This week, Nvidia became the fourth most valuable U.S. corporation, sparking a frenzy as AI stocks surged by 41% in 2024. Artificial intelligence is indeed experiencing its heyday, as seen by the Nasdaq 100, which reported a surge of 54% last year.

Despite the trend of job cuts in the industry in 2023, it’s off to a strong start in 2024 for technology. This year also appears to be continuing this massive growth trend, which is excellent news for some of the top AI stocks on the market.

There have been concerns among investors that the excitement around artificial intelligence might be exaggerated. However, there are ample reasons to maintain a bullish outlook. AI is only beginning to transform our daily lives, serving as a strong driving force for some of the top AI stocks.

Here are our predictions for the top five AI stocks this year.

1. Nvidia (NVDA)

It goes without saying that the California-based company has been doing exceedingly well. Currently, it is trading at $639, with a target price of $1,100. It started the year at $481.68 and has been steadily increasing.

Why is it worth considering? In December, Nvidia’s stock value saw a threefold increase, surpassing the performance of all other companies in the S&P 500. The significance of its chips has been vital during a global shortage.

According to the Nasdaq, Nvidia has the AI industry’s largest and most capable supply chain. It has the potential to become a $2 trillion company if interest does not wane. However, more and more companies aim to create their own line of AI chips including Samsung, Intel, and Google. Microsoft and Meta Platforms reportedly took 60% of the 500,000 chips sold by Nvidia.

2. Advanced Micro Devices (AMD)

Advanced Micro Devices stands as a significant competitor to Nvidia, with the potential to replace Nvidia as the chip supplier for Meta and Microsoft. These companies have publicly declared their intention to transition to AMD for their chip needs. With the M1 MI300x chips, AMD has a genuine opportunity to challenge Nvidia’s dominance and, at the very least, diminish its market lead.

The stock price increased in December after launching its new AI chips. AMD CEO Lisa Su discussed the new accelerator chip, which is a large graphics processor designed for AI-oriented servers, and said Microsoft and Meta had committed to using the chip.

Speaking to reporters following her speech, Su said the anticipated $400bn market for AI processors in 2027 left plenty of space for AMD. “We think we could get a nice piece of that.”

3. Palantir (PLTR)

Big data analytics company Palantir continues to have many bullish investors on its side. Its stock doubled in 2023 and remains popular this year. The latest Artificial Intelligence Platform (AIP) offers additional datasets for its private sector and government clients, which has been crucial for its defense revenue.

Both industries possess deep pockets, enabling the company’s commercial revenue to grow by 32% year-on-year, and its government revenue to increase by 11% to $324 million. Earlier this month, Palantir shares rose by more than 19% in after-hours trading after the company reported fourth-quarter earnings that beat analysts’ expectations for revenue.

4. UiPath (PATH)

AI’s role in enhancing workplace productivity will feature heavily this year. This is where UiPath comes in, as it helps enterprises to streamline repetitive tasks. Robotic Process Automation (RPA) technologies were being used as early as 2021, with UiPath offering 20 automation products on their website across groups such as Discover, Build, Manage, Run & Engage.

In the third quarter of fiscal 2024, ending October 31, 2023, UiPath reported sales of $326 million, marking a 24% increase. This growth is noteworthy, especially given the difficult economic conditions in 2023. UiPath also boasts a robust balance sheet, with $1.8 billion in cash and investments and no long-term debt. On top of this, they say they have more than 10,000 customers who provide $1.4 billion in annual recurring revenue.

UiPath is undoubtedly a key player to watch in 2024 and the years to follow for enhancing workplace automation and boosting efficiency.

5. Amazon (AMZN)

Amazon is another major player in the AI game; after all, Amazon Web Services (AWS) is the world’s leading cloud service provider. Training AI models demands substantial computing resources, and Amazon is actively expanding its toolkit and services to assist developers in creating AI applications on its platform.

For one, AWS is introducing chips designed in-house to its platform, such as the Graviton4 for general computing tasks and the Trainium2 tailored for AI projects. The e-commerce giant also plans to incorporate Nvidia’s upcoming H200 AI chip and more than 16,000 GH200 Grace Hopper Superchips aimed at the most challenging AI applications.

Not to mention, Amazon recently announced its Q4 2023 earnings, which were impressive. Total revenue surged by 14% to $170 billion, accompanied by substantial growth in cash flow and operating income.

However, it is a competitive field, as some of the wealthiest companies in the world, i.e., Microsoft’s Azure and Alphabet’s Google Cloud, are also positioning themselves as rivals. Nevertheless, AWS has consistently held a lead in market share for many years.

Featured image: Canva

Suswati Basu

Freelance journalist

Suswati Basu is a multilingual, award-winning editor and the founder of the intersectional literature channel, How To Be Books. She was shortlisted for the Guardian Mary Stott Prize and longlisted for the Guardian International Development Journalism Award.

With 18 years of experience in the media industry, Suswati has held significant roles such as head of audience and deputy editor for NationalWorld news, digital editor for Channel 4 News
and ITV News. She has also contributed to the Guardian and received training at the BBC As an audience, trends, and SEO specialist, she has participated in panel events alongside Google.

Her career also includes a seven-year tenure at the leading AI company Dataminr, where she led the Europe desk and launched the company’s first employee resource group for disabilities. Before this, Suswati worked as a journalist in China for four years, investigating censorship and the Great Firewall, and acquired proficiency in several languages.

In recent years, Suswati has been nominated for six awards, including the Independent Podcast Awards, International Women’s Podcast Awards, and the Anthem Awards for her literary social affairs show.

Her areas of speciality span a wide range, including technology, Diversity, Equity, and Inclusion (DEI), social politics, mental health, and nonfiction books.

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