Analysts at Goldman Sachs have published their outlook for providers of IT Hardware and networking products for 2024, projecting significant advancements in AI technology adoption.
Arista Networks (NYSE: ANET) is highlighted as a top choice, expected to benefit from the increasing capital expenditure at major hyperscale clients such as Microsoft and Meta. Moreover, the company’s efforts to promote Ethernet as a foundational component of AI networking infrastructure are recognized as pivotal.
Furthermore, Dell Technologies Inc. (NYSE: DELL) is identified as a firm poised to capitalize on the rising demand for AI servers, particularly as infrastructure investments expand beyond hyperscale entities to encompass AI cloud service providers and eventually enterprise customers.
Bank of America analysts have designated NVIDIA Corporation (NASDAQ: NVDA) as a leading pick in the semiconductor sector, citing the company’s anticipated “genAI dominance” that could potentially generate an incremental $100 billion in free cash flow over the next couple of years (CY24/CY25E). NVDA’s robust dividend yield is seen as a strategic advantage that could bolster its valuation multiples.
Conversely, DA Davidson analysts have initiated coverage on NVDA with a price target of $410 per share and a Neutral rating.
In a separate development, analysts at Morgan Stanley engaged in conversations with Stanford University authorities regarding AI governance principles, shedding light on the complexities and challenges surrounding the regulatory landscape.
While acknowledging the transformative potential of AI technologies, analysts caution that the regulatory framework in the United States may encounter significant hurdles, including information disparities between government entities and businesses, as well as resource constraints within federal agencies.
Recent market updates indicate that MongoDB (NASDAQ: MDB) and Palantir Technologies Inc (NYSE: PLTR) experienced rating downgrades following their notable AI-related growth in 2023. UBS downgraded MongoDB due to concerns about database revenue impact from AI applications in 2024, while Jefferies lowered Palantir’s rating to Neutral, citing inflated valuations driven by AI market exuberance.
UiPath, recognized for its prowess in automation technologies, received favorable coverage from William Blair analysts. The company’s platform, designed to streamline manual workflows through API-based automations, is positioned as a leader in process automation and optimization markets, catering to complex enterprise-grade processes with a high gross retention rate of 97%.
In conclusion, industry experts anticipate sustained growth and profitability for UiPath in the foreseeable future, underpinned by its innovative solutions and market positioning.
