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Should You Buy These 4 AI Stocks Ahead of Q1 Earnings?
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Artificial Intelligence (AI) has been at the focal point of investors’ horizons in 2024, thanks to the growing proliferation of AI-supported products and services. Demand for AI is escalating, and that has increased the need for data center capacity expansion as well as semiconductor chips that can offer significant computational power to process massive amounts of data.
AI’s rapid proliferation bodes well for semiconductor companies, data center infrastructure providers, cloud computing and AI software providers. The first-quarter 2024 earnings season is expected to offer investors an insight into how AI companies are faring in terms of generating revenues and earning profits through AI endeavors.
Arista Networks (ANET - Free Report) , Amazon (AMZN - Free Report) , Advanced Micro Devices (AMD - Free Report) and NVIDIA (NVDA - Free Report) are a few stocks that investors may find wise to buy ahead of the first-quarter earnings thanks to their growing AI prowess.
Let’s delve deep into find out how AI has shaped up growth trajectory of these top-ranked stocks this earnings season.
Arista Networks is scheduled to report first-quarter 2024 results on May 7. Strong demand for computer network switches by hyperscalers has been benefiting its prospects. Higher bandwidth requirements in data centers are driving demand for ANET’s network switches.
ANET holds a leadership position in 100-gigabit Ethernet switching share in port for the high-speed datacenter segment. It is increasingly gaining market traction in 200 and 400-gig high-performance switching products and remains well-positioned for healthy growth in data-driven cloud networking business with proactive platforms and predictive operations. The versatility of Arista’s unified software stack across various use cases, including WAN routing, campus and data center infrastructure, sets it apart from other competitors in the industry.
Arista’s first-quarter 2024 results are expected to have benefited from these factors. The Zacks Consensus Estimate for earnings is pegged at $1.74 per share, up by a penny over the past 30 days and indicates 21.68% year-over-year growth.
Amazon is set to report its first-quarter 2024 results on Apr 30. The e-commerce giant is one of the leading cloud computing providers through its Amazon Web Services (AWS) business. Amazon has been a prolific user of AI in its online retail offering. AI driven Alexa has already been integrated into a host of everyday devices for the digital home.
AMZN sells AI services through AWS. It is investing close to $4 billion in Anthropic to bolster its position in the generative AI market. Anthropic’s foundation model and chatbot Claude is a direct competitor of MicrosoftMSFT backed OpenAI’s ChatGPT.
Anthropic is using AWS as its primary cloud provider to develop future foundation model development. Anthropic will also use Amazon chips to train, build and deploy its foundation model.
Amazon has also unveiled AWS Trainium2 chips made for training and running AI models. They are capable of delivering up to four times better performance and two times better energy efficiency than the first-generation Trainium, which was introduced in 2020.
Amazon’s first-quarter results are expected to reflect solid Prime momentum owing to ultrafast delivery services, robust content portfolio and strong adoption of AWS. The Zacks Consensus Estimate for earnings is pegged at 82 cents per share, up by a penny over the past 30 days and indicates 164.52% year-over-year growth.
AMD is playing catch-up to NVIDIA in the AI chip market. Products, including the Ryzen 8040 series processor with Ryzen AI and Instinct MI300 Series data center AI accelerators, have been noteworthy launches. The company has introduced the ROCm 6 open software stack with significant optimizations and new features supporting Large Language Models.
The latest Ryzen 8040 series mobile processors, when combined with Ryzen AI NPU on-die, extend AMD’s leadership position in the AI-supported PC markets. Systems from Acer, Asus, Dell, HP, Lenovo and Razer are leveraging Ryzen 8040 series processors.
AMD has expanded its data center footprint with the new Instinct MI300X accelerator. It combines CDNA 3 architecture and Zen 4 CPUs to deliver robust performance for HPC and AI workloads. Partners like Microsoft, Oracle and Dell are already using the accelerators in their systems.
AMD is scheduled to report first-quarter 2024 results on Apr 30. The Zacks Consensus Estimate for earnings is pegged at 60 cents per share, up by a penny over the past 30 days. The figure remains unchanged on a year-over-year basis.
Advanced Micro Devices, Inc. Price and EPS Surprise
NVIDIA is set to report its first-quarter fiscal 2025 results on May 22. At present, it is the largest global manufacturer of generative AI chipsets. NVDA’s A100 and H100 AI chips are used to build and run AI applications, including OpenAI’s ChatGPT.
NVIDIA has been benefiting from the strong growth of AI, high-performance and accelerated computing. The data center end-market business is benefiting from the growing demand for generative AI and large language models using GPUs based on NVIDIA Hopper and Ampere architectures.
NVIDIA is serving top cloud server companies like Amazon, Baidu and Meta Platforms, which are infusing AI into various applications. It has also partnered with the industry biggies, IBM, Microsoft and SAP, in order to bring AI to the enterprise users’ table.
The Zacks Consensus Estimate for earnings is pegged at $5.49 per share, up by a penny over the past 30 days and indicates 403.67% year-over-year growth. The consensus mark for revenues is pegged at $24.17 billion, suggesting 236.08% year-over-year growth.
Image: Bigstock
Should You Buy These 4 AI Stocks Ahead of Q1 Earnings?
Artificial Intelligence (AI) has been at the focal point of investors’ horizons in 2024, thanks to the growing proliferation of AI-supported products and services. Demand for AI is escalating, and that has increased the need for data center capacity expansion as well as semiconductor chips that can offer significant computational power to process massive amounts of data.
