AI Chip Makers Surge: NVIDIA and AMD Lead the Charge in Booming AI Market

What's Going On With AI Stocks Nvidia, AMD On Monday? - NVIDIA (NASDAQ:NVDA), Advanced Micro Devices (NASDAQ:AMD)

Wall Street expects Taiwan Semiconductor to report a 30% profit rise, hitting $7.25 billion for Q2. Key artificial intelligence chip stocks Nvidia Corp NVDA and Advanced Micro Devices, Inc AMD stocks continue to ride the artificial intelligence wave Monday. Wall Street expects leading AI contract chipmaker Taiwan Semiconductor Manufacturing Co TSM to likely report a 30% rise in second-quarter profit on Thursday. The Street expects Taiwan Semiconductor to clock a net profit of $7.25 billion for the quarter ending June 30. Also Read: Nvidia Highlights Lucrative Returns For Cloud Providers Using Nvidia GPUs Tech investor James Anderson predicted that Nvidia could achieve a market capitalization nearing $50 trillion within the next decade due to its crucial role in AI chip demand. He noted Nvidia could reach earnings of $1,350 per share and free cash flow of $1,000 per share with sustained 60% annual growth in data center revenue. Nvidia stock gained over 178% in the last 12 months. AMD gained over 53% during the period. Investors can gain exposure to the semiconductor sector through ProShares Ultra Semiconductors USD and Invesco PHLX Semiconductor ETF SOXQ. NVIDIA Stock Prediction For 2024 Equity research can be a valuable source of information for learning about a company's fundamentals. Analysts create financial models based on the fundamentals and expected future earnings of a company to arrive at a price target and recommendation for the stock. Shares of NVIDIA have an average 1-year price target of $827.85, representing an expected upside of 536.49%. Because of differences in assumptions, analysts can arrive at very different price targets and recommendations. No analysts have bearish recommendations on NVIDIA, while 47 analysts have bullish ratings. The street high price target from Cantor Fitzgerald is $1400.0, while the street low from Goldman Sachs is $135.0. Price Actions: NVDA shares traded higher by 0.76% at $130.22 at the last check on Monday. AMD is up 0.19% at $181.96. Also Read: What's Going On With AI Server Stock Super Micro Computer On Monday? Photo via Shutterstock Market News and Data brought to you by Benzinga APIs

AMD, Broadcom, Marvell likely to see increased AI benefit in second half: TD Cowen

The theme of generative artificial intelligence has been dominated by a few companies, especially Nvidia (NVDA), but it looks to be broadening out, research firm TD Cowen said. "NVIDIA continues to dominate trading, narrative, and fundamentals, though GenAI spending is beginning to expand to others such as AMD, Broadcom (NASDAQ:AVGO) and Marvell (NASDAQ:MRVL) (a dynamic that will accelerate in C2H24)," analysts at the firm wrote in an investor note. The analysts added that there are "no signs" of generative AI demand abating in the near term, pointing out that Broadcom recently raised its AI target for the full year. Additionally, major software companies are still rolling out AI-based products, so it's likely that demand will continue to strengthen as the big spenders try to achieve the convergence of general artificial intelligence. The firm raised its price targets on AMD, Credo Technology, Cirrus Logic, Monolithic Power Systems, MACOM Technology Solutions (MTSI) and Nvidia. Delving a bit deeper, the analysts expect that the MI300X accelerator program (and its successors) could help AMD generate $4.75B in sales in 2024 and $9.5B in 2025. Meanwhile, Broadcom is seen as "exceptionally well-positioned to benefit from the ongoing transition to Ethernet back-end networking in addition to custom silicon ramping." Marvell should benefit as the attachment rate on opto-electronics rises and its custom silicon business continues to see growth. Monolithic Power should also benefit from strong attach rates and an increase in content at Nvidia, AMD and its power management business for tensor processing units, specifically at Google (GOOG) (GOOGL), which is a Broadcom client. Credo Technology (CRDO) is also an expected beneficiary in the small and mid-cap space, as is Qualcomm (QCOM), which the firm said is "poised to benefit from expansion of AI spend beyond datacenter towards client devices including smartphone and PCs." More on AMD, Broadcom and more Marvell Technology: Analyzing Potential Upside Of AI, Recovery Of Other Businesses AMD: May Beat Q2 Earnings, Looks Fairly Valued Now AMD: Long-Term Implications Of The Silo AI Acquisition SA Asks: What are the best chip stocks to invest in right now? AMD slips even as Roth MKM, Wells Fargo boost targets after Silo AI deal

