Global equity markets and Treasury yields rose on Monday as investors braced for interest rate decisions from key central banks, including the U.S. Federal Reserve, as well as corporate earnings that may shed light on the state of the economy.
This is a key week for earnings as almost a third of the S&P 500 is expected to report earnings, including many of the tech titans and those now called the “magnificent 7.”
AI fever is here to stay, and without a doubt, today's top-tier tech winners will focus on machine learning as they report their quarterly earnings results. To help you pick the cream of the crop and maximize your portfolio's potential, I'm bringing you
three headline grabbers that are proven leaders in the ongoing AI arms race.
Meta Platforms (
NASDAQ:META)
For a while, Meta Platforms was all about the
Metaverse and virtual reality. While Meta and CEO Mark Zuckerberg are still focused on the Metaverse, the company is loudly and proudly delving into the generative AI revolution this year.
Granted, another well-known technology firm got a head start when it invested heavily in OpenAI's
ChatGPT chatbot (that company is on this list, as well). Don't assume that Zuckerberg is content to just play catch-up, though.
To stay competitive in this realm, Meta has its own ChatGPT rival, known as Llama. The most recent iteration of this product, Llama 2, will reportedly be "free for research and commercial use." Is Zuckerberg making a brilliant move here, or has he completely lost his marbles? Either way, he's preparing to disrupt the generative AI industry just like he did with social media.
Now, all eyes are on Meta Platforms as the company is about to release its second-quarter 2023 earnings data. Analysts expect the company to
report EPS of $2.91, which may be a high bar to clear, but it's feasible, as Meta Platforms delivered a solid EPS beat in Q1.
What is the Price Target for META Stock?
On TipRanks, META is a Strong Buy based on 36 Buys and three Hold ratings given by analysts in the past three months. The average
Meta Platforms stock price target is $324.34, implying 11.2% upside potential.
Alphabet (
NASDAQ:GOOG)(
NASDAQ:GOOGL)
Google parent Alphabet has its own answer to ChatGPT. Admittedly, Alphabet's rival chatbot, Bard, didn't get off to a great start earlier this year. Yet, Bard was only the first chapter in a much longer and possibly more successful story for Alphabet in the generative AI space.
Reportedly, Google is bringing back its co-founder,
Sergey Brin, to help develop
Google’s new AI project, known as Gemini. A general-purpose AI model, Gemini will compete with OpenAI's recently launched GPT-4 model.
Furthermore, Deutsche Bank (
NYSE:DB
) analyst
Benjamin Black, CFA, seems to suggest that Google is well-positioned to compete against OpenAI's chatbot technology as the company competes for valuable advertising revenue. In the end, Bard's fumble might just be a distant memory as Google and Alphabet strive to make headway in the generative AI domain.
If you're prepared to try out an earnings play with Alphabet stock, you can do this either with GOOG or GOOGL shares. As for the company itself, analysts are calling for Alphabet to
report EPS of $1.34 in Q2 2023, which will likely be achievable after Alphabet's first-quarter EPS beat.
What is the Price Target for GOOGL Stock?
According to TipRanks’ analyst rating consensus, GOOGL stock is a Strong Buy based on 26 Buys and five Hold ratings. The average
Alphabet stock price target is $137, implying 12.7% upside potential.
Microsoft (
NASDAQ:MSFT)
Finally, I can't ignore the tech juggernaut that made the smart move of investing billions of dollars in OpenAI earlier this year. Of course, I'm referring to Microsoft, which has already incorporated OpenAI's technology into its Bing, Edge, Azure, and other products.
Surely, Piper Sandler analyst Brent Bracelin had this in mind when he recently called Microsoft an "
AI All-Star." Bracelin seemed particularly impressed with the "robust spending intentions" that businesses have shown lately in regard to the AI-enhanced Azure and Microsoft 365 products.
All in all, Bracelin is confident that Microsoft is "well positioned to capitalize on" recent trends in generative AI. This is a long-term conviction, however, so don't assume that Microsoft's latest advancements in generative AI will be fully reflected in the company's second-quarter earnings.
Still, AI should play a role in Microsoft's Q2-2023 results. Thus, you'll definitely want to keep a lookout for the company's upcoming earnings release. After three consecutive beats, analysts are now prepared for Microsoft to
report EPS of $2.55.
What is the Price Target for MSFT Stock?
MSFT stock is a Strong Buy on TipRanks based on 31 Buys, three Holds, and one Sell rating assigned by analysts in the past three months. The
average Microsoft stock price target is $374.59, implying 8.54% upside potential.
Conclusion: Should You Consider These AI Stocks?
Clearly, Wall Street is enamored with generative AI leaders like Meta Platforms, Alphabet, and Microsoft. These are rock-solid tech firms that have grown their market caps along with their statures as AI-industry innovators.
Now, the ball is in your court. If you're ready, feel free to consider a pre or post-earnings position in META, GOOG/GOOGL, and/or MSFT stock for prime AI exposure and, hopefully, powerful earnings-season price action.
Disclosure
The Dow Jones Industrial Average led Wall Street higher on Monday and notched its longest winning streak in six years as investors bet on sectors beyond technology in a week filled with earnings reports and a Federal Reserve meeting.
The stock market rally this year has been driven mainly by the "Magnificent Seven" stocks. Nvidia NVDA has more than tripled, while Meta META and Tesla TSLA have more than doubled year-to-date. The tech-heavy Nasdaq 100 index has
The Dow Jones Industrial Average climbed on Monday and notched its longest winning streak in six years as investors bet on sectors beyond technology in a week filled with earnings reports and a Federal Reserve meeting.
Cloud computing has become a major focus in the market over the last several years, with the technology allowing companies and consumers to achieve digital feats that otherwise felt impossible.
Two stocks receiving a considerable amount of attention leading up to their second-quarter earnings reports last week were Activision Blizzard (ATVI) and Carvana (CVNA).
Wall Street's main indexes climbed on Monday as investors bet on sectors beyond technology in a week filled with earnings reports and a Federal Reserve meeting.
Global equity markets and Treasury yields rose on Monday as investors braced for interest rate decisions from key central banks, including the U.S. Federal Reserve, as well as corporate earnings that may shed light on the state of the economy.
Global equity markets and Treasury yields rose on Monday as investors braced for interest rate decisions from key central banks, including the U.S. Federal Reserve, as well as corporate earnings that may shed light on the state of the economy.
Over the long term, stocks are a winning proposition.
The world is loaded with a variety of investments—you can buy anything from shoes to wine to land, and years down the road, someone might want to buy them for more than you paid. But it's difficult to argue with holding
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