft Corp. (NASDAQ:MSFT). On May 22, analyst firm Wedbush reaffirmed its Outperform rating for Microsoft Corp. (NASDAQ:MSFT) and maintained its target price at $500. Based on analysts' forecasts over the past three months, 32 Wall Street analysts have maintained a Buy rating on the company's stock, with an average target price of $491.23 and a maximum expected price of $600. The company's average target price represents an 11.88% increase from the current stock price of $427.25.
Now that we've discussed the latest trends in the AI space, let's take a look at the 7 Artificial Intelligence (AI) stocks that are unstoppable. You can also read our articles on the best AI stocks according to billionaire Steve Cohen and the best AI stocks to buy now according to billionaire Stanley Druckenmiller.
A close-up of a circuit board containing microchips that make up a powerful computing system.
Our Methodology
To select the 7 unstoppable artificial intelligence (AI) stocks, we considered four ETFs – iShares US Technology ETF, Fidelity MSCI Information Technology Index ETF, iShares Global Tech ETF, and iShares Expanded Tech Sector ETF – as well as rankings of AI companies and stocks. We compiled a list of 30 stocks and screened them with Finviz. We narrowed the sample to stocks that were up 35% or more YTD as of May 23, and selected the 10 stocks with the highest share price gains. Stocks are listed in ascending order of YTD gains.
We also added hedge fund sentiment towards each stock. Hedge fund data comes from Insider Monkey's database of 933 elite hedge funds as of Q1 2024. The top 10 hedge fund consensus stocks have outperformed the S&P 500 by more than 140 percentage points over the past decade (more here), which is why we pay close attention to this often-ignored metric.
Is QUALCOMM Incorporated (NASDAQ:QCOM) the most unstoppable AI stock to buy right now?
Qualcomm Inc. (NASDAQ:QCOM)
Year-to-date increase as of April 23: 40.31%
Number of hedge fund holders: 78
QUALCOMM Incorporated (NASDAQ:QCOM) is one of the must-buy AI stocks. This semiconductor company produces hybrid AI architectures that are applicable to most generative AI applications and devices, including mobile phones, laptops, XR headsets, automobiles, IoT, etc. QUALCOMM Incorporated (NASDAQ:QCOM) is involved in producing AI hardware, AI software, and AI algorithms.
On May 7, Argus Research maintained a Buy rating on Qualcomm Incorporated (NASDAQ:QCOM) and raised its price target from $180 to $205. The stock has been rated at a Buy level by 19 of the 28 Wall Street analysts who have covered the company in the past three months. As of May 20, the average price target for the stock is $187.91, with a maximum expected price of $220.
On May 5, Qualcomm Incorporated (NASDAQ:QCOM) announced its second quarter fiscal 2024 results. The company reported earnings per share of $2.44, beating expectations by $0.12. In addition, sales were $9.39 billion, beating the market consensus by $39.41 million, and posting a year-over-year sales growth rate of 1.27%.
In its fourth-quarter 2023 investor letter, Madison Investment Holdings Inc's Madison Sustainable Equity Fund said the following about QUALCOMM Incorporated (NASDAQ:QCOM):
“Qualcomm Inc. (NASDAQ:QCOM) also reported better-than-expected fourth-quarter results. The company delivered better-than-expected first-quarter results despite headwinds from Samsung as inventory headwinds fade. Qualcomm maintains its dominant position in the mobile handset market and should benefit as artificial intelligence moves to edge devices, driving upgrade cycles.”
Qualcomm (NASDAQ:QCOM) ranks 6th on our list of the most unstoppable AI stocks to buy right now. To see 5 stocks that are outperforming Qualcomm (NASDAQ:QCOM), 7 Unstoppable Artificial Intelligence (AI) Stocks to Buy Now.
If you're looking for AI stocks that are as promising as Microsoft but trade at less than five times earnings, check out our report. Cheapest AI Stocks.
Read next: Michael Burry sells these stocks and a new dawn dawns for US stocks.
Disclosures: None. This article was originally published on Insider Monkey.
