Apple Inc (AAPL) is the best AI stock for the second half of 2024

We recently published a list of The 10 best AI stocks for the second half of 2024. With Apple Inc. (NASDAQ:AAPL) ranking fifth on the list, the company deserves a closer look.

Wedbush Securities said in a new note that mega-cap technology stocks have 15% upside potential in the second half of 2024, driven by AI. Wedbush analyst Dan Ives, who beats the AI ​​drum and believes the AI ​​”party” is just getting started, wrote that the $4 trillion AI arms race is taking place between the major technology companies and GPU chips have become the new oil or gold in the technology industry.

Ives wrote that he expects the NASDAQ to continue to perform strongly in the second half of the year.

While Ives continues to expect the big tech stocks to lead the AI ​​market, he also believes the AI-led rally can extend to technology companies that have a strong “installed” base that can actually use generative AI applications and models.

Last month, speaking to CNBC, Ives said the bull market in the technology sector will continue for at least two more years. When asked what the threat to that bull market might be, Ives said China could pose a threat given the possibility of a “tech cold war,” but he believes it is a “limited threat.”

“It started with semiconductors, but now it has started to expand the demand and use cases” to other companies. Ives called the AI ​​boom the “fourth industrial revolution.”

We picked the best AI stocks from Wedbush’s recent note. The firm called some of these stocks the best picks for the second half of 2024, while it called others “oversold” tech stocks. With each stock, we mentioned the number of hedge fund investors. Why do we care about the stocks hedge funds invest in? The reason is simple: Our research has shown that we can outperform the market by mimicking the top stock picks of the best hedge funds. Our quarterly newsletter’s strategy selects 14 small-cap and large-cap stocks each quarter and has returned 275% since May 2014, beating its benchmark by 150 percentage points. (More details can be found here).

Apple Inc (NASDAQ:AAPL)

Number of hedge fund investors: 150

Apple is one of Wedbush’s Dan Ives’ top picks for the second half of 2024.

TF International Securities analyst Ming-Chi Kuo also said in a new note that Apple has a competitive advantage over others with its on-device AI.

Well-known Wall Street analyst and Managing Partner of Deepwater Asset Management Gene Munster recently caused a stir when he said in a post on Twitter that Apple Inc (NASDAQ:AAPL) is a better investment than Nvidia in the long run. Munster believes that owning Apple Inc (NASDAQ:AAPL) will yield a higher return next year because the market is “denying” Apple’s AI potential.

The story goes on

Apple Inc (NASDAQ:AAPL) trades at 26 times its 2025 EPS estimate ($7.22). While this multiple is higher than the industry average of 30, it does not show that the stock is overvalued considering Apple Inc (NASDAQ:AAPL) is projected to grow 6.40% in fiscal year 2025 and 10.50% annualized over the next five years.

Mar Vista Focus Strategy stated the following about Apple Inc. (NASDAQ:AAPL) in its first quarter 2024 investor letter:

Overall, Apple Inc. (NASDAQ:AAPL) ranks 5th on Insider Monkey’s list of the title The 10 best AI stocks for the second half of 2024. While we recognize the potential of Apple Inc. (NASDAQ:AAPL), we believe AI stocks promise higher returns and do so in a shorter period of time. If you’re looking for an AI stock that’s more promising than AAPL but worth less than five times its earnings, read our report on the cheapest AI stock.

CONTINUE READING: Analyst sees a new $25 billion “opportunity” for NVIDIA And Jim Cramer recommends these stocks.

Disclosure: None. This article was originally published on Insider Monkey.