This is Bigger Than Nvidia. These 4 Stocks Win the Next AI Boom.

AMD's new chips launched [music] this quarter, but they're not the only company that could benefit. Joining us today is market beat analyst Thomas [music] Hughes, who's sharing a list of four other stocks that are going to benefit from AMD's new chips. Thomas, so glad to have you here. I think this topic is a really good one today. I know you've been bullish on AMD for a while. So, we're going to get into what you think about this new product launch and what it will mean for AMD. But I think what's more important that we're going to discuss today is that whole ecosystem of other companies in the AI story that are really going to benefit from this new product launch for AMD. It's something that uh we've definitely seen in the market before. So, let's talk about kind of this ecosystem and how one new product launch like the chips that AMD is making right now can kind of have that trickle down effect in the whole market. >> Well, right. Just look at Nvidia. Nvidia is the source of AI. It's the source of the GPU boom today. But it's not the only one benefiting. It has its own ecosystem. There's the it doesn't make the chips. That's Taiwan's semiconductors. It doesn't package the chips. That's companies like Fabernet. You know, it's not making the connectivity devices. That's companies and its ecosystem. We can see it investing in that ecosystem. All those companies are benefiting. This is the same story with AMD's Mi450. Uh this story has been building for over 2 years. uh since the AI boom really started happening, the first mover advantage that Nvidia really had was the advanced nature of its GPU system. It had rack scale capability. It had uh the uh the adjacent software and operating system to enable the parallel computing and that's what AMD has been working on those last couple of years and that's what's coming to market this quarter. It's the MI450 line, but more importantly the Helios rack scale systems, which means that it can deliver AI capable supercomputers at hypers scale demand, a hypers scale scale, which elevates it alongside Nvidia, and it's really, really going to be a really huge market. The estimates are really phenomenally large. >> Yeah, this is a product launch you've been talking about for well over a year on this channel. I know you've been very excited about this launch and have been very bullish on AMD largely because of this launch. some questions I have. Let's talk about how big of a growth story this could be for AMD. Talking about the valuation of this company, uh price to earnings, those sorts of things. But also, I I want to acknowledge that AMD is up 172% in the last year, up 125% just since January. And so wondering if all of the benefits of this new Helios system are already priced into that growth that we've seen in the stock in the last year, or if you think that there is still quite a bit of growth yet to come for AMD. I think that there is still quite a bit of growth left to come for AMD. If you assume that AMD's business is going to match Nvidia's, it is still grossly undervalued compared to what Nvidia has done. So, as it sells and unlocks this revenue and turns it into earnings, we should see the stock price, you know, follow suit. And in that regard, there is a triple digit upside potential. But within all of this, Nvidia's chips are more suited for for model training. And right now that's what's driving the GPU the data center built out is the quest to build these supercomputers to train models so that we can have the models to do all the AI super awesome stuff. AMD's chips are better suited for inference which is the the next shift the next wave. Once we have the model training computers done and the models are ready to go they're going to be spitting out these apps that mean inference and inference is just the AI doing what it does thinking about things and spitting out answers. A&D's chips are better suited for that. And it's it's estimated to be a far larger market than the model training market. So you have to think in kind of a hub and spoke kind of a system where like if you have a model training supercomput that's spitting out your models and your your brains, you might need a dozen inference computers to handle all the traffic that the internet is going to generate or businesses to your models. So in this the forecast for AMD for the inference market is at least doubling the model training um infrastructure market. So the sales window is really huge. AMD's business could easily outstrip Nvidia's um if not for a sustained period of time at least um in the initial rollout phases as MI450 and Helios really you come to market and are scaling up. Now, before we move on to that whole ecosystem that you were talking about there and all the other stocks that are going to benefit, which is the main point of this video, I want to dive into it a little bit more on AMD, and that's just looking at some of the analyst coverage here and talking about that expected growth in the next year. That would assume we're pricing in some of the benefits of this new product launch if we're looking 12 to 18 months out from these analyst price targets. And some of them are very high. We've got a couple of recent ones that have the stock moving to well over $1,000, but most of them are in that $5 to $600 range of price targets, which is very close to where the stock is trading right now. Yes, that is some upside, but it's not that explosive growth upside that it sounds like you are talking about. So, what do you think about that? That kind of mixed reviews of what kind of a price target AMD should have, what this company will be worth, you know, 12 to 18 months down the road. You know, the analyst trends are bullish, definitely leading to the high end of the range, but they have, you know, kind of paused over the last month or two in a wait and see posture, waiting