We recently compiled a list of AI News You Shouldn’t Miss. In this article, we’ll take a look at where Micron Technology (NASDAQ:MU) stands against other AI stocks.
Artificial intelligence (AI) is the new buzzword attracting the attention of almost everyone on Wall Street. The sector, characterized by rapid growth, significant investment, and intense competition, has witnessed an increase in venture capital (VC) funding over the past few months. By 2023, global VC investment in AI startups will exceed $94 billion. This funding increase reflects the strong belief of these investors in the transformative potential of AI in various industries. Merger and acquisition activity in the field is also increasing, with more than 1,100 such deals in 2023 alone. Big tech companies are actively acquiring AI startups to boost their capabilities in the shortest time possible.
A few sector-specific numbers highlight the potential of AI in small details. For example, in the healthcare universe, the AI ​​healthcare market is expected to reach $102 billion by 2028, with startups focusing on diagnostics, drug discovery, and personalized medicine. Financially, AI-driven financial services are expected to reach a market value of $26.67 billion by 2026, with startups focusing on fintech, fraud detection, and algorithmic trading. In the retail world, AI is transforming through personalized shopping experiences and supply chain optimization, with the sector expected to grow at a 34.4% CAGR by 2030.
Read more about these developments by accessing 33 Most Important AI Companies You Should Pay Attention To and 20 Industrial Stocks Already Riding the AI ​​Wave.
Hedge fund interest in AI has increased over the past few months, an indication of the industry’s long-term growth potential. In routine media interviews, investor conferences, and through their 13F activity, hedge fund managers detail their bullish views on AI. For example, Bill Ackman, the head of Pershing Square Capital Management, said that AI startups represent the next frontier in technology, offering unparalleled opportunities for innovation. He added that the key is finding those with a clear vision and the ability to execute in a rapidly evolving landscape.
Similarly, Ray Dalio of Bridgewater Associates believes that AI’s impact on industries is undeniable, and startups driving this change are in a unique position to capitalize on it. Dalio added, however, that it is crucial to invest in those that develop sustainable, ethical models, as they will be the long-term winners. Paul Tudor Jones of Tudor Investment Corporation believes that AI startups are not just about the technology but about changing the entire industry. He says the challenge is in navigating the hype and identifying the true innovators who have the potential to disrupt established markets.
Read more about these developments by accessing Billionaire Stan Druckenmiller Bets on AI Infrastructure, Tobacco and Industrial Stocks and 10 Tech Stocks to Watch Amid Market Turnaround According to Bernstein Analyst.
Our Method
For this article, we have selected AI stocks based on the latest news and analyst ratings. These stocks are also popular with hedge funds. Why are we interested in the stocks that hedge funds pile into? The reason is simple: our research has shown that we can outperform the market by mimicking the top stock picks of the best hedge funds. Our quarterly newsletter strategy picks 14 small-cap and large-cap stocks each quarter and has returned 275% since May 2014, beating its benchmark by 150 percentage points (see more details here ).
A close-up view of a computer motherboard with integrated semiconductor chips.
Micron Technology (NASDAQ:SA)
Number of Hedge Fund Holders: 120
Micron Technology (NASDAQ:MU) manufactures and sells memory and storage products. The company’s compute and network business unit is heavily exposed to cloud and AI. In its most recent earnings call, the company emphasized that robust demand for AI servers was a key driver of the company’s strong financial performance in the third fiscal quarter. As hyperscalers continue to increase capex due to increased data center needs, demand for Micron’s products is likely to grow even stronger. One indicator of this demand is that Micron has already sold out its high bandwidth memory capacity through 2025, even before fiscal year 2024 closes.
Micron Technology (NASDAQ:MU) has invited bullish commentary from Wall Street analysts in recent weeks. Argus analyst Jim Kelleher recently raised his price target on the stock to $170 from $140 and maintained a Buy rating, noting that the company reported fiscal Q3 earnings above the high end of its guidance range, while posting solid non-GAAP earnings that topped expectations. The analyst added that sales and profits are expected to remain strong as memory prices rise and require widespread recovery.
General MU 12th rank on our list of AI stocks you shouldn’t miss. While we recognize the potential of MU as an investment, our belief rests on the belief that some AI stocks have greater promise for delivering higher returns, and doing so within a shorter timeframe. . If you’re looking for an AI stock that’s more promising than MU but trades at less than 5 times its earnings, check out our report on cheapest AI stock.
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Disclosure: None. This article was originally published on Insider Monkey.
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