2024-04-02 02:15:00
In addition to Nvidia and Broadcom, analysts at Bank of America Securities believe that investing in Marvell Electronics, Micron Technology and AMD also has profit potential.
Updated April 2, 2024 10:15 CST
Investing in Nvidia Corp. and Broadcom Inc. stocks is Bank of America’s most recommended way to bet on the artificial intelligence (AI) trend in the chip field, but several other chip companies may also have profit opportunities.
That’s the view of BofA Securities analyst Vivek Arya, who in a report on Sunday pointed to Marvell Technology Inc. (MRVL), Micron Technology Inc. (MU) and The potential of Advanced Micro Devices Inc. (AMD).
Arya believes that Marvell Electronics has compelling opportunities in the fields of electronic optics and application-specific integrated circuits (ASICs). An “Analyst Day” on April 11 might be a catalyst for Marvell Electronics stock; analysts may then highlight the company’s potential to win more than 10% market share in custom AI chips, as well as its dominance in electronic optical products. status; this is likely to become more important as AI clusters scale.
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Investing in Nvidia Corp. and Broadcom Inc. stocks is Bank of America’s most recommended way to bet on the artificial intelligence (AI) trend in the chip field, but several other chip companies may also have profit opportunities.
That’s the view of BofA Securities analyst Vivek Arya, who in a report on Sunday pointed to Marvell Technology Inc. (MRVL), Micron Technology Inc. (MU) and The potential of Advanced Micro Devices Inc. (AMD).
Arya believes that Marvell Electronics has compelling opportunities in the fields of electronic optics and application-specific integrated circuits (ASICs). An “Analyst Day” on April 11 might be a catalyst for Marvell Electronics stock; analysts may then highlight the company’s potential to win more than 10% market share in custom AI chips, as well as its dominance in electronic optical products. status; this is likely to become more important as AI clusters scale.
Granted, Marvell Electronics’ execution “has been erratic over the past few quarters,” but Arya said the company’s traditional business may bottom out in the short term. At the same time, Marvell Electronics ranks second in the market position in the field of AI networks, second only to Broadcom.
He also said that he is optimistic regarding Micron Technology and believes that as AI applications gradually land on people’s devices, Micron may stand out. Additionally, the development trajectory for high-bandwidth memory products looks attractive.
“Typically, new storage demand cycles are met with a supply response, resulting in inevitable inventory and price pressures,” he wrote. “High-bandwidth memory critical to artificial intelligence may be the first memory technology that will quickly eat into supply, consuming three times the number of wafers as traditional double data rate DRAM memory.”
Regarding AMD, Arya noted that he is not as bullish on the company as some who believe it might capture 20% of the AI accelerator market, but he still believes the chip market will benefit from the rising tide.
“AMD’s meteoric rise in the AI market, coupled with its acclaimed execution consistency, leads us to believe it can continue to maintain a 5%-10% share of the AI accelerator market,” he wrote. Even as the company is being attacked from three sides by Nvidia, custom chip makers and startups targeting niche use cases.
Arya has a buy rating on all three companies, calling them “junior Samurai AI” companies, though he noted that each company’s “valuation is noteworthy relative to its respective industry leaders, so it’s expected to There is greater share price volatility.”
(This article is translated from MarketWatch. MarketWatch is operated by Dow Jones, the parent company of The Wall Street Journal, but MarketWatch is independent from Dow Jones Newswires and The Wall Street Journal.)
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