Following a significant 50 bps rate cut on September 18th, the (IXIC) saw a 1.47% surge. This surge resonates investor confidence in the positive impact of cheaper capital on tech companies, especially in a landscape shifting towards increased reliance on cloud computing and AI infrastructure.
This shift is vital as Big Tech surges ahead, investing more in property, plant, and equipment (PPE), becoming the backbone for smaller enterprises.
While these tech juggernauts wield substantial market cap weight, making them resistant to fluctuations, there are indications that the lowered interest rate environment could reignite their growth.
Amazon.com
Amazon.com Inc (NASDAQ:) has soared by 8.21% over the past month with a market cap now standing at $2.013 trillion, reminiscent of its triumphant June-July period when it breached the $2 trillion threshold.
Amazon’s expansion into multiple revenue streams, from e-commerce and third-party sellers to Amazon Web Services (AWS), advertising, subscription, and physical stores through Whole Foods and Amazon Go, has been remarkable.
Highlighting room for significant growth is Amazon’s prowess in AI. As we stand at the dawn of AI development, AWS is poised to attract forthcoming generative AI applications. Not only does AWS provide tailored infrastructure for AI workloads, but it boasts a full-stack for AI product development, exemplified by its AWS App Studio.
Moreover, with AWS’s stronghold in blockchain services, the extension to AI seems inevitable. Amazon’s monetization of content through ads has seen substantial growth, adding to the already robust revenue streams. Launching the AI Video generator for cost-effective ad deployments is set to further propel this revenue source.
With Amazon’s current stock price at $192.45 per share, and an average price target of $223.25 per Nasdaq data, investors stand to gain a potential 16% upside.
Advanced Micro Devices
Stepping into view is Advanced Micro Devices Inc (NASDAQ:), with its stock rising by 1.2% in the past month. Often overshadowed by Nvidia (NASDAQ:), AMD has shown resilience, particularly with its X3D series, utilizing 3D V-cache technology, garnering increased demand.
AMD’s market share hit a record high of 23.9% in Q1, signaling a promising trajectory. The company’s foray into AI is evident with the unveiling of MI325X AI chip, set to revolutionize the generative AI landscape. AMD’s strategic acquisition of ZT Systems signifies a concerted effort to challenge Nvidia’s dominance in the AI sphere.
AMD, underscoring its future prospects, projects substantial data center growth amounting to $400 billion by 2027 from $30 billion in 2023, offering investors a potential CAGR of 70%.
With AMD stock priced at $158.62 per share and an average price target of $190.25 per Nasdaq data, investors could seize a 20% potential upside.
Tesla
Tesla Inc (NASDAQ:) has made a resilient recovery to a positive 1.73% year-to-date, registering a remarkable 15% boost in the last 30 days, despite its roller-coaster ride tendencies in the tech sector.
Tesla, known for its capital-intensive high-tech automotive manufacturing at scale, remains significantly influenced by the Fed’s rate decisions. The current TSLA price at $253 hints at a return to pre-Twitter purchase levels.
The upcoming Robotaxi Event holds the promise of a transformative milestone that cou…%
With Tesla’s current price per share at $253 and the average price target reported at $210.56 per Nasdaq data, the impact of the Robotaxi Event and the imminent FSD (full self-driving) launch remain intriguing factors to watch.