A.I. excitement leads to winning week for Nvidia and other tech stocks
Artificial intelligence plays led the stock market higher this week, as excitement over Nvidia's blowout earnings beat lifted other tech names. Nvidia surged 24.4% Thursday alone after the AI chipmaker gave a sales forecast for the current quarter that was more than 50% higher than what analysts were expecting. The semiconductor company also topped fiscal first-quarter earnings and revenue estimates when it reported after the bell Wednesday. Nvidia CEO Jensen Huang said Nvidia was experiencing "surging demand" for its data center products. The news prompted investors to pile into other stocks they thought would benefit from AI, leading many of those names to be among the biggest weekly winners. Here are the top 10 gainers in the S & P 500 this week. Data is current as of Friday morning. Nvidia's massive outperformance led the stock to an all-time high Thursday and closer to a $1 trillion market cap . As of Friday morning, the AI darling is up nearly 22% week to date and still has 11% upside to the average analyst price target, per FactSet. Its earnings blowout led several analysts to boost their price targets on Thursday, with both JPMorgan and Evercore ISI raising their targets to $500 per share. Monolithic Power Systems also rallied, up about 21% so far this week. However, it has about 3.5% downside to the average analyst price target. Some 77% of analysts covering the stock rate it a buy, including Quinn Bolton at Needham. Bolton recently highlighted Monolithic, which provides power management solutions for Nvidia's H100 graphics processing units, as an under-the-radar AI play . Meanwhile, Advanced Micro Devices gained nearly 18% week to date but has 15% downside to the average analyst price target. Of the analysts covering the stock, 57% give it a buy rating. One of those, Raymond James' Srini Pajjuri, called AMD an " underappreciated play on AI/ML ." The company makes graphics processing units that underpin most generative AI tools. Hedge fund manager Dan Loeb, CEO of Third Point, has also taken a stake in the chipmaker , filings show. Lastly, Arista Networks has added nearly 15% so far this week and has another 4% upside to the average analyst price target. Some 56% of analysts covering the stock rate it a buy. The networking company provides the infrastructure to support AI data. Among those bullish on the stock is Piper Sandler analyst James Fish, who wrote in a note in April, "Arista is in a prime position to benefit from the AI driven demand." — CNBC's Samantha Subin and Michael Bloom contributed reporting.
Source: CNBC
