Bank of America expects the global artificial intelligence market to reach $900 billion by 2026, with a large portion of that growth coming from the AI software sector at $787 billion. Given the immense potential of the industry, the bank reviewed 30 stocks involved in enterprise software in AI and ranked the top 20 best-positioned for the AI opportunity, based on factors like access to quality data and solutions tailored for specific verticals. Among the top-ranked companies were Microsoft, Alphabet, Amazon, Intel, and Salesforce. Investors should be forward-looking and analyze the potential winners in the AI industry based on factors that lend themselves to success within the sector.
Nvidia’s earnings beat expectations, mainly due to demand for its GPU chips used in AI applications, leading the mega tech player to achieve a $1 trillion market cap after reaching a 52-week high. Nvidia’s stock jumped more than 24%, and analysts reacted with optimism by increasing their price targets. However, investors should be forward-looking and analyze the potential winners in the AI industry based on factors that lend themselves to success within the sector.
Bank of America’s team of analysts led by Brad Sills reviewed 30 stocks pegged to enterprise software in AI to determine which companies have the highest potential to take market share. The proprietary analysis was based on 13 questions that included queries such as whether a company has market-leading historical datasets, disruption potential, resources for innovation, and solutions tailored for specific verticals. The results were compiled into a ranking system from Tier 1 to Tier 3, with the former being best-positioned for the AI opportunity.
