Top 2 AI stocks set to smash the S&P 500 by 2030

As the artificial intelligence (AI) craze still runs high, offering plenty of opportunities for growth stocks to achieve outstanding returns, two particular AI-focused stocks might have it in them to outpace the S&P 500 index through the decade’s end.

Indeed, the market for AI technology, which covers a wide range of applications, could increase from $184 billion in 2024 to $826 billion by 2030, according to the June Statista report, and Finbold has narrowed down two AI stocks that could particularly benefit from this growth.

In this line, according to data obtained by Finbold, as of 2023, the estimated market share of AI is $207.9 billion, and this value is projected to surge by 788.64% to reach $1.87 trillion by 2030. The market share is anticipated to exceed the $1 trillion threshold for the first time in 2028 at $1.06 trillion.

#1 Palantir (PLTR)

Specifically, the first candidate is Palantir (NYSE: PLTR) stock, which has just joined the S&P 500 index itself and which Bank of America (NYSE: BAC) analyst Mariana Pérez Mora said was facing an analysis blunder like the one from 1980 that foresaw the cell phone market of only 900,000 users by 2000.

“We view Palantir’s (PLTR) capabilities, technology, and path forward facing a similar fundamental misunderstanding. (…) The upcoming S&P 500 inclusion provides a watershed moment for institutional investors to revisit what they ‘know’ about PLTR.”

With this in mind, Pérez Mora, who has tracked PLTR stocks since they were trading at a mere $6 per share, increased her 12-month Palantir stock price target from $30 to as much as $50, making it the highest rating provided by Wall Street analysis in the past three months.

At press time, the price of PLTR stock stood at $36.10, indicating a 0.64% decline on the day, an increase of 4.98% across the week, adding up to the 11.06% gain in the last month and the 117.71% advance year-to-date (YTD), as per data on September 17.

#2 Advanced Micro Devices (AMD)

Meanwhile, the other AI stock that might smash the S&P 500 by 2030 is that of Advanced Micro Devices (NASDAQ: AMD), the company directly competing with Nvidia (NASDAQ: NVDA) in the GPU segment and which announced new products to accelerate its AI roadmap.

Furthermore, Stifel applied technology analyst Ruben Roy observed that AMD’s merger and acquisition (M&A) activity in the last six to eight months included software-specific acquisitions such as a $4.9 billion deal on ZT Systems, placing AMD’s strategy only second to Nvidia’s.

“I wouldn’t say AMD necessarily is catching up to Nvidia overnight, but certainly it sounds to us looking at these acquisitions, that’s where the company strategy is focused, trying to become a number two player to what Nvidia has established.”

It is also worth noting that Citi (NYSE: C) analysts earlier stressed that the ZT Systems acquisition would allow AMD to better compete with Nvidia “in the data center GPU market via additional system experience and faster hyper scaler deployment times,” reiterating their ‘buy’ rating and a $210 price target.

For now, AMD stock is trading at the price of $151.90, reflecting a 0.33% decline in the last 24 hours while gaining 6.03% across the past seven days, dropping 2.20% over the month, and accumulating an advance of 9.61% since the beginning of this year, as charts demonstrate.

Conclusion

Ultimately, Palantir and AMD are strong competitors in the AI industry and might expect increasing stock prices in the future. However, trends in the stock market can change tremendously, so keeping up with any news, such as around Palantir earnings date and when does AMD report earnings, is critical.

Buy stocks now with eToro – trusted and advanced investment platform

Disclaimer: The content on this site should not be considered investment advice. Investing is speculative. When investing, your capital is at risk.