Artificial intelligence (AI) continues to revolutionize various industries, including e-commerce and semiconductor production. As the technology becomes more prominent, investors are taking notice and analysts are raving about the top-rated AI stocks. Let’s delve into the details of three AI stocks that analysts are currently loving.
First on the list is Axcelis Technologies (NASDAQ:ACLS), a company that utilizes ion implantation technology to aid in semiconductor production. Semiconductors serve as the foundation for artificial intelligence and are found in numerous products such as computers, cars, appliances, and video game consoles. With the increasing demand for AI chips, Axcelis Technologies has experienced a surge in popularity.
The company is currently rated as a strong buy, with five analysts providing an average price target of $182.25. The highest price target reaches $215, highlighting the optimism surrounding Axcelis Technologies. The company boasts solid earnings, with $292.3 million in sales during the third quarter alone, representing a significant 27.6% year-over-year increase. Moreover, its net income saw an impressive 63.7% year-over-year growth, amounting to $65.9 million.
Despite its current undervaluation, Axcelis Technologies, like many AI stocks, is known for its volatility, indicated by its 1.79 beta. Nevertheless, the company’s strong financials and rising demand position it as an attractive investment opportunity.
Next up is Symbotic (NASDAQ:SYM), a slightly riskier AI stock that presents the potential for higher returns. Symbotic focuses on enhancing warehouse efficiency through artificial intelligence. Its robots perform manual tasks, while its software allows for streamlined inventory management. The company has already secured a major customer in the form of Walmart (NYSE:WMT), which holds a 62% stake in Symbotic.
Despite not having a P/E or forward P/E ratio yet, Symbotic has witnessed a remarkable 347% year-to-date growth, significantly surpassing Axcelis Technologies’ growth. The stock received a substantial boost when it reported a positive net adjusted profit, leading to a 40% rally the following day. The company’s solid Q1 FY24 guidance suggests a potential improvement in its valuation in the coming year.
Lastly, Microsoft (NASDAQ:MSFT) has emerged as a dominant player in the AI industry. With significant investments in artificial intelligence, the tech giant aims to enhance its office tools and Microsoft Azure while exploring new business opportunities. Microsoft’s involvement with OpenAI faced some controversy but hasn’t hindered its exceptional returns and leadership in this field.
The stock has gained an impressive 58% year-to-date and an astounding 266% over the past five years. Analysts remain bullish about Microsoft, with an average price target of $410.03 and the highest target reaching $450. The company’s well-diversified business segments, beyond artificial intelligence, contribute to its appeal among mutual funds, index funds, and ETFs.
In summary, these three top-rated AI stocks, Axcelis Technologies, Symbotic, and Microsoft, have captured the attention of analysts. With advancements in artificial intelligence continuing to shape various industries, these companies hold significant promise for investors seeking to capitalize on this rapidly evolving technology. However, it’s important to consider the volatility and potential risks associated with investing in AI stocks.
