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The Top Software Names to Play the Booming Artificial Intelligence Market, According to Citi
Citi Shares Top Software Names for the AI Market
Citi is sharing its top software names to play the booming artificial intelligence market, including two companies it views as "unfairly categorized" as losers. Analyst Tyler Radke believes that the overall software sector looks attractively valued, naming MongoDB as his top pick for the second half of the year. Despite the stock's significant YTD gains, Radke sees significant upside to estimates for MongoDB due to GenAI's potential as a total addressable market accelerator.
Undervalued Companies in the AI Market
Along with MongoDB, Radke believes that the market is underestimating the potential of contact center software company Nice Ltd and data analytics provider Alteryx. He argues that the categorization of these companies as AI losers is "overdone." Despite Alteryx's YTD decline and Nice's modest gains, Radke sees opportunities for these stocks to recover with strong Analyst Days, product launches, and company-specific tailwinds.
Confidence in Nice's Position
Radke is confident that Nice is well-equipped to capitalize on GenAI and make a successful transition from seat-based to usage-based pricing. He believes that recent analyst day displays a confident message about Nice's ability to leverage AI and benefit from its expanded software and growing product portfolio.
Positive Outlook for Alteryx
Radke is also optimistic about the future of Alteryx, despite concerns that AI may hinder its business. He highlights the company's strong momentum from expanded software and its use of AI and machine learning within its data analytics cloud platform. Radke believes that the company's durable 20%+ top-line growth profile, along with consistent margin expansion, could reverse the current sentiment and drive outperformance.
Overall, Citi's top software picks for the AI market include MongoDB, Nice Ltd, and Alteryx. Citi analysts believe that these companies are undervalued and have significant potential for growth in the second half of the year.
Seizing Opportunities in the Booming AI Market
Maximizing Potential for a New Business
The insights provided by Citi regarding the top software names in the booming artificial intelligence market present an exciting opportunity for new businesses looking to tap into this growing sector. For entrepreneurs seeking to enter the AI industry, analyzing the top picks can help inform their strategic decisions and position their ventures for success.
Identifying Undervalued Companies
Citi's report also sheds light on two undervalued companies, Nice Ltd and Alteryx, which have been unfairly categorized as AI losers. This presents an advantageous situation for new businesses considering collaboration or investment opportunities. By recognizing the potential these companies possess, entrepreneurs can leverage their products, technologies, and market positions to gain a competitive edge.
Capitalizing on Nice Ltd
With Nice's transition to usage-based pricing and demonstrated ability to leverage AI, entrepreneurs can draw inspiration from its confident message during recent analyst days. Identifying synergies and partnerships with Nice Ltd could prove valuable, providing access to their expanded software and growing product portfolio.
Harnessing Alteryx's Potential
Despite perceived concerns surrounding AI hindering Alteryx's business, the company's strong momentum and utilization of AI and machine learning within its data analytics cloud platform are reasons for optimism. New businesses can explore collaboration opportunities with Alteryx, tapping into its experience, expanded software, and consistent growth to create mutually beneficial partnerships.
In conclusion, being aware of the top software names in the AI market, particularly those deemed undervalued by industry experts like Citi, can have a significant impact on the growth and success of new businesses. By aligning their strategies with these key players and identifying areas of collaboration, entrepreneurs can position themselves at the forefront of the booming AI market and capitalize on its immense potential for the second half of the year and beyond.
Article First Published at: https://www.cnbc.com/2023/07/14/citi-shares-its-top-software-ideas-to-play-ai.html