AI’s rapid proliferation bodes well for semiconductor companies, data center infrastructure providers, cloud computing and AI software providers. The first-quarter 2024 earnings season is expected to offer investors an insight into how AI companies are faring in terms of generating revenues and earning profits through AI endeavors.
Arista Networks (ANET - Free Report) , Amazon (AMZN - Free Report) , Advanced Micro Devices (AMD - Free Report) and NVIDIA (NVDA - Free Report) are a few stocks that investors may find wise to buy ahead of the first-quarter earnings thanks to their growing AI prowess.
While ANET sports a Zacks Rank #1 (Strong Buy), AMZN, AMD, and NVDA carry a Zacks Rank #2 (Buy) each, at present. You can see the complete list of today’s Zacks #1 Rank stocks here.
Let’s delve deep into find out how AI has shaped up growth trajectory of these top-ranked stocks this earnings season.
Arista Networks is scheduled to report first-quarter 2024 results on May 7. Strong demand for computer network switches by hyperscalers has been benefiting its prospects. Higher bandwidth requirements in data centers are driving demand for ANET’s network switches.
ANET holds a leadership position in 100-gigabit Ethernet switching share in port for the high-speed datacenter segment. It is increasingly gaining market traction in 200 and 400-gig high-performance switching products and remains well-positioned for healthy growth in data-driven cloud networking business with proactive platforms and predictive operations. The versatility of Arista’s unified software stack across various use cases, including WAN routing, campus and data center infrastructure, sets it apart from other competitors in the industry.
Arista’s first-quarter 2024 results are expected to have benefited from these factors. The Zacks Consensus Estimate for earnings is pegged at $1.74 per share, up by a penny over the past 30 days and indicates 21.68% year-over-year growth.
Arista Networks, Inc. Price and EPS Surprise
Arista Networks, Inc. price-eps-surprise | Arista Networks, Inc. Quote
Amazon is set to report its first-quarter 2024 results on Apr 30. The e-commerce giant is one of the leading cloud computing providers through its Amazon Web Services (AWS) business. Amazon has been a prolific user of AI in its online retail offering. AI driven Alexa has already been integrated into a host of everyday devices for the digital home.
AMZN sells AI services through AWS. It is investing close to $4 billion in Anthropic to bolster its position in the generative AI market. Anthropic’s foundation model and chatbot Claude is a direct competitor of Microsoft MSFT backed OpenAI’s ChatGPT.
Anthropic is using AWS as its primary cloud provider to develop future foundation model development. Anthropic will also use Amazon chips to train, build and deploy its foundation model.
Amazon has also unveiled AWS Trainium2 chips made for training and running AI models. They are capable of delivering up to four times better performance and two times better energy efficiency than the first-generation Trainium, which was introduced in 2020.
Amazon’s first-quarter results are expected to reflect solid Prime momentum owing to ultrafast delivery services, robust content portfolio and strong adoption of AWS. The Zacks Consensus Estimate for earnings is pegged at 82 cents per share, up by a penny over the past 30 days and indicates 164.52% year-over-year growth.
Amazon.com, Inc. Price and EPS Surprise
Amazon.com, Inc. price-eps-surprise | Amazon.com, Inc. Quote
AMD is playing catch-up to NVIDIA in the AI chip market. Products, including the Ryzen 8040 series processor with Ryzen AI and Instinct MI300 Series data center AI accelerators, have been noteworthy launches. The company has introduced the ROCm 6 open software stack with significant optimizations and new features supporting Large Language Models.
The latest Ryzen 8040 series mobile processors, when combined with Ryzen AI NPU on-die, extend AMD’s leadership position in the AI-supported PC markets. Systems from Acer, Asus, Dell, HP, Lenovo and Razer are leveraging Ryzen 8040 series processors.
AMD has expanded its data center footprint with the new Instinct MI300X accelerator. It combines CDNA 3 architecture and Zen 4 CPUs to deliver robust performance for HPC and AI workloads. Partners like Microsoft, Oracle and Dell are already using the accelerators in their systems.
AMD is scheduled to report first-quarter 2024 results on Apr 30. The Zacks Consensus Estimate for earnings is pegged at 60 cents per share, up by a penny over the past 30 days. The figure remains unchanged on a year-over-year basis.
Advanced Micro Devices, Inc. Price and EPS Surprise
Advanced Micro Devices, Inc. price-eps-surprise | Advanced Micro Devices, Inc. Quote
NVIDIA is set to report its first-quarter fiscal 2025 results on May 22. At present, it is the largest global manufacturer of generative AI chipsets. NVDA’s A100 and H100 AI chips are used to build and run AI applications, including OpenAI’s ChatGPT.
NVIDIA has been benefiting from the strong growth of AI, high-performance and accelerated computing. The data center end-market business is benefiting from the growing demand for generative AI and large language models using GPUs based on NVIDIA Hopper and Ampere architectures.
NVIDIA is serving top cloud server companies like Amazon, Baidu and Meta Platforms, which are infusing AI into various applications. It has also partnered with the industry biggies, IBM, Microsoft and SAP, in order to bring AI to the enterprise users’ table.
The Zacks Consensus Estimate for earnings is pegged at $5.49 per share, up by a penny over the past 30 days and indicates 403.67% year-over-year growth. The consensus mark for revenues is pegged at $24.17 billion, suggesting 236.08% year-over-year growth.
NVIDIA Corporation Price and EPS Surprise
NVIDIA Corporation price-eps-surprise | NVIDIA Corporation Quote