On Tuesday, Wedbush analyst Dan Ives reiterated that the AI market is far from a bubble and still in the early stages of growth.
AI Boom Far From Over, Wedbush Analyst Says
"This is just the start," Ives said on CNBC's Closing Bell Overtime, while predicting that the tech bull market would continue for another two years.
He cited the example of Alphabet Inc. (NASDAQ:GOOG) (NASDAQ:GOOGL), saying that it was once viewed skeptically by many investors. However, it has benefited significantly from AI developments.
“The reality is AI is a tailwing for them,” adding that they are seeing similar momentum with Broadcom, Inc. (NASDAQ:AVGO), especially across the chip sector.
Year-to-date, Alphabet Class A shares are up by 70.74% while Class C shares have gained 69.77% during the same period, according to Benzinga Pro.
The Wedbush analyst also suggested that Apple Inc.'s (NASDAQ:AAPL) partnership with Google will be key to its AI strategy.
“Ultimately, I think Apple is really going to walk down the aisle with them from the Gemini partnership. That’s going to be their AI piece,” he said.
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Dan Ives Says Microsoft, Palantir Lead AI Stock Picks
During the call, Ives also called Microsoft Corp (NASDAQ:MSFT) as his top pick, calling it a "table-pounder." He cited the reason being Microsoft's dominant position in cloud and enterprise AI services.
Microsoft's first-quarter revenue rose 18% year-over-year to $77.7 billion, beating analysts' estimate of $75.3 billion. Microsoft's Cloud revenue reached $49.1 billion, up 26% year-over-year, with Azure and other cloud services growing 40% annually.
Microsoft shares are up 13.95% year-to-date.
Ives also mentioned Palantir Technologies, Inc. (NASDAQ:PLTR) for its real-world AI applications.
“I get the valuation worries, but that is really, I think, right at the epicenter of what we’re seeing,” he stated.
US Government Support Strengthens AI Market
The Wedbush analyst also spoke about the Monday executive order establishing the Genesis Mission, a government-backed AI initiative.
The initiative will unify federal data, high-performance computing and advanced AI into one platform to accelerate breakthroughs in medicine, defense and energy.
"For the first time in 30 years, [the] U.S. is ahead of China when it comes to tech," he noted.
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Disclaimer: This content was partially produced with the help of AI tools and was reviewed and published by Benzinga editors.
