This week saw some significant analyst moves in the field of artificial intelligence (AI), impacting major tech companies and chipmakers. Here are the highlights:
UBS downgraded Tesla (NASDAQ: TSLA) from Neutral to Sell, citing a reassessment of the company’s valuation amid high AI costs. The analysts raised concerns over the unpredictability of AI improvements and the long-term nature of potential returns. They noted that Tesla’s stock price implies a value of over $500 billion for future growth initiatives, requiring the company to achieve a future value of $1 trillion within five years to support a Buy rating.
On the other hand, Bank of America raised its price target for Apple (NASDAQ: AAPL) to $256, up from $230, driven by increased confidence in a multi-year iPhone upgrade cycle. The analysts highlighted strong upside potential due to an aging installed base and GenAI features that boost customers’ intentions to upgrade.
Nomura downgraded Super Micro Computer (NASDAQ: SMCI) from Buy to Neutral, citing limited share price upside. The analysts pointed to uncertainties surrounding supply easing and the transition between Nvidia’s Hopper and Blackwell GPUs as factors affecting the company’s performance potential.
Morgan Stanley analysts praised Microsoft (NASDAQ: MSFT) as a strong GenAI leader, citing its leadership in GenAI functionality and Azure Cloud business. The survey data showed an increase in core spending growth expectations for Microsoft, driven by its strong presence in GenAI products.
KeyBanc Capital Markets raised price targets for several major chipmakers, highlighting robust demand for AI products. They projected a significant recovery in traditional server demand and projected AI servers to grow by 150% in 2024. KeyBanc also revised its price targets for leading chip stocks, including NVDA, Monolithic Power, Cirrus Logic, and Marvell Technology.
These analyst moves reflect the dynamic landscape of the AI industry and the impact it has on various companies within the sector. Investors will be closely watching how these developments play out in the coming weeks.
