Artificial intelligence (AI) is capturing the spotlight on Wall Street, drawing increased attention and contributing to positive market sentiment. The impressive quarterly results from NVIDIA have intensified the excitement, showcasing the surging demand for its AI chips. Beyond NVIDIA, investors can explore several other stocks providing exposure to the AI sector, including Vertiv, Arista Networks, and IBM. Let’s delve into each of these companies for a closer examination.
**Arista Networks:**
Arista Networks has witnessed a substantial uptick in its shares, experiencing nearly a 120% surge over the past year amid the AI fervor. As a leading player in data-driven networking for large data centers, the company has seen analysts raising their fiscal year expectations. The Zacks Consensus EPS Estimate of $6.55 indicates a 25% increase over the past year, signaling robust 43% year-over-year growth. Arista Networks is scheduled to release its quarterly results on February 12th, with anticipated expectations of 21% earnings growth and a 20% increase in sales. The company’s strong performance in the enterprise, cloud, and AI sectors has contributed to its remarkable growth.
**Vertiv:**
As a global leader in critical infrastructure for data centers, Vertiv has witnessed a surge in its stock following a string of robust quarterly results. Analysts have raised their expectations across the board, elevating the stock to a Zacks Rank #1 (Strong Buy). Vertiv’s impressive FY23 guidance indicates a substantial 230% earnings growth on a 20% increase in sales. The company’s CEO, Giordano Albertazzi, highlighted the growing demand for data center infrastructure to meet the computing needs driven by AI. Vertiv’s recent financial strength is underscored by its ‘A’ Style Score for Growth.
**IBM:**
IBM, a stalwart in the tech industry, has garnered a positive market response to its latest quarterly results. The company emphasized the accelerating demand for AI, reporting revenue growth in all segments. IBM’s AI offerings, including watsonx and generative AI, experienced significant growth from the third to the fourth quarter. Apart from its AI exposure, IBM also stands out for its healthy dividend yield of 3.8%, complemented by an 0.8% five-year annualized dividend growth rate.
**Conclusion:**
The AI frenzy continues to dominate market discussions, with companies increasingly recognizing its transformative potential. Alongside their AI exposure, all three stocks mentioned boast a favorable Zacks Rank, reflecting the optimistic sentiment among analysts regarding the technology’s prospects.
As the AI landscape evolves, these companies position themselves to capitalize on the growing demand for AI-related technologies and services.