Is AMD Stock a Buy Now? | The Motley Fool

When it comes to investing in Advanced Micro Devices (AMD -0.18%) for its artificial intelligence (AI) chips, it may seem like a bad call given Nvidia's market lead. Indeed, with Nvidia holding an estimated 80% or more of the market according to estimates, it may seem counterproductive to buy AMD stock because of its AI. However, AMD has a long history of catching up to competitors. Moreover, it appears to have made a move that could make the semiconductor stock a major player in the AI chip market. On July 10, AMD announced it would acquire Silo AI. The purchase will cost AMD $665 million, and that investment will bring Europe's largest AI lab under its control. Silo AI's mission is to help organizations implement the most advanced AI technology available, a factor that should work to AMD's benefit. This purchase also helps AMD build on its acquisition of Nod.ai, an AI software company which it acquired last fall. Such improvements on the software side should bolster AMD's MI300 series of accelerators, improving its chances of keeping pace with Nvidia and other companies. AMD shareholders should also note that Nvidia's data-center segment, which makes AI chips, now accounts for 87% of company revenue, a dramatic change from the days when it was mainly a gaming-chip company. AMD's data-center segment grew its revenue by 80% yearly in the first quarter of 2024. If the data-center segment can maintain that growth rate, it could become the dominant part of the company, similar to Nvidia's data-center segment. Nonetheless, investors should not forget its other segments, which collectively make up almost 60% of AMD's revenue. The Client segment, which designs PC chips, grew by 85% yearly as it recovered from a longtime slump. Its Ryzen 8000 series processors have become popular with customers as this part of the semiconductor industry begins to bounce back. However, some parts of the chip industry remain in a slump. One is gaming, whose revenue dropped 48% from year-ago levels due to slumping graphics processing unit (GPU) sales. Additionally, AMD's Embedded segment, most of which came from the purchase of Xilinx in 2022, experienced a 46% revenue drop as customers cut spending. The underperforming segments nearly wiped out the gains of the high-performing parts of the business. In Q1 2024, revenue of just under $5.5 billion rose by only 2% compared with the previous year. Still, AMD reported a $123 million profit in Q1, up from a $139 million loss one year prior. Also, if AMD meets its midpoint-revenue estimate in Q2 of $5.7 billion, revenue growth will rise to 6%. That growth rate is still a small fraction of Nvidia's, but it is a sign that AI chip sales are beginning to have a positive effect on the financials. Also, AI-fueled optimism likely took the stock more than 60% higher over the last year. Nonetheless, its forward price-to-earnings (P/E) ratio of 53 may be skewed when considering the company's recent return to profitability. Also, the price-to-sales (P/S) ratio of 13 may seem high, but it still compares favorably to Nvidia's 42 P/S ratio. That difference could spur AMD's stock-price growth in the foreseeable future. Given its current state, AMD remains a buy, and the Silo AI acquisition reinforces the AMD investment case. Admittedly, such improvements do not mean AMD will unseat Nvidia as the leading AI chip company in the foreseeable future. However, Nvidia has shown that AI chips are currently the industry's most important product, and anything that bolsters AMD's ability to compete is a positive. Also, if AMD can come close to matching the 87% of company revenues that come from the data-center side of the business, it should take AMD stock much higher over time.

TD Cowen raises price targets on Nvidia, AMD shares into earnings By Investing.com

TD Cowen raised its price targets on NVIDIA (NVDA) and AMD (NASDAQ:AMD) shares ahead of their upcoming earnings reports, citing strong demand and positive future prospects. For Nvidia (NASDAQ:NVDA), TD Cowen highlights the company's robust performance, particularly in its data center segment. "Our checks continue to point to upside in Datacenter as demand for Hopper/Blackwell-based AI systems continues to exceed supply," noted the bank. Analysts expect a significant beat and raise on the F2Q25 call, driven by sustained demand for Hopper-based systems and the anticipated ramp-up of the Blackwell platforms. TD Cowen has reiterated Nvidia as a Top Pick, raising its price target to $165 from $140. The firm points to Nvidia's relentless pace of innovation across the AI compute stack as a key factor in its continued success, with a solid product roadmap that supports growth through 2025 and beyond. Similarly, TD Cowen is optimistic about AMD's prospects, despite some challenges in specific segments. Analysts note that over the past nine months, AMD's sentiment has fluctuated, but the fundamentals remain strong. "We believe the fundamental setup into 2H24 and 2025 is strong, driven by some upside to core server, strong growth of MI300/325 ahead of the MI350/400 product cycles, and favorable PC seasonality near-term," analysts stated. Analysts anticipate AMD's Datacenter segment to show significant growth, with a steady performance in the Client segment offsetting weaker Gaming and Embedded segments. TD Cowen has raised AMD's price target to $210 from $200, expecting strong momentum as the company ramps up its CPU and AI products in the latter half of 2024 and into 2025. Overall, TD Cowen's updated price targets for Nvidia and AMD reflect their confidence in the companies' continued growth and market leadership in AI and data center technologies.