If You Invested in These AI Stocks, Booking Profits Now Can Be a Smart Move

An analysis of the current market situation for AI stocks, the reasons for booking profits, and the specific stocks to watch.

Points

• AI technology is expensive and must solve complex problems to justify costs.
• Analysts suggest booking profits in AI stocks due to market uncertainty.
• Key AI stocks to consider for profit-locking: AeroVironment Inc., SoundHound AI, and Nvidia.

AI technology, while promising, is exceptionally expensive and must solve complex problems to justify its costs. Despite its potential, some experts, including Daron Acemoglu from MIT, believe that transformative AI applications are unlikely to materialize soon. Additionally, Morgan Stanley’s chief investment officer, Michael Wilson, noted that a 10% market pullback is likely between now and the November elections, driven by prevailing uncertainty.

Market Sentiment and Analyst Recommendations

Although some analysts remain optimistic, the prevailing sentiment leans towards caution. Citigroup analysts, for instance, have urged investors to take profits in AI highfliers, indicating a potential downturn in the near future. This sentiment is echoed by Michael Wilson, who has correctly assessed stock market corrections in the past.

AeroVironment Inc. （NASDAQ: AVAV）

AeroVironment, known for its UAV technology, has seen its stock gain 166% since January 2020. However, despite beating revenue expectations for fiscal Q4 ‘24, the company reported a 57% decline in earnings per share and a $24 million backlog decline compared to the previous year.

SoundHound AI （NASDAQ: SOUN）

SoundHound AI, trading at $4.20, is above its 52-week average of $3.28 per share and well above its 52-week low of $1.49, making it a solid candidate for profit-locking.

Nvidia （NASDAQ: NVDA）

Nvidia remains a dominant force in the AI market, with its stock priced at $131, close to its all-time high of $135.58. Despite sound fundamentals, the significant gains make it a prime candidate for booking profits.

Conclusion

Considering the current market sentiment and the significant gains in AI stocks, booking profits now could be a prudent move. Investors should remain vigilant and consider locking in gains from stocks like AeroVironment, SoundHound AI, and Nvidia to mitigate potential risks.

解説

• Market Uncertainty: Current market uncertainty, driven by economic and political factors, makes booking profits in AI stocks a smart move.
• Stock Performance: Understanding the performance of key AI stocks helps investors make informed decisions about profit-locking.
• Expert Insights: Analyst recommendations and market sentiment provide valuable insights into the potential future movements of AI stocks.