Is the AI stock craze a bubble waiting to burst? | AI Weekly Review
AI Weekly Review![]()
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1.Nvidia's data center demand was underestimated, and Wall Street raised its target price.
2.The Philadelphia Semiconductor Index soared to its highest level in 14 months.
3.Nvidia's big move ignited the gaming sector, a new round of industry outbreak is imminent?
4.Is it too early to call the AI stock craze a bubble as retail investors are still holding back？
5.Looking ahead to this week's financial report lineup for AI companies: C3.AI, Dell, Broadcom.
1.Nvidia's data center demand was underestimated, and Wall Street once again raised its target price![]()
$NVIDIA (NVDA.US)$data center demand was underestimated, and Wall Street once again raised its target price. After Nvidia recently released surprising strong performance prospects, the stock price soared. It is reported that Nvidia expects second-quarter revenue to reach around US$11 billion, which is 53% higher than the market's expected US$7.18 billion. This optimistic forecast has pushed Nvidia's stock price to a historical new high and made its market value soar close to the $1 trillion mark.
Analysts have raised their target stock prices for the company, expecting Nvidia's leading position in the industry to be unshakable in the short term. Srini Pajjuri, managing director of Raymond James, believes that there is a war going on in the AI field, and Nvidia is the only arms dealer.![]()
2.The Philadelphia Semiconductor Index soared to its highest level in 14 months![]()
The AI boom has triggered a chip stock frenzy, and the $PHLX Semiconductor Index (.SOX.US)$, which tracks the world's 30 largest semiconductor manufacturers, soared to its highest level in 14 months this week.
In an article a month ago, we pointed out the trading opportunities in the $PHLX Semiconductor Index (.SOX.US)$ (Missed the AI rally？Chip stock is on the rise). Huatai Securities believes that the current global semiconductor cycle may be bottoming out, and the technological development brought by AI is expected to resonate with the cycle, which will be more favorable if US consumption recovers as soon as possible.
In fact, as Deutsche Bank pointed out in its research report, all companies involved in AI this year have easily outperformed the $S&P 500 Index (.SPX.US)$.![]()
3.Nvidia's big move ignited the gaming sector, a new round of industry outbreak is imminent?![]()
On May 29th, $NVIDIA (NVDA.US)$ announced on its official website that it will provide customized AI outsourcing services for games - Avatar Cloud Engine (ACE) for Games, which can develop AI models that run on the cloud and PC.
According to their introduction, this service can use AI-driven natural language interaction to bring intelligence to NPCs, thereby revolutionizing the game. Developers can use ACE services to create and set up customized language, dialogue, and animation AI models in their software and games.
When generative AI completely changes the way players interact with game characters (NPCs), has Nvidia made the metaverse a reality?![]()
CITIC Securities believes that the gaming industry has natural adaptability with AIGC and is expected to bring a new round of industry outbreak.
Firstly, AIGC will reduce production costs, improve quality, and increase efficiency, breaking the impossible triangle of "quality, efficiency, and cost" in the gaming industry. Secondly, it will create new gameplay and experiences, and AIGC is expected to bring revolutionary improvements in content quality. Thirdly, AIGC is expected to significantly increase the supply of high-quality games.
4.Is it too early to call the AI stock craze a bubble as retail investors are still holding back？![]()
Goldman Sachs partner and senior trader John Flood recently revealed that in the past three weeks, after Apple announced better-than-expected first-quarter earnings reports, buyers from mutual funds continued to buy blue-chip technology stocks. In other words, mutual funds chasing blue-chip technology stocks are the driving force behind the recent rise in the US stock market.
VandaTrack also believes that institutional investors are the "main source" of demand for AI stocks, and the interest of retail investors has only "slightly increased."
Based on various Google Trend search queries, DataTrek's recent report shows that the keyword "ChatGPT" far exceeds the search interest in Bitcoin, and the keyword "technology stocks" continues to decline from its peak in February 2021.
This means that the interest in "technology stocks" has not reached the level of the speculative technology bubble period during the heyday of popularization.
Jessica Rabe, co-founder of DataTrek Research, said: This means that institutional investors may have been driving the recent rise in AI-related technology stocks, which means that there is still great potential for further growth if retail investors participate more in this field. ![]()
However, given the significant impact of AI on all aspects of business, and the substantial content of AI compared to the previously hyped trends around metaverse, cryptocurrency, and Web 3.0, it is suggested that AI stock speculation is not yet a bubble.
5.Looking ahead to this week's financial report lineup for AI companies: C3.AI, Dell, Broadcom![]()
Due to the large earnings beat, previously AI concept stocks such as $NVIDIA (NVDA.US)$ and $Marvell Technology (MRVL.US)$ have experienced soaring stock prices. There are three more AI stocks releasing their earnings reports this week, which investors can closely monitor.
$C3.ai (AI.US)$, as an enterprise artificial intelligence software company, Wall Street will focus on C3.ai's growth and prospects in its earnings report on Wednesday, May 31st.
Founded in 2009, C3 is committed to accelerating digital transformation through the development and operation of large-scale artificial intelligence, predictive analytics, and IoT applications. C3 launched its IPO in 2020, and with the strong momentum of the AI revolution, it seems to be slowly but steadily crossing the profit line.
Due to the market's optimism about artificial intelligence, C3's stock has risen by 192% so far this year, even surpassing Nvidia's 166% and Dell and broader indices.
This iconic technology solutions company is rapidly expanding into the field of artificial intelligence. In fact, Dell has collaborated with Nvidia on its generative AI risk project, Project Helix. Project Helix will help businesses use AI models to provide better customer service, market insights, and corporate research.
Dell's stock has risen by 20% this year, higher than the S&P 500 index's 9% and the IT services market's 7%, but slightly lower than the Nasdaq index's 24%.
Chip giant $Broadcom (AVGO.US)$will release its earnings report after the market closes on June 2nd.
Previously, Apple announced that it has reached a billion-dollar agreement with Broadcom to jointly develop 5G radio frequency components, causing the stock to soar by 11.52% that day, and the intraday stock price hit a historical high of $814.98, an increase of more than 46% this year.
In addition, Broadcom has previously released a new chip product - Jericho3-AI chip, which is used to connect supercomputers together and perform AI work using widely used networking technologies. According to reports, this chip can connect up to 32,000 GPU chips together and compete with another supercomputer networking technology called InfiniBand. Currently, the largest manufacturer of InfiniBand equipment is Nvidia, which acquired Mellanox, an InfiniBand field enterprise, for $6.9 billion in 2019.
Disclaimer: Moomoo Technologies Inc. is providing this content for information and educational use only.
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虎拳道 :
Fundamentalist : Run
Investors_unite : Ai is still in its initial stage, there is a bubble no doubt but the bubble is just forming. It's going to last more than a while .
Oldhead : Very likely.
1994CM : Long term benefits
Chyemm : Nice sharing
Chyemm : Bubble will not happened.
01001010 : I’d still join in knowing it can be a bubble. There are still gains to be in early because we don’t know if and when it’ll burst.
71504463 : The future of AI is unclear; I'm just waiting. What products should these so-called giants in the field of intelligence come up with to bring convenience to people
101772986 :