The Artificial Intelligence Boom: What’s Next According to Goldman Sachs
The future of the artificial intelligence (AI) industry is starting to take shape, and according to Ryan Hammond of Goldman Sachs, there are still plenty of opportunities for investors to capitalize on this growing trend. In a note to clients, Hammond outlined the potential next steps for the AI industry and highlighted some stocks that may still be undervalued compared to their potential.
While well-known companies like Nvidia have been leading the way in the AI space, Goldman Sachs predicts that there will be three broad stages of the AI trade that are yet to come. The first phase will focus on the use cases around AI, with new winners emerging as the technology continues to evolve. The second phase will involve companies that build and maintain the infrastructure around AI, such as chipmakers, cloud providers, and other technology firms. The third phase will see companies incorporating AI tools to boost their revenues, and the final phase will see companies benefitting from the productivity gains created by AI.
Goldman Sachs has already observed signs that the market is anticipating these next steps, with some forward-looking AI plays gaining traction in the market. The note highlighted a list of “phase two” stocks, including tech giants like Amazon and major chip stocks like Broadcom. These companies have outperformed the S&P 500 over the past year and could be positioned for further growth as the AI industry continues to expand.
For investors looking to capitalize on the AI trend, Goldman Sachs also mentioned software companies like Intuit and Adobe, which are expected to see revenue gains from AI in the future. Additionally, companies like Pinterest, Tenet Healthcare, and Clarivate could see productivity gains from AI, driving earnings growth in the long term.
Overall, the AI industry is still in its early stages, and there is plenty of potential for investors to benefit from the growth of this transformative technology. By staying informed and looking for opportunities in emerging AI companies, investors can position themselves for success in this rapidly evolving industry.
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