Stocks with high AI exposure and their market-implied growth assumptions – Citi

Stocks with high exposure to artificial intelligence have a “lofty, but not bubble-like” backdrop, and Citi analysts are estimating that the markets are pricing around 19-27% growth over the next five years.

But almost 60% of the market cap of the AI stocks group has market-implied growth rates that are above consensus, the most since 2019, according to a Citi Research Thematic Equity Strategy report.

“AI has been a huge driver of returns in the U.S., based on our Magnificent 7 contribution to S&P 500 (SP500) gains, as well as the global market, where AI exposed names have accounted for nearly 60% of MSCI ACWI (ACWI) returns year-to-date,” wrote Analyst Drew Pettit. “The concern is that price moves for AI are too aggressive.”

These are the high AI exposure single stocks and their market-implied growth assumptions:

Where consensus estimate is greater than market expectations:

• Meta Platforms (META) – Sell-side consensus: 35.47; Five-year FCF per share market-implied estimate: 35.47
• Advanced Micro Devices Inc. (AMD) – Sell-side consensus: 9.41; Five-year FCF per share market-implied estimate: 9.06
• Pinterest Inc. (PINS) – Sell-side consensus: 3.31; Five-year FCF per share market-implied estimate: 2.91
• Snap Inc. (SNAP) – Sell-side consensus: 1; Five-year FCF per share market-implied estimate: 0.78
• LG Electronics [Not covered] – Sell-side consensus:170,502; Five-year FCF per share market-implied estimate: 13,105
• Samsung Electro-Mechanics [Not covered] – Sell-side consensus: 141,83; Five-year FCF per share market-implied estimate: 8,424
• UiPath Inc. (PATH) – Sell-side consensus: 0.86; Five-year FCF per share market-implied estimate: 0.75
• Alchip Technologies (ALCPF) – Sell-side consensus: 638; Five-year FCF per share market-implied estimate: 285

Where consensus estimate equals market expectations:

• Alphabet Inc. (GOOGL) – Sell-side consensus: 11.68; Five-year FCF per share market-implied estimate: 12.14
• Amazon.com Inc. (AMZN) – Sell-side consensus: 12.45; Five-year FCF per share market-implied estimate: 12.86
• SK Hynix [Not covered] – Sell-side consensus: 18,577; Five-year FCF per share market-implied estimate: 23,654
• London Stock Exchange Group (OTCPK:LDNXF) – Sell-side consensus: 5.71; Five-year FCF per share market-implied estimate: 6.22
• Marvell Technology Inc. (MRVL) – Sell-side consensus: 4.14; Five-year FCF per share market-implied estimate: 5.02
• Super Micro Computer Inc. (SMCI) – Sell-side consensus: 35.81; Five-year FCF per share market-implied estimate: 47.37
• Vertiv Holdings Co. (VRT) – Sell-side consensus: 5.05; Five-year FCF per share market-implied estimate: 5.71
• BE Semiconductor Industries N.V. (OTC:BESIY) – Sell-side consensus: 8.49; Five-year FCF per share market-implied estimate: 10.21

Where consensus estimate is less than market expectations:

• Microsoft Corp. (MSFT) – Sell-side consensus: 18.63; Five-year FCF per share market-implied estimate: 29.04
• Nvidia Corp. (NVDA) – Sell-side consensus: 4.14; Five-year FCF per share market-implied estimate: 7.34
• Tesla Inc. (TSLA) – Sell-side consensus: 4.23; Five-year FCF per share market-implied estimate: 12.19
• Taiwan Semiconductor Manufacturing Co. (TSM) – Sell-side consensus: 51.89; Five-year FCF per share market-implied estimate: 86.55
• Samsung Electronics Co. (OTCPK:SSNLF) – Sell-side consensus:6,936; Five-year FCF per share market-implied estimate: 9,370
• QUALCOMM Inc. (QCOM) – Sell-side consensus: 12.92; Five-year FCF per share market-implied estimate: 17.71
• Microchip Technology Inc. (MCHP) – Sell-side consensus: 2.42; Five-year FCF per share market-implied estimate: 7.13
• WEG S.A. (OTCPK:WEGZY) – Sell-side consensus: 1.24; Five-year FCF per share market-implied estimate: 2.38
• NAVER Corp. (OTCPK:NHNCF) – Sell-side consensus: 7,138; Five-year FCF per share market-implied estimate: 11,648
• One97 Communications (ONSC) – Sell-side consensus: 4.51; Five-year FCF per share market-implied estimate: 14.51