In this article, we will dissect whether QUALCOMM Incorporated (NASDAQ:QCOM) is the most unstoppable artificial intelligence (AI) stock to buy. We will also take a closer look at the advancements in the artificial intelligence industry. To view more unstoppable AI stocks, check our free report on the 7 Unstoppable Artificial Intelligence (AI) Stocks To Buy Now.
The Bull Case for AI
On April 20, Matt Bryson, Wedbush Enterprise Hardware Analyst, appeared in an interview on Yahoo Finance where he discussed the major players in the AI industry and how interest rate cuts may have little to no impact on the tech wave. Shares of tech stocks including Advanced Micro Devices, Inc. (NASDAQ:AMD) and Intel Corporation (NASDAQ:INTC) have been down by 15% over the past 30 days, followed by the Philadelphia Semiconductor Index dropping by 10% despite recent highs previously. Despite the pullback in industry activity, Bryson holds a bullish view on artificial intelligence. Bryson highlights the fuel in AI is backed by chip stocks and cloud services providers, lifting NVIDIA Corporation (NASDAQ:NVDA), Advanced Micro Devices, Inc. (NASDAQ:AMD), and Amazon.com Inc (NASDAQ:AMZN). He added that despite the pullback, large tech stocks, especially chip makers, will continue investing in AI in 2025 and post strong growth results. Bryson suggests that high interest rates will certainly weigh on consumer spending in the long run, impacting high multiple stocks such as large chipmakers. He then said that interest rates may have little to no impact on the fundamental landscape of technology and AI. According to Bryson, data center operators like Microsoft Corporation (NASDAQ:MSFT) and Amazon.com Inc (NASDAQ:AMZN) will continue to bet on developing AI applications.
Bryson thinks that NVIDIA Corporation’s (NASDAQ:NVDA) Blackwell, a next-gen semiconductor product, will impact the industry positively. While he is certain that AI hardware and software companies will define parameters of success for the industry, he claims it is uncertain to predict the technological developments in AI at the moment. Bryson also holds a bullish view on Taiwan Semiconductor Manufacturing Company Limited (NYSE:TSM) after NVIDIA Corporation (NASDAQ:NVDA) and talked about the possibility of companies like Microsoft Corporation (NASDAQ:MSFT) and Amazon.com Inc (NASDAQ:AMZN) developing their own semiconductor products, altering Taiwan Semiconductor Manufacturing Company Limited’s (NYSE:TSM) position in the market. Bryson said while he expects the industry to grow, it is difficult to predict what sectors AI might penetrate.
Some Developments in the AI Space
In a groundbreaking update, On May 13, OpenAI launched GPT-4o, a platform capable of working across audio, vision, and text in real-time. The new application takes interactions between humans and computers to the next level. The application can provide outputs in response to audio inputs in 232 milliseconds, with an average of 320 milliseconds. While the new product complements GPT-4 Turbo’s performance on text in English and code, it is also 50% cheaper and much faster. The tool is also equipped to understand vision and audio inputs easily.
On May 20, Microsoft Corporation (NASDAQ:MSFT) launched CoPilot + PCs, designed for artificial intelligence. The new PCs are one of the most intelligent and fastest PCs to be ever built. Its new silicon can perform 40-plus trillion operations per second, has a long battery life, and comes with built-in advanced AI models. Individuals in the custody of the new devices will be able to generate and refine images in real-time using Cocreation and function in over 40 languages using the Live Captions tool. The PCs will be made available starting June 18.
Wall Street is Bullish on Microsoft Corporation (NASDAQ:MSFT). On May 22, analyst firm, Wedbush reiterated an Outperform rating on Microsoft Corporation (NASDAQ:MSFT) and maintained a price target of $500. Based on analyst estimates over the past 3 months, 32 Wall Street analysts held a buy rating on the stock, with an average price target of $491.23 and a high forecast of $600. The stock’s average price target has an upside of 11.88% from its current price of $427.25.
Now that we have discussed the latest developments in the AI space, let’s take a look at the 7 unstoppable artificial intelligence (AI) stocks to buy. You can also read our piece on the best AI stock picks of billionaire Steve Cohen and billionaire Stanley Druckenmiller’s best AI stocks to buy now.
A close up of a circuit board, its microchips creating a powerful computing system.
Our Methodology
To come up with the 7 unstoppable artificial intelligence (AI) stocks to buy we went over four ETFs including iShares U.S. Technology ETF, Fidelity MSCI Information Technology Index ETF, iShares Global Tech ETF, and iShares Expanded Tech Sector ETF, and our rankings of AI companies and AI stocks. We compiled a list of 30 stocks and screened for them on Finviz. We narrowed down our sample to stocks that have gained at least 35% on a year-to-date basis, as of May 23, and selected the 10 with the highest share price gains. Our stocks are listed in ascending order of their YTD gains.
We also added the hedge fund sentiment around each stock. The hedge fund data was taken from Insider Monkey’s database of 933 elite hedge funds as of the first quarter of 2024. Hedge funds’ top 10 consensus stock picks outperformed the S&P 500 Index by more than 140 percentage points over the last 10 years (see the details here). That’s why we pay very close attention to this often-ignored indicator.
Is QUALCOMM Incorporated (NASDAQ:QCOM) the Most Unstoppable AI Stock to Buy Now?
QUALCOMM Incorporated (NASDAQ:QCOM)
YTD Gains as of April 23: 40.31%
Number of Hedge Fund Holders: 78
QUALCOMM Incorporated (NASDAQ:QCOM) is one of the unstoppable AI stocks to buy. The semiconductor company produces hybrid AI architecture applicable to most generative AI applications and devices including phones, laptops, XR headsets, cars, and IoT. QUALCOMM Incorporated (NASDAQ:QCOM) engages in the production of AI hardware, AI software, and AI algorithms.
On May 7, Argus Research maintained a Buy rating on QUALCOMM Incorporated (NASDAQ:QCOM) and increased its price target to $205 from $180. The stock has Buy-equivalent ratings as per the 19 out of 28 Wall Street analysts that have covered it over the past three months. As of May 20, the stock has an average price target of $187.91 and a high forecast of $220.
On May 5, QUALCOMM Incorporated (NASDAQ:QCOM) reported earnings for the fiscal second quarter of 2024. The company reported earnings per share of $2.44, beating estimates by $0.12. It also reported revenue worth $9.39 billion, ahead of market consensus by $39.41 million, with a year-over-year revenue growth rate of 1.27%.
Madison Investment Holdings Inc’s Madison Sustainable Equity Fund stated the following regarding QUALCOMM Incorporated (NASDAQ:QCOM) in its Q4 2023 investor letter:
“QUALCOMM Incorporated (NASDAQ:QCOM) also reported a solid fourth fiscal quarter with better than expected results. The company guided the first quarter ahead of expectations despite headwinds from Samsung as the inventory headwinds dissipate. Qualcomm remains well positioned in the mobile handset market and should benefit as Artificial Intelligence moves to edge devices which could drive an upgrade cycle.”
QUALCOMM Incorporated (NASDAQ:QCOM) is ranked 6th on our list of the most unstoppable AI stocks to buy now. To view the 5 stocks that beat QUALCOMM Incorporated (NASDAQ:QCOM), view our free report on the 7 Unstoppable Artificial Intelligence (AI) Stocks To Buy Now.
If you are looking for an AI stock that is as promising as Microsoft but that trades at less than 5 times its earnings, check out our report about the cheapest AI stock.
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Disclosure: None. This article is originally published at Insider Monkey.