to see what really will happen. We have all these expectations for what's going to happen with Helios in the next couple of months, but at this point, we need to see if it actually does happen. If it does happen, I think that we'll see analysts really start piling in and reaffirming that high-end target. You know, as you mentioned, the consensus is offering about 10% upside right now. That's not very much, but the high-end target is more than double that. So, in this regard, AMD starts providing some good results. We invigorate the analysts to affirm that high-end target. AMD's upside is already looking at about 100% 125%. If we assume that the company outperforms the way Nvidia has been doing, which is highly likely, sustains outperformance for several quarters, continues to raise guidance, which is what looks to be pretty likely over the next few quarters, that high is going to continue to rise and move higher. I see AMD's upside right now being virtually unlimited just because we don't really know how big the sales opportunity is. We think it is as vast as I mean it's as big as it could possibly be but we need to see the proof. There is some proofs it is derised to a degree but again we need to start seeing products delivered revenue actually coming into the company and and being reported and that revenue turning into profits. Hearing you say this, Thomas, I love to hear that you have still bullish that you have still had this very positive outlook on AMD and you've been that way really since uh April of 2025. You know, right after we had the tariff situation and we had the whole market going down so much. AMD was one of the the stocks to get hit the worst and everyone was calling it a falling knife, saying don't buy this stock and it just continued to go down and down and down. There were lots of names about that that that was the stock that was destroying people's portfolios and that was true. I mean there were people who were absolutely m losing a lot of money on AMD at that time. You came out on the the show with a very bullish outlook and if you had bought at that time you know the the stock was trading around $80 when we were talking about it. It is now almost a $500 stock just a little over a year later. Could AMD grow enough to be one of the magnificent seven someday? That could be hard to predict, too. But there are lots of stocks that have that potential with some new product launches. And of course, many of these are part of that AI story. We have a new special report out on the seven stocks that could be magnificent by the end of this year that have the potential to join that mag seven status of these massive companies that are having a huge marketwide impact. So, if you want to check out that special report and check out the seven names that are on that list and see if AMD might be one of them, scan the QR code or click the link in the description to get that report for free right now on marketbeat.com. These special reports are highly detailed. It's not just a short article. There is a lot to dive into here and a really good analysis on the seven names in this report. So, make sure to get that today. All right, Thomas, let's get into the first company that you have that is going to benefit right alongside AMD as AMD grows. These four companies are also going to see a lot of success because they are a part of this new product launch story. What's the first company you're looking at? >> Uh the first company is Broadcom. Uh Broadcom is important for scaleup switches. Scaleup switches help uh individual GPUs connect together and servers and servers connect together and into racks which is what the whole story is about. AMD has had GPUs available for a long time, all very capable GPUs, but without the rack scale capability, which includes these switches, um, unable to to really deliver product at scale. Uh, so in that regard, it was just really more of a niche player. This is a critical component in unleashing its rack scale capability and part of why it's getting such demand from the hypers scale community. >> Yeah, Broadcom is a company that a lot of people have been following for a lot of years. I know it made Nancy Pelosy's list a few years ago, so it's already seen a lot of growth. How much of an impact on Broadcom could this new AMD product launch have? >> I think it would be, you know, equal to what I've been saying for AMD, but relative to the the company's business, um AMD is looking for uh at a really significant surge in revenue driven by this this product launch. Uh so, Broadcom is well positioned to benefit. And when you think about what it is that it's doing uh without these products, uh the the GPUs are just individual components. The switches are critical for the Ethernet fabric which allows the GPUs to function uh together and cohesively as one supercomput when they're operating uh the queries and and and the training and the inference does not run in a single line. It branches out and comes back together again. And that's really what uh the Ethernet fabric helps the GPUs do and do it efficiently. Are there other companies that operate in a similar space to Broadcom that could also benefit or is Broadcom have a unique partnership with AMD? >> Broadcom has a unique partnership because Broadcom has been deeply entrenched since the design phase also working with Hullet Packard Enterprises which is another stock on the list. >> All right, let's talk a little bit more about uh Broadcom stock performance before we move on to HP. But looking at the chart for Broadcom, this one uh is up. It's up about 25% for the year, but it has a had a lot of volatility this year. It's down significantly from a a peak that it hit just a few months ago. What's behind some of the price action we're seeing here? And could this AMD launch help to to level that out? >> Well, this is a market that's growing and being lifted by an improving forward