ChatGPT Stock Advice: 10 Recent Stock Recommendations

1. Amazon.com, Inc. (NASDAQ:AMZN)

Number of Hedge Fund Holders: 308

Amazon’s stock recently plummeted following its disappointing third-quarter revenue guidance, prompting a significant market reaction. Despite this, Goldman Sachs tech analyst Sheridan has maintained a positive outlook on the company, even lowering his price target from $250 to $230. Sheridan argues that Amazon Web Services (AWS) is reaccelerating, largely driven by increased enterprise-level workload migration and growing AI workloads. He believes that AWS remains an undervalued asset within Amazon.com, Inc. (NASDAQ:AMZN), especially considering its 19% growth rate and mid-30s GAAP operating income margin.

Investors fear that Amazon.com, Inc. (NASDAQ:AMZN) potentially overbuilding its cloud infrastructure may outpace demand. However, Amazon.com, Inc. (NASDAQ:AMZN) has a long-term growth potential, particularly as operating margins are expected to return to pre-pandemic levels. The current stock price, around $170, is relatively cheap given the anticipated earnings growth in the coming years.

Scott Devitt from Wedbush on CNBC, highlighted a $1 billion currency headwind that impacted the top line. While AWS exceeded expectations with a 19% growth rate, the company’s advertising revenue underperformed, coming in at 19.5%, below the consensus of 22%. This underperformance contrasts with strong advertising results from other tech giants like Meta.

While the disappointing advertising revenue is concerning, AWS’s strong performance is a positive sign for Amazon’s long-term growth. The stock’s decline could be considered as a potential buying opportunity, especially given the strength in AWS. Analysts remain optimistic about the company’s long-term prospects, particularly in the cloud and AI sectors. Investors are encouraged to focus on the bigger picture of sustained growth, rather than short-term fluctuations.

While we acknowledge the potential of AMZN to grow, our conviction lies in the belief that some AI stocks hold greater promise for delivering higher returns, and doing so within a shorter time frame. If you are looking for an AI stock that is more promising than the stocks mentioned on our list but that trades at less than 5 times its earnings, heck out our report about the cheapest AI stock.

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