- Despite the “brutal” week, Ives said in the interview that the period will be looked upon as an opportunity in the future as long as the AI companies follow through on their capex spending.
- Ives called Nvidia a “stunner,” citing its stellar results, and attributed the downturn in the stock to “nervous” tech investors.
- He highlighted that 10% of Azure customers have gone down the AI path, which he predicted would bring in an incremental revenue of $35 billion to $40 billion for Microsoft.
Dan Ives, managing director at Wedbush Securities, said on Friday that the software stocks under pressure may be at a turning point.
“I think software is going to start to bottom here, especially after the Anthropic event, Salesforce, ServiceNow and others,” Ives said in an interview with CNBC.
“These are the times to look at who are the winners on chips. Nvidia, AMD, Micron. Who are the winners on the hyperscalers side? Microsoft, Amazon, and others,” he said.
“AI ghost narrative where good is bad and bad is worse,” Ives added.
The Opportunity
Despite the “brutal” week, Ives said in the interview that the period will be looked upon as an opportunity in the future as long as the AI companies follow through on their capex spending.
He added that the outcome would ultimately depend on “where the spending is on the enterprise and the AI,” which he said would dictate the movement of these stocks over the next 12-24 months.
On Nvidia
Ives specifically elaborated on three stocks — Nvidia Corp. (NVDA), Microsoft Corp. (MSFT), and Amazon.com (AMZN).
The Wedbush Securities managing director called Nvidia a “stunner,” citing its stellar results. He attributed the downturn in the stock to “nervous” tech investors.
“This is a stock I’d expect should be $210-$215,” Ives said. “This is a turbulent period, but our thesis is unchanged,” he said, reiterating the firm’s bullish stance on the stock.
Shares of NVDA have declined about 9% since posting earnings on Wednesday, while having climbed more than 47% in the past year.
On Microsoft And Amazon
Ives also reiterated Wedbush’s take on Microsoft, one of the top picks of the year at the firm. He highlighted that 10% of Azure customers have gone down the AI path, which he predicted would bring in an incremental revenue of $35 billion to $40 billion for the company.
“Microsoft is probably the most disconnected stock that I’ve seen in the last few years relative to what it's trading at,” he said. “And I think numbers are significantly underestimated,” he added, saying it was a “massive head-scratcher” for trading below $400.
Ives also said that Amazon, in parts, has been the “most-attractive” it has been in the past four-to-five years, touting CEO Andy Jassy’s contribution to be working for the company.
MSFT shares have remained relatively flat in the past year, while shares of AMZN have risen 1% in the same period.
For updates and corrections, email newsroom[at]stocktwits[dot]com.
Also Read: Nvidia Shares Will Be Rewarding Over The Long-Term, Says Gene Munster, Citing Strong Fundamentals