Investing.com — A look at this week's biggest analyst moves in the artificial intelligence (AI) space.
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Apple's focus on AI is 'clearly visible' – BofA
Analysts at Bank of America Securities this week reiterated their buy rating and $230 price target.
The move comes after Apple (NASDAQ:) held its highly anticipated iPad event. BofA said the event showed that the tech giant's focus on AI was “clearly visible.”
Analysts said Apple continues to impress with its hardware, particularly innovations in silicon technology with the introduction of the new M4 chip in the iPad Pro.
The advanced neural engine within the M4 chip enables “AI-enabled features” such as separating a subject from the background in a 4K video using Apple's Final Cut Pro.
It can also detect documents, reposition frames using AI, and remove shadows in images. Additionally, new features in iPadOS offer enhancements such as Visual Lookup, Live Text, Subject Lift, and more.
“There are no changes to our estimates or price targets. We remain Buy on GenAI unitholders on the back of GM's upside and service momentum,” BofA wrote.
Baird upgrades Micron stock to buy
Baird analysts shared the latest takeaways from their research on the semiconductor industry earlier this week.
The most important change is that we upgraded Micron (NASDAQ:)'s rating and changed the stock from Neutral to Outperform.
The investment firm said it sees strong upside potential for the largest U.S. memory chip maker, saying its products are essential to powering highly demanding AI models.
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“Although we got on the train a little late, we believe Micron has a meaningful upside opportunity, especially given the recent stock decline. “This is a somewhat unprecedented outlook for memory going forward, as the market is spreading over the next 12 to 18 months,” Baird analysts said.
Baird expects industry-wide supply growth to be in the low single digits quarter-on-quarter in the second half of 2024, with DRAM prices outperforming channel expectations and a shift in capacity to high-bandwidth memory (HBM). He emphasized that the growth rate is expected to slow down. Analysts are predicting a new supercycle for HBM, greatly increasing Micron's gross profit potential like his early NAND lamps.
“Micron could generate gross margins of more than 60% on HBM3E production, increasing yields by moving from 8 hours to 12 hours later this year. “It has the potential to capture high-digit market share,” the analyst said.
RBC bullish on ServiceNow after analyst day
On Monday, cloud and AI software maker ServiceNow (NYSE:) held its Financial Analyst Day in Las Vegas, drawing mostly positive reactions from analysts.
In a research note, RBC Capital expressed a more optimistic outlook on the company's potential, emphasizing that generative AI capabilities “should be deployed in every workflow for every product in every industry.”
“The company has done an excellent job of providing additional early information on opportunities for Pro Plus deployments, while the innovation and expansion of the platform indicates further significant opportunities to come, including around the front office. “This is likely to be an indication,” RBC said.
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Looking ahead, the company's analysts emphasized that ServiceNow remains “one of the best positioned to monetize GenAI and one of our best ideas.”
In a separate note, Morgan Stanley analysts noted that Analyst Day effectively introduced the core of NOW's long-term investment theory. Specifically, the Wall Street giant highlighted the company's expanding opportunities, effective execution to seize these opportunities, and best-in-class unit economics.
Citi raises Palantir stock PT but remains cautious
Palantir Technologies (NYSE:) on Monday raised its full-year earnings forecast after reporting quarterly revenue that beat Wall Street expectations and was supported by new business as artificial intelligence continues to soar.
Nevertheless, the guidance remained below Wall Street's expectations, leading to a sharp decline in the company's stock the next day.
Still, Citi Research analysts remained cautiously optimistic about the AI software company.
“Among a unique set of metrics to constantly unpack, PLTR's first-quarter results showed solid upside in both sales and bottom line, despite slightly upward revisions to full-year targets,” they said. Ta.
“Our new customer acquisition momentum continued with record new customer acquisitions, and business value growth was very healthy. The main negative for the quarter was billing growth of just +2% and collections The downturn and operating cash flow were down,” the analyst added.
The investment bank raised its 12-month price target to $25 from $23, but maintained its “neutral” rating on the stock, calling it “one of the highest EV/Sales multiples in the software industry and a growing We are waiting for further confidence on the sustainability of this.” Monetization of AIP. ”
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Benchmark: Roblox “stands out in AI-driven environments”
Shares of video game developer Roblox (NYSE:) fell sharply on Thursday after the company reported lower-than-expected first-quarter results and guidance.
The company's revenue was $801.3 million, slightly below Visible Alpha's estimate of $806.2 million.
However, revenue increased 22% year over year from $655.3 million in Q1 2023.
Ahead of the report's release, Benchmark's analysts in a research note predicted continued success in revenue growth driven by tight cost controls, which would translate into significant operating leverage and cash flow growth.
“Roblox is embarking on a promising new growth opportunity this year by introducing advertising to its platform. Given the company's innovative approach and large user base, this move is expected to be successful. ” Benchmark analysts said.
In terms of AI, Roblox leverages fast-growing technologies to improve platform safety, reduce costs through efficient moderation tools, and improve game quality and quantity, such as avatar auto-setup and texture generators. Benchmark emphasized that it supports developers through its content creation capabilities.
Additionally, AI-driven real-time chat translation expands global access. The company believes Roblox is a “standout” in an AI-driven environment, saying “substantial evidence shows that AI tools can accelerate online bookings, make them more secure and reliable, and reduce costs. There is.''