The tech sector continues to soar as artificial intelligence gains ground. That isn’t the only story but it is one of the primary reasons that up and coming tech stocks could become the next superstars.
Thematic investors continue to pile into all things artificial intelligence and machine learning. The sector isn’t without problems as many participants have yet to identify ways to monetize their products and services. Yet, the future continues to remain bright.It is the most obvious sector from which the next tech giants will emerge.
Meanwhile, there’s also other factors to consider when identifying viable Tech stocks. Fintech continues to shape the future of technology as it does e-commerce and many other verticals. The company’s discussed below touch on all of those sectors and more and are worth considering for investors who seek to identify the stars of the future.
AMD (AMD)
AMD (NASDAQ:AMD) is certainly an up and coming stock after having grown rapidly since late 2023. It may already have reached superstar status but is worth discussing regardless.
The good news for investors who have yet to purchase AMD is that it is undertaking something of a pause at the moment. Some would suggest that that is a greater sign of a downturn in the AI chip sector. Just as many would counter that it is an opportunity. I would agree with them.
The question is whether AMD truly has the potential to compete with Nvidia (NASDAQ:NVDA) and potentially overtake it. Articles like this one suggest that the battle for AI chip dominance is not a winner takes all type situation. That suggests that AMD doesn’t necessarily have to usurp Nvidia’s dominant position in order to succeed.
Instead, AMD can continue to do what it has done. the company has already proven that it has the power to unseat titans given what it did to Intel (NASDAQ:INTC). So, it may simply succeed in that regard and overtake Nvidia. Even if it doesn’t there’s enough room for it to play.
CEO Lisa Sue anticipates that the chip Market will reach $400 billion by 2027. That is indeed a large opportunity that should provide for multiple winners.
SoundHound AI (SOUN)
SoundHound AI (NASDAQ:SOUN) is very clearly poised to be among the next tech stock superstars. The primary reason to believe that is a recent filing from Nvidia that showed it had invested in SoundHound AI.
The company primarily focuses on speech recognition technology and currently serves restaurants and call center clients.That’s something of a deviation from the generative AI frenzy which primarily focuses on creating text and images through AI.
SoundHound AI is more focused on what is known as conversational AI which deals with mimicking human language. Nvidia’s investment in the firm is an indication of where the leading chip supplier believes growth is likely to spring from next.
The company has another catalyst on the horizon as it is scheduled to present at Nvidia’s upcoming Tech conference scheduled for March 18. SoundHound AI’s recent strong trajectory suggests that it may be gearing up to release groundbreaking news that could fundamentally change its status.
Marvell Technology (MRVL)
Marvell Technology (NASDAQ:MRVL) is a semiconductor stock and a firm that primarily deals with networking and data infrastructure. Those areas are broadly connected to the recent artificial intelligence boom which also brought its shares higher.
A lot of that recent progress had been attributable to the Boom in AI data center related investment. it has been one of the strongest performing areas overall within AI. However, outside of that, Marvell technology recently showed some weakness.
Essentially, the company noted that it sees weakening demand during the first quarter for other non-data center related AI sectors. That led the company to provide weaker than anticipated guidance moving forward. However, certain analysts believe that Is an opportunity as the company is leveraged in those weaker AI areas which are predicted to grow in the future. In other words, Marvell technology is a broadly diversified AI chip firm with multiple ways to win moving forward.
Palantir (PLTR)
Palantir (NYSE:PLTR) has exploded onto the scene over the past few years making a name for itself among tech stocks in the process. During that period volunteer has basically gone from an anti Silicon Valley analytics firm that few believed in to a company that has quickly become profitable.
Palantir found initial profitability in early 2023 and continued to do so quarter after quarter. The result was that 2023 was its first profitable year primarily due to the emergency of AI.
It has carved out a strong position as a leader within the big data analytics sector and is one of the firms that is most closely connected to the government. In short, Palantir is the clear leader in public firm data analytics. There’s also reason to believe that it will continue to carve out a niche in emerging areas such as the confluence of the defense sector and AI.
MercadoLibre (MELI)
MercadoLibre (NASDAQ:MELI) is already a superstar stock in Latin America. The firm which is often compared to Amazon (NASDAQ:AMZN) is also both an e-commerce and fintech giant. Its topline growth over the past few years has been very impressive and that has resulted in Shares that are currently priced around $1,550.
Let’s dig down a little deeper to see what it looks like in the recent quarter. Revenues grew by more than 40% in the fourth quarter. broken down further the results were even more impressive. E-commerce volume grew by almost 30% while fintech results particularly shined. Total payment volume increased by 104% during the quarter.
Mercado Libre has established itself as a dominant fintech player in the region with services such as Mercado Pago which work as part of a holistic business that increases the ease of payment and the ease of shopping.
For those who worry that MELI is currently priced perfectly, there appears to be plenty of upside ahead.
Bitdeer (BTDR)
Bitcoin (BTC-USD) mining stocks are hot at the moment and Bitdeer (NASDAQ:BTDR) is among the best within that category.
With the price of Bitcoin recently surpassing all time highs mining firms like Bitdeer have become increasingly interesting. Bitdeer is interesting because it is well diversified and also because it is amongst the lowest all in cost miners of Bitcoin.
It cost the company roughly $17,750 to mine a single Bitcoin. That’s a particularly low price and one that is very attractive given that Bitcoin has recently searched above $70,000. The company derives the majority of its revenues from Bitcoin mining directly. However, the company also derives substantial revenues from general hosting and membership hosting.The result is that despite its low Mining cost the company continues to lose money.
Regardless, but dear is well positioned and could foreseeably become a tech Superstar should Bitcoin continue to move upward. Some have suggested that it could eclipse the $100,000 threshold in the near future. The upcoming Bitcoin halving may expedite that process. In any case, bit deer is interesting for the sheer fact that it mines Bitcoin at a much cheaper price than any of its rivals.
ARM Holdings (ARM)
ARM Holdings (NASDAQ:ARM) is a critical supplier to the tech world and a stock to watch for that simple reason. The company makes much of the central processing units that are integral to the production of chips. It is the counterpart to Nvidia’s dominance of the GPU field. That’s part of the reason in video made a bid to buy the company several years ago and also part of the reason it was stricken down on antimonopoly grounds.
In short, ARM Holdings is a critical link in the semiconductor supply chain and thus a critical part of the ongoing artificial intelligence opportunity.
The stock is likely to experience a period of volatility following the expiration of the IPO lockup. That expiry date will occur on March 12. more conservative investors may want to wait until that date has passed in order to see how the volatility plays out. Regardless, ARM Holdings will remain a vital link in the licensing of IP throughout the chip sector.
On the date of publication, Alex Sirois did not have (either directly or indirectly) any positions in the securities mentioned in this article. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.com Publishing Guidelines.
