Broadcom is seeing strong momentum in its AI segment, with Citi maintaining a Buy rating and a $480 price target, citing accelerating AI sales. Wells Fargo also upgraded Broadcom to Overweight, raising its price target to $430, anticipating growth from Google TPU and custom XPUs. RBC Capital initiated coverage with a Sector Perform rating and a $370 price target, noting Google TPU's impact but expressing some concerns about the long-term sustainability of opportunities with Anthropic and OpenAI.
Meanwhile, Meta Platforms is solidifying its position as a major AI powerhouse. The company is developing its own AI chips and constructing data centers to support its AI initiatives, including the Llama large language model. Meta plans substantial capital expenditures, projecting $70 billion to $72 billion in 2025, with further investments in 2026, to integrate new AI features and a virtual assistant into its applications.
Google's Gemini AI models have seen a dramatic increase in business sales over the past year, reflecting improved quality and a successful response to past criticisms regarding its position against rivals like OpenAI and Microsoft. RBC Capital also raised Alphabet's price target to $375.00, maintaining an Outperform rating, driven by expected growth from AI advertising momentum and an expanding market for small and medium-sized businesses.
In other developments, IREN is gaining attention after securing a $9.7 billion, five-year AI cloud contract with Microsoft, signaling a strategic shift from bitcoin mining to AI infrastructure. The company's stock has seen significant gains, including an 11.43% rise in one day. Palantir Technologies has also experienced massive growth, with its stock gaining over 2,000% during the AI revolution, and Citigroup analyst Tyler Radke raised its price target to $235, citing strong U.S. commercial segment RPOs and expected public sector growth.
However, not all AI-related news is positive. An analyst suggests selling Oracle Corporation stock, predicting downside risk as optimism for AI deals, including a $300 billion OpenAI deal, fades due to concerns about low profit margins and high debt. Super Micro Computer Inc. stock has also dropped to yearly lows due to accounting concerns, despite strong demand for its AI servers and its position to capture a large share of the $5.2 to $8.0 trillion AI data center market by 2030.
Looking ahead, Rolls-Royce is positioning itself to become a key supplier of electricity for AI data centers through its Intelligent Power Solutions division, which is developing micro-reactor technology. Additionally, other AI-focused companies like Rezolve AI, an agentic AI platform, are projecting significant growth, aiming for $500 million in annual recurring revenue by late 2026, while semiconductor company Aeluma expects $4 million to $6 million in revenue in fiscal 2026.
Key Takeaways
- Citi maintains a Buy rating for Broadcom with a $480 price target, citing accelerating AI sales, while Wells Fargo upgraded it to Overweight with a $430 target due to Google TPU and custom XPU growth.
- Meta Platforms plans to spend $70 billion to $72 billion on capital expenditures in 2025, with more in 2026, to boost its AI efforts, including developing its own chips and the Llama large language model.
- Google's Gemini AI models have seen a dramatic increase in business sales, indicating improved quality and stronger competition against rivals like OpenAI and Microsoft.
- RBC Capital raised Alphabet's price target to $375.00, maintaining an Outperform rating, driven by AI advertising momentum and growth in the small and medium-sized business market.
- IREN secured a $9.7 billion, five-year AI cloud contract with Microsoft, signaling a shift from bitcoin mining to AI infrastructure, with its stock seeing significant gains.
- Palantir Technologies stock has gained over 2,000% during the AI revolution, with Citigroup raising its price target to $235, citing $3.6 billion in U.S. commercial RPOs and expected 51% public sector growth by 2026.
- An analyst recommends selling Oracle stock due to concerns about low profit margins and high debt from a $300 billion OpenAI deal, estimating its true value at $133.14 per share.
- Super Micro Computer Inc. stock is considered undervalued despite strong demand for its AI servers, positioning it to capture a significant portion of the $5.2 to $8.0 trillion AI data center market by 2030.
- Rolls-Royce is developing micro-reactor technology to supply electricity for AI data centers, aiming to become a top power provider in the growing AI infrastructure market.
- Rezolve AI, an agentic AI platform, aims for $500 million in annual recurring revenue by late 2026, building on $200 million from over 650 customers in 2025.
Citi and Wells Fargo See Strong Future for Broadcom AI
On January 15, Citi kept a Buy rating on Broadcom Inc. with a $480 price target, citing accelerating AI sales. Wells Fargo also upgraded Broadcom to Overweight, raising its price target to $430, expecting growth from Google TPU and custom XPUs. RBC Capital initiated coverage with a Sector Perform rating and a $370 price target. RBC noted Google TPU momentum but expressed concerns about the long-term sustainability of the Anthropic ramp-up and OpenAI opportunities. Broadcom designs and supplies various semiconductor devices and infrastructure software solutions internationally.
Citi Predicts Strong Growth for Broadcom AI Business
On January 15, Citi maintained a Buy rating for Broadcom Inc. with a $480 price target. Analyst Mark Kelly believes Broadcom's AI segment will drive significant growth in the coming quarters. The company's semiconductor solutions are vital for AI infrastructure used in data centers and networking equipment. Broadcom also has a diverse portfolio in broadband, wireless, and industrial markets. Citi sees Broadcom as a strong long-term investment due to its accelerating AI sales and market position.
Citi Maintains Buy Rating for Broadcom on AI Sales
On January 15, Citi kept its Buy rating for Broadcom Inc. and set a $480 price target. This positive outlook is mainly due to the company's fast-growing AI sales. Citi considers Broadcom one of the best stocks for long-term investment. The firm established this new price target after a transfer of coverage.
Analyst Recommends Selling Oracle Stock Due to AI Concerns
An analyst suggests selling Oracle Corporation stock, predicting a downside risk as optimism for AI deals fades. The company's $300 billion OpenAI deal boosted obligations but raises concerns about low profit margins and debt. A valuation model estimates Oracle's true value at $133.14 per share, which is about 33% lower than its current price. High debt and potential outdated GPU investments challenge Oracle's chances for a quick recovery, supporting a Sell rating.
Super Micro Stock Undervalued Despite AI Server Demand
Super Micro Computer Inc. stock has dropped to yearly lows due to recent accounting concerns, even with strong demand for AI servers. The company's Data Center Building Block Solutions position it to capture a large part of the $5.2 to $8.0 trillion AI data center market by 2030. Analysts believe the stock is undervalued, with a Base Case FY27 EPS of $3.30 suggesting it should be worth more than $29. Wall Street's doubts create a chance for investors to buy shares before expected revenue and earnings beats through fiscal year 2027.
Meta Platforms Emerges as a Major AI Powerhouse
Meta Platforms, known for social media, is becoming a significant player in artificial intelligence. While not a chip designer like Nvidia or a cloud provider like Amazon, Meta develops its own AI chips and builds data centers for its AI work. The company also created Llama, a large language model available to others. Meta plans to spend $70 billion to $72 billion on capital expenditures in 2025, with more expected in 2026, to boost its AI efforts. These investments aim to add new features and a virtual assistant to its apps, keeping users engaged and increasing advertising revenue.
Rolls-Royce Powers AI Data Centers with New Technology
Rolls-Royce is set to become a top supplier of electricity for AI data centers as spending on AI infrastructure grows. The company's Intelligent Power Solutions division is developing micro-reactor technology, including small modular reactors or SMRs. These SMRs can provide a steady and efficient power source for data centers, even in remote areas. While still new, this technology has a huge market potential as AI continues to evolve. Rolls-Royce's investment positions it as a potential key player in the future of AI infrastructure.
IREN Stock Rises After Microsoft AI Cloud Deal and Upgrades
IREN is gaining attention after securing a $9.7 billion, five-year AI cloud contract with Microsoft. Analysts see this deal as a move away from bitcoin mining towards AI infrastructure. The stock has seen strong returns, including an 11.43% gain in one day and 44.84% over 30 days. The Benchmark Company upgraded IREN to Buy with a $7.00 price target, citing the Microsoft deal as a key driver. Despite a higher debt-to-equity ratio, analysts are mostly positive, with an average price target of $6.50, suggesting a 37.29% upside.
Google Gemini AI Sales Soar as Quality Improves
Google's business sales for its Gemini AI models have dramatically increased over the past year. This surge shows the improved quality of the Gemini models, marking a big change for Google's AI efforts. The company had faced criticism for falling behind rivals like OpenAI and Microsoft. This success indicates that Google's investments in AI research and development are paying off, attracting more businesses to its advanced AI capabilities. Increased adoption of Gemini by businesses could also lead to further advancements and refinements of the AI models.
Palantir Stock Predicted to Soar Over 30 Percent by Analyst
Palantir Technologies stock has seen massive growth, gaining over 2,000% during the AI revolution. Citigroup analyst Tyler Radke recently raised his price target for Palantir from $210 to $235, suggesting a 34% upside. Radke points to the company's $3.6 billion in U.S. commercial segment RPOs and expected 51% growth in its public sector business in 2026. Palantir's AI Platform, including Foundry, Gotham, and Apollo, serves businesses and government agencies like the U.S. Army and NATO. Despite its high valuation, Palantir's strong contracts and partnerships with top AI developers support its growth narrative.
RBC Raises Alphabet Target Due to Strong AI Ad Growth
On January 15, RBC Capital analyst Brad Erickson increased Alphabet's price target to $375.00, keeping an Outperform rating. Erickson expects growth from AI advertising momentum, an expanding market for small and medium-sized businesses, and connected TV advertising during the Olympics. Alphabet shares have risen about 50% in the past year, outperforming the S&P 500. Analysts are closely watching Alphabet's AI advancements, which could significantly boost its main advertising business. These factors provide a positive outlook for Alphabet's stock in the near future.
Three AI Stocks Poised for Big Wins in 2026
Three AI stocks are highlighted as potential big winners in 2026. IREN, which recently secured a $9.7 billion deal with Microsoft, is shifting from crypto mining to AI infrastructure and has a 1.4 gigawatt Sweetwater 1 site opening in April. Rezolve AI, an agentic AI platform, ended 2025 with $200 million in annual recurring revenue from over 650 customers and aims for $500 million by late 2026. Aeluma, a semiconductor company, saw its stock almost triple and expects $4 million to $6 million in revenue in fiscal 2026, with no long-term debt and $38 million in cash.
Sources
- Citi Bullish on Broadcom (AVGO) as Accelerating AI Sales Drive $480 PT
- Citi Bullish on Broadcom (AVGO) as Accelerating AI Sales Drive $480 PT
- Citi bullish on Broadcom (AVGO) as accelerating AI sales drive $480 PT
- Oracle: Sell Before The AI Bubble Bursts
- Super Micro: Likely The Most Hated AI Stock
- Could This Be the Most Misunderstood Artificial Intelligence (AI) Stock on the Market?
- Artificial intelligence (AI) infrastructure spending is rising. This stock could benefit.
- Assessing IREN (IREN) Valuation After Microsoft AI Cloud Deal And Analyst Upgrades
- Google’s Gemini Sees Skyrocketing Business Sales
- 1 Unstoppable Artificial Intelligence (AI) Stock to Buy Before It Soars More Than 30% in 2026, According to a Wall Street Analyst
- RBC Raises Alphabet (GOOGL) Target on AI Advertising Momentum
- 3 AI Stocks That May Be The Biggest Winners In 2026
Comments
Please log in to post a comment.