As the artificial intelligence (AI) revolution plays out, there are 11 U.S. stocks that analysts at Goldman Sachs (NYSE:GS) believe will potentially benefit in the near term, “early winners” who have innovated and invested heavily in the technology and those who are enabling its commercialization.
First, the analysts pointed to the makers of semiconductors and related equipment needed to build AI technology, namely NVIDIA Corporation (NASDAQ:NVDA), Marvell Technology Group Ltd. (NASDAQ:MRVL) and Credo Technology Group.
Next are hyperscalers and mega-cap companies that can use their extensive cloud computing infrastructures to commercialize AI on a large scale: Microsoft Corporation (NASDAQ:MSFT), Alphabet Inc (NASDAQ:GOOG) and Amazon.com Inc (NASDAQ:AMZN).
Finally, the Goldman Sachs (NYSE:GS) analysts highlighted empowered users, being companies that are already using AI technology to amplify their businesses: Meta Platforms Inc (NASDAQ:FB), Salesforce.com, Inc. (NYSE:CRM), Adobe Systems Incorporated (NASDAQ:ADBE), ServiceNow and Intuit Inc. (NASDAQ:INTU).
“This group of ‘early winners’ has already appreciated sharply, returning roughly 60% year-to-date,” the analysts wrote in a note.
“Since many of these early winners are very large companies, the concentration of the returns in the equity market this year has been extraordinarily high: for example, just 15 companies in the US accounted for over 90% of the S&P 500 return between January and June of 2023.”
The analysts wrote that this group has driven valuations in U.S. technology stocks to an “unusual” premium relative to technology companies in other parts of the world.
“U.S. technology sector valuations have increased relative to those in Europe this year, suggesting that the AI narrative has been a key factor given that most of the leading companies investing in this space currently are in the U.S.,” they wrote.
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