Wall Street Picked These 5 AI Stocks for 2024

2. Amazon.com Inc (NASDAQ:AMZN)

Number of Hedge Fund Holders: 293
YTD Performance as of March 7, 2024: +19.3%

Amazon.com Inc (NASDAQ:AMZN) is a consumer and tech company that sells products, ads, and subscriptions. It also offers AI services through Amazon Web Services. AI helps Amazon.com Inc (NASDAQ:AMZN) improve its e-commerce, cloud, and logistics.

RBC Capital analyst Brad Erickson has called Amazon.com Inc (NASDAQ:AMZN) one of his favorite ideas in the internet space in 2024. The analyst reaffirmed a buy rating on AMZN stock with a price target of $180.

“We expect AMZN to gain ‘share’ in the GenAI narrative battle between itself, GOOGL & MSFT as Bedrock builds partnerships and gains more traction,” Erickson said in a research note to investors.

In the fourth quarter, hedge fund sentiment was positive toward Amazon.com, Inc. (NASDAQ:AMZN) as the number of hedge funds with investments in the stock went up to 293, up from 286 in the previous quarter. Fisher Asset Management increased its stake in Amazon.com Inc (NASDAQ:AMZN) by 3% to 42.24 million shares worth $6.42 billion.

This is what Polen Global Growth Strategy said about Amazon.com, Inc. (NASDAQ:AMZN) in its fourth quarter 2023 investor letter:

“Amazon.com, Inc. (NASDAQ:AMZN), which saw significant price appreciation throughout much of 2023, saw its share price increase materially in Q4 following the company’s Q3 2023 earnings report. We have yet to see the long-awaited re-acceleration in AWS (Amazon Web Services) revenue growth. However, in our estimation, the segment’s growth has likely bottomed, and we could see accelerating growth in 2024. Further, Amazon’s e-commerce business has gradually re-accelerated from 2022’s levels and, perhaps most importantly, the company’s margins and free cash flow have rebounded materially from last year. This rebound in margins and free cash flow at Amazon has been a key component of our long-term thesis for the business, and we expect the improvement in these metrics to continue into 2024 and beyond (though perhaps not linearly) as the company continues to optimize costs and capital expenditures. Our position in Amazon reflects our positive long-term expectations of the business, and it is currently our largest absolute weight in the Portfolio.”

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