artificial intelligence (Aye) Concept shares have gained momentum in the U.S. over the past year. The S&P 500 index has risen. Nvidia, which supplies popular AI chips, has seen particularly sharp gains.investPeople understand that even if the corresponding stock is hot and bubble, the AI ​​theme will not just be a flash in the pan. The Citigroup strategy team suggested that now is the time to prepare as quickly as possible for the next wave of the AI ​​​​market.

The Citigroup team, led by strategist Pettit, reminded investors that the risk of a “micro-bubble” has emerged in some corners of the stock market and that they should be cautious. Investors should review their core AI holdings to differentiate between the good and the bad. Eliminate the weak and stay strong. Fans of growth stocks in particular may be wondering what to do with stocks that have already seen impressive gains.

However, the Citi team believes that in the long run, the market for AI themes is still experiencing “structural growth.” Now it’s time to prepare the next phase of the AI ​​theme. It deserves growth-oriented and even value-oriented investors are advised to expand their betting horizons. It is recommended to look internationally and identify many foreign companies that have been overlooked so far, as “more stocks will participate in the rally over the next few years, and the distribution of earnings will widen as the AI ​​value chain is expected to improve.” Is.”

Currently, AI concept stocks generally focus on growth stocks, but some value stocks can still be found. “The key is to look for companies where AI investment can help improve fundamentals,” Citi said.

At the same time, he believes growth investors should take the approach of “buying AI stocks at reasonable valuations” and recommends that value investors look for stocks with low valuation multiples, or stocks that should grow profits but are undervalued. is less.

MarketWatch reported that Citigroup divided the AI ​​value chain into three types of companies: “enablers”, “creators” and “users”, and selected two recommendation lists for growth and value stock investors to reference.

The first list of “fair value” AI recommended stocks for growth investors is as follows:

●”Manufacturers”: AppLovin (stock code APP), Okta (OKTA), BILL Holdings (BILL), as well as Smartsheet (SMAR) and Wix.com (WIX) in the United States, Autoliv (ALV) in Europe andJapanTrend Micro (Japan Stock Code 4704).

●”Enablers”: Intel (INTC), Marvell (MRVL), Broadcom (AVGO), Zillow (Z), as well as America’s TechConnectivity (TEL), Europe’s BE Semiconductor (Netherlands: BESI) and Australia’s Goodman Group (GMG). ).

●“Users”: In the United States, there are Block, Viva Systems, Expedia, and MasterCard; In Europe, these include France’s Thales, Airbus and ABB; And in Japan, Nidec. formerly known as Nidec) and Panasonic.

The second list of AI value stock recommendations is as follows

●”Manufacturers”: Aptiv (APTV), DocuSign (DOCU), Electronic Arts (EA) in the United States, Capgemini (CAP) in France, and Toyota (7203) in Japan.

●”Enablers”: include Hewlett-Packard (HPQ), SS&C Technologies (SSNC) and NetApp (NTAP) in the United States, France’s Orange (ORA), KPN (KPN) in Europe, Sweden’s Hexagon (HEXA ), includes Canon in Japan. (Canon, Japanese stock code 7751) and NTT (9432).

●”Users”: Bank of New York Mellon (BK), Bank of America (BAC), Booking Holdings (BKNG), Siemens of Germany (SIE), Airbus (French stock code AIR), Zurich Insurance (Swiss) stocks in European stocks Code ZURN), and Japanese stocks include Nitto Denko (Japanese stock code 6988).

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