Although it’s been red hot over the past year, the trade in artificial intelligence has not burned itself out. In fact, AI continues to be one of if not the biggest catalyst in the stock market. Most securities associated with AI are booming, with some stocks having more than tripled their share price in the last 12 months.
A few analysts are starting to worry aloud that a bubble might be forming in AI stocks. But, so far, investors seem unconcerned and continue to bid up the securities. For people who have sat out the AI rally up until this point, there is still time to get in and ride these stocks to future gains. Wondering about Wall Street’s favorite AI stocks? Here are three names that could make you filthy rich.
Super Micro Computer (SMCI)
Super Micro Computer (NASDAQ:SMCI) has just been added to the benchmark S&P 500 index. Inclusion in the S&P 500 comes after a blistering rally that has seen SMCI stock increase more than 1,000% in 12 months. The tech company is replacing home appliance manufacturer Whirlpool (NYSE:WHR) whose share price has declined 20% over the past year.
Super Micro Computer makes data centers that power AI models and applications. The company’s market capitalizationhas soared from $4.50 billion at the end of 2022 to nearly $60 billion today. So far in 2024, SMCI stock has gained 219% year-to-date. The company’s stock really took off in spring 2023 after it announced a partnership with leading microchip designer Nvidia (NASDAQ:NVDA).
Alphabet (GOOG, GOOGL)
Alphabet (NASDAQ:GOOG, NASDAQ:GOOGL) is back in the good graces of investors on media reports that Apple (NASDAQ:AAPL) is planning to license its Gemini AI technology for use in future iPhones. Gemini is Alphabet’s suite of generative AI tools, encompassing everything from chatbots to coding assistants. Apple plans to license the technology from Alphabet and build the Gemini AI engine directly into future iPhones.
For Alphabet, the licensing deal will help it monetize its AI products as competition heats up against rivals such as Microsoft (NASDAQ:MSFT). Media reports also claim that Gemini could power new features that will be released to the iPhone through software updates later this year. Apple is widely expected to launch iOS 18, a new operating system for the iPhone, at its developer conference in June of this year.
GOOGL stock has risen 45% in the last 12 months, including a 6% year-to-date gain.
Microsoft (MSFT)
There is lots of love on Wall Street for Microsoft. Analysts at Mizuho Financial Group (NYSE:MFG) just named Microsoft’s stock a “top idea” following news that the company plans to launch Copilot for Security, a new AI cybersecurity product, in April of this year. At Bank of America (NYSE:BAC), analysts raised their price target on MSFT stock to $450 a share from $430 previously.
The upgrades come as Microsoft asserts itself as a dominant player in AI. The company is cascading its AI technology across a range of products and services, from its Teams teleconference platform to its Xbox video games. Expectations surrounding its AI offerings have helped to push MSFT stock up 55% in the last 12 months, boosting its market cap to $3.11 trillion in the process and making it the world’s largest public traded concern.
On the date of publication, Joel Baglole held long positions in NVDA, AAPL, GOOGL and MSFT. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.com Publishing Guidelines.