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Top Artificial Intelligence Stocks for Investment
Morgan Stanley analysts have identified 37 top stocks in the global artificial intelligence (AI) industry, with a combined market capitalization of $2.8 trillion. The bank believes that AI technology is entering a "golden age" and expects the industry to triple its total addressable market to $275 billion by 2027. The first half of the year saw significant gains in AI-related stocks such as Nvidia and Meta Platforms, but Morgan Stanley believes that there are still plenty of opportunities for investors.
Key AI Players
The bank's top picks for AI investments include semiconductor companies such as Nvidia and Advanced Micro Devices (AMD). Nvidia, which has seen its shares nearly triple in value this year, is considered a clear leader in AI hardware. Morgan Stanley expects Nvidia's dominance to continue in the foreseeable future. AMD is also highlighted for its low-cost inferencing segment, with the upcoming launch of its MI300 product. The bank remains bullish on AMD's revenue forecasts, particularly from the U.S. hyperscalers.
In addition to semiconductor companies, custom chip design vendors like Marvell Technology are viewed as well-positioned to benefit from the AI industry. Marvell Technology has seen its shares rise by nearly 63% this year and is expected to have 15% upside potential. Taiwan Semiconductor Manufacturing, another dominant AI leader, is forecasted to generate 13% of its revenues from AI chip manufacturing by 2027. The company is seen as a key enabler of future AI semis due to its technology leadership.
Morgan Stanley advises investors to cast a wide net when positioning for AI investments and consider factors such as growth, quality, regional trends, and specific technology niches. The bank encourages investors to look beyond the U.S. and explore opportunities in Taiwan, Korea, and Europe as well. With the AI industry expected to become a $3 trillion industry by the end of the decade, there are ample opportunities for investors to capitalize on this "golden age" of AI.
The Future of AI Investments and New Business
The global artificial intelligence (AI) industry is poised for exponential growth, with investment opportunities aplenty for both existing players and newly filed businesses. Morgan Stanley's identification of the top AI stocks, a market capitalization of $2.8 trillion, and a projected tripled total addressable market to $275 billion by 2027 provide a compelling outlook for investors.
For new business ventures, the AI boom presents an array of prospects. The key AI players like Nvidia and Advanced Micro Devices (AMD) dominate the semiconductor segment, offering hardware solutions crucial for AI technologies. Successfully positioning a new business as a provider of innovative AI hardware or related services could enable substantial gains in the rapidly expanding market.
Furthermore, custom chip design vendors such as Marvell Technology are positioned to capitalize on the AI industry. These vendors play a vital role in enabling AI advancements, presenting an opportunity for new businesses to carve a niche in supporting AI hardware development and infrastructure.
Expanding beyond the US market, exploring opportunities in Taiwan, Korea, and Europe is recommended by Morgan Stanley. For new business ventures, this emphasizes the importance of considering global trends and establishing an international footprint to tap into emerging AI markets and access a broader customer base.
As the AI industry is expected to reach a staggering $3 trillion by the end of the decade, new businesses have a golden opportunity to participate in this transformative era. By focusing on niche technology sectors, building quality solutions, and engaging in regional trends, new ventures can position themselves to ride the wave of AI growth and secure success in this rapidly evolving market.
Article First Published at: https://www.cnbc.com/2023/07/10/morgan-stanley-shares-way-to-play-ai-as-we-enter-a-golden-age-.html