No. of Recommendations: 2
From BofAMEGA-CAP TECHNOLOGY stocks are about to see a historic year-over-year increase in spending, driven by Artificial Intelligence, says Bank of America.
For Amazon, Google, and Meta, server & related infrastructure spend (which includes GPUs) is expected to jump a whopping +43% Y/Y
Overall capex for this group of 3 mega-caps is expected to jump +35% Y/Y
Despite the higher spend, BofA expects free cash flow to grow materially for the group over the same period, with Amazon's FCF projected to jump a stunning
+170% from 2023 to 2026 up to
$99 billion.
From WedbushWe are raising our price target on Microsoft to $550 reflecting incrementally bullish recent AI customer checks with a tidal wave of Copilot and Azure monetization now on the doorstep for MSFT. We have seen deal conversions for broader enterprise scale AI deployments "accelerating" in the field as the AI Revolution takes hold. We maintain our OUTPERFORM and MSFT is on our Wedbush Best Ideas List. We strongly view this as Microsoft's "iPhone Moment" with AI set to change the cloud growth trajectory in Redmond.
From JPMCJP Morgan Chase is naming Amazon its top pick, and calling it its best idea for 2024. They set a price target of $240 on AMZN, based on the strong fundamentals and the growth prospects when it comes to Amazon's anticipated performance here over the coming quarters.
Amazon has ~45% US e-comm share & should become the largest US retailer in 2024. We estimate that AMZN’s US GMV reached $491B in 2023 (+12.6% Y/Y, $505B including Physical Stores), driving 44.5% share of US e-commerce & 9.9% share of US Adj. Retail Sales. AMZN’s share gains of US e-commerce have exceeded +100bps for eight consecutive quarters, w/recent strength driven by 3P, record-fast SD1D delivery speeds, & expansion of the Prime ecosystem. For 2024, we project AMZN’s US GMV growing +9.8% Y/Y to $539B (+9.7% Y/Y including Physical Stores), w/AMZN’s share of US e-comm growing an estimated +73bps Y/Y to 45.2%. Current estimates suggest that AMZN will surpass WMT as the largest US retailer in 2024 driven by: 1) Growth in the above noted underpenetrated categories; 2) Faster delivery speeds, w/ Amazon delivering 7B SD1D units in 2023 & 2B+ SD1D units in 1Q24; 3) Prime flywheel, w/AMZN having ~323Me global Prime Members by the end of 2024; & 4) Strength of 3P (61% of units in 1Q) & FBA, w/support from Buy With Prime Shopify integration & Logistics-as-a-Service (LAAS).
https://finance.yahoo.com/video/jpmorgan-names-ama...