sentiment. You know, within that, there were peaks and troughs as the market gets ahead of itself and and pulls back. What I've seen in 2026 is the market did pull back, hit that bottom in April, and rebounded to a fresh high. We're struggling with a little bit of resistance right now, but we've reestablished support at a higher level than it was in the spring and we're setting up for the next run, which I I think will be unleashed by by AMD's launch. >> All right, let's move on to that second stock on the list and get a little more detail on how they're connected too. >> Right, that's Huelet Packard Enterprises. Uh they're important for connectivity having worked with Broadcom and AMD and that aspect and the Ethernet fabric, but their role is really more important than that. They are really going to be uh the original equipment manufacturer for the Helios scales. You know AMD is providing the GPUs and the architecture and has developed the ecosystem but they're not capable of manufacturing racks and HLET Packard is. It's got a a global international uh manufacturing footprint is able to do this at scale. Uh so they're going to be the one that's actually manufacturing the racks and and delivering them to the the end users. >> And the stock has had a really interesting year. Looking at the chart here, it's up 160% uh in one year. Incredibly strong performance and incredibly strong growth. And it's still even after all of that growth trading behind analyst consensus price target for where this stock should be priced at. Let's talk about what's behind that growth. Is it all AMD? Uh is it really the whole AI story? Why are we seeing such tremendous growth just in the last year for HPE? >> Well, it's the AI story, but it's really been amplified by AMD. Uh the opportunity here is enormous. You can see this in the price action. The original runup this year spiked at almost $65 and pulled back. Uh since then it consolidated, formed what looks like a bullish flag and it's broken out of it. So right now we're still struggling with that resistance point near the all-time high. But to me it looks like this market is setting up to run higher. I think that we could be to $80 by the end of the year. Again, it just comes down to the the uh successful launch of these products, the successful delivery, and the recognition of of these backlogs that we see uh being converted into revenue into earnings. >> Yeah, I I want to talk a little bit about earnings for HPE because that has been really impressive and that's when we saw the stock really peaking because I think a lot of the market was reacting to how strong those earnings were. >> Well, right, the earnings growth is is really robust and that's what's part of driving the analyst sentiment. Right now they're forecasting a hyper growth pace for the next 2 to 3 years and I think that they're still behind the curve. I think that the consensus is a little bit low uh based on what I see happening with AMD's launch and the capacity the opportunity to meet demand based on on the way the market looks right now. >> Yeah, so many positives for this one and it's an interesting ticker. We have not covered too much on this channel. I want to add this one to my Bridget Spies watch list. HPE is going on the list today. I haven't added a new stock to the watch list in a while, so I'm excited to add another name there. If you're curious what Bridget Spy is, this is a paper trading watch list right on our website. I try to add a stock from every video we talk about to kind of follow how the stock moves over time. And this is one of those names I really want to stick with and and keep up with to see what kind of moves we can see here. You can scan the QR code or just go to marketbeat.com/bid to check out that watch list for yourself and see all of the other names on the list since we talked about them on the show. All right, Thomas, let's move on to that third company that you are looking at that could also benefit from AMD's new product launch. >> Right. This is a Steroid Labs. Um, also critical to connectivity. Uh, not so much for the Ethernet fabric but for connecting uh GPUs and clusters together. Uh, very important for optics. Um, but also I want to bring up a point very important for the UA link consortium. uh UA link is a consortium that's uh was founded by AMD, Broadcom, HPE, Anastereabs among some other businesses to promote an open source open standard for AI infrastructure. And so that's part of the story too. These companies are all all working together to enable this open- source infrastructure to where um you know end users may not be necessarily locked into a certain vendor's product where they'll be able to pick and choose and have and have some choice in how they build and outfit their data centers. >> Right? We've heard about Asterolabs on the the show before, but again, there's so many different elements of this AI story and and connecting all of these things together. What exactly does Asterolabs actually do? >> Right. So, Asterabs is important for scale out and scale up. Scale up is connecting more GPUs together to form larger servers and form servers and into racks. Scale out is connecting racks and and rooms of racks together to make the larger supercomputers. It does that by um aiding signal integrity and signal speeds through the data signal through the optic cables. Uh and the primary product there are signal rettimers that just help to uh to speed up and improve signal integrity to make sure that we have the data getting where it needs to go as quickly as it needs to be there. >> So an important role in the AI story and I think that's why this name continues to pop up on several different lists on this show because it is a key company. Let's look at that chart a little bit though. We've seen that that peak just like you talked about leading into June, July and now we've also seen the volatility in this name. Has anything