Since the unveiling of OpenAI’s ChatGPT last November, the interest of investors in artificial intelligence (AI) skyrocketed. Countless players are now getting attracted to the space as people are rethinking possibilities for disruptive changes that AI could bring. In its second-quarter earnings release, NVIDIA Corporation (NVDA – Free Report) mentioned that globally companies are transitioning to accelerated computing and generative AI from general purpose.
These trends are reflected in soaring AI stocks, indicating investors’ expectations that a lot will change in the coming years with the advancement in AI. Considering the backdrop, three stocks that are well-poised to gain in the long run are NVIDIA, Amazon.com, Inc. (AMZN – Free Report) and Adobe Inc. (ADBE – Free Report) .
We have employed our proprietary stock screener to zero down these three stocks. NVIDIA and Amazon sport a Zacks Rank #1 (Strong Buy), while Adobe carries a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.
3 Stocks in the Spotlight
Huge demand for NVIDIA’s data center graphics processing units (GPUs) that power AI servers is accumulating terrific growth for the stock. From selling data center chips, the company generated 76% of its revenue in the second quarter of fiscal 2024. NVDA has guided revenues for the third quarter of fiscal 2024 at $16 billion, calling for a massive growth from just $5.9 billion in the year-ago comparable quarter. This is a good reflection of the continuation of NVIDIA’s AI-driven growth.
Amazon is making a considerable effort to integrate AI into its services. This has created opportunities for Amazon’s Amazon Web Services (AWS) to rejuvenate its cloud business. For training and running AI systems, Amazon over the years has been developing its own AI chips, which can be a substitute for Nvidia’s chips.
Adobe is introducing generative AI toolsfor extending its services. Recently, ADBE rolled out Firefly, a generative AI platform for users to generate and edit images. The technology can also be implemented for animations and editing videos, creating more opportunities.
This article was originally published on this site