Nvidia: AI Hardware Kingpin Ready to Triple Production:
Generative AI was the game’s name in 2023, and Nvidia, the undisputed AI chip king, rode the wave like a champion. Its 245% stock gain was no fluke, fueled by its dominant market share and explosive revenue and earnings growth. With fiscal 2024 revenue on track to hit $59 billion (a staggering 118% leap), Nvidia’s pricing power is on full display, especially with its flagship H100 AI card commanding prices between $25,000 and $40,000.
And guess what? Nvidia isn’t resting on its laurels. To maintain its dominance and capitalize on the projected 25% jump in AI chip revenue in 2024, it’s securing more components like never before. Reports of hefty prepayments to memory manufacturers and a new HBM chip contract with Samsung confirm their aggressive supply chain strategy. This could triple H100 production in 2024, pushing analysts to forecast a 56% revenue jump and 67% earnings surge next year. With a PEG ratio of just 0.5 (a bargain in valuation terms), Nvidia is a no-brainer buy for AI-savvy investors.
Amazon: E-commerce and Cloud AI Powerhouse With Growth Runway:
E-commerce and cloud computing giant Amazon’s 77% stock gain in 2023 wasn’t just about impressive past performance; it’s about future potential. With 2023 revenue on track to hit $568.5 billion (an 11% increase), Amazon’s growth story remains compelling, as evidenced by projections of strong growth in 2024 and 2025.
But wait, there’s more! The global e-commerce market is expected to expand 9.4% in 2024, and Amazon has consistently outpaced this growth. With AWS, the industry-leading cloud infrastructure service (32% market share), Amazon is perfectly positioned to capitalize on the burgeoning cloud AI market, projected to grow 36% annually until 2032. Companies like BMW, NatWest, and PwC are already using AWS AI offerings to integrate AI into their operations, and this trend is just beginning.
Trading at 2.9 times sales compared to its five-year average of 3.4, Amazon offers a relative bargain entry point. With another solid year for the Nasdaq-100 predicted and lucrative catalysts like AI e-commerce and cloud services driving growth, this tech giant could soar in 2024. Investors should take notice and consider climbing aboard.