fundamentally changed or is that all just a reaction to what was kind of happening in the broader market? >> Yeah, I think that's still part of the the general AI peak and trough that we saw over the summer. It's part of the the anticipation and buildup to the MI450 launch. What I see right now is the market testing for support, but support seems, you know, pretty firm in the 280 region. Um, alongside that, we've got a wicked strong MACD convergent with the latest high. Uh, which tells me that those latest highs are going to be retested at least and probably exceeded based on the outlook for AMD product launch product sales. I think that, um, fresh highs are are pretty likely. >> Yeah, another one. It feels like we're saying this with almost every one of these stocks, but it's another one where the analyst price targets are absolutely all over the place. And so it confirms that story you said earlier of analysts really trying to wait and see how this AMD product launch kind of shakes out because we got price targets below 300 for this one and we have price targets all the way up to 500 which would be really nice upside for this company. So again, it's one of those huge ranges of estimates of what will be the value of this company. >> Well, right, you've got analysts like me that see the opportunity and aren't afraid to to say it. You have others that are are more cautious and waiting to see what happens. But I think those guys will be playing catch-up here pretty soon and helping to invigorate the market. >> You are clearly very bullish on AMD's story and also the whole AI story. I know that there's a lot of people who have caution right now of are we in that AI bubble? Could there could there be a bust coming soon for some of the massive growth we've seen in so many of these names. But you are one of those analysts who is very bullish on that longer term outlook for continued growth for these stocks. And some of them again continued growth. So much so that we could have much more than just the the mag seven happening soon. We could have quite a few stocks that are reaching that status of hyperscaler status. Stocks that are so massive they move the market in major ways. So if you want to check out that report on the next seven stocks that could be magnificent by the end of this year, scan the QR code or click the link in the description. Again, this is a really detailed report on the seven stocks that have that explosive growth potential that could really help move their companies from those middle players to really those mega cap massive companies because of the value they are adding in the market. Don't miss that report. Click that link in the description today. All right, Thomas, let's get on to that fourth stock that you are looking at that could benefit from AMD's product launch this year. >> Uh that's Core Scientific. Corn Scientific is uh not exactly a neocloud but it's kind of operating in that arena. It's building and operating the data centers that can house GPUs and GPU clusters. It's already uh committed to 2.5 gawatts of capacity uh centered on Helios rack scale capacity. Uh and that's going to start getting launched this year. Um it's just an example of what's going to happen I think in the entire hypers scale community. Uh but in this regard, it's one of the most visible places for investors to go and get exposure to uh to Helio's capacity uh because it's got the buildings in place. It's just waiting for the GPUs to be delivered and there are plenty of clients lined up waiting to to get the GPUs and start building their computers. >> I feel like there could be a lot of different companies that also kind of fit in this similar sector. Is Core Scientific kind of unique or are there other names that could fit into this category of benefiting from AMD? Um, I don't think that it's so unique. It's just really well positioned. Um, it is amongst a handful, a growing handful of companies that you could call hyperscalers or neoclouds, but including Core Scientific, you've got Microsoft, Meta, Oracle, OpenAI, and Anthropic, all committing to multiple gigawatts of capacity. Right now, it looks like they've got at least 12.5 gawatts of capacity, which is which is working on like $225 billion in future revenue. Uh this is not including uh you know, Google or Amazon or any of the other hyperscalers. Uh so we're really looking at a large revenue opportunity. It's it's in place. It's just waiting for the products to be available. Uh you know, if you need to buy one, AMB is going to have it for you. You need a place to put it, Core Scientific's got it for you. You need to connect them together. these other companies have what you need to make it happen. >> One thing that is different from the other three stocks on this list is the Core Scientific is still that early pre-revenue company. The other companies have uh a lot of earnings coming in. They're doing very very well in the earnings department and this one is doing a lot of spending right now. So, let's talk about those differences with Core Scientific. >> That's going to be a heaven for the stock price. You know, any any delays will certainly be reflected in the price action. But again, this isn't um you know, a high-risisk startup where we're trying to establish a market. This is a business that's growing into an established market. And right now, it's really just waiting for the GPU capacity to be there. And it's it's coming down the pipe. >> Let's talk about that pipeline, though, and and what kind of timeline we could be looking at for this to turn to profitability, for this massive investment into building this to really pay off. Is it a threeyear, fiveyear timeline? Is it sooner than that? or is it more like a decade to see that investment really pay off and turn into a lot of profit for this company? >> Well, there's really two catalysts involved here. Uh the inflection to profits will probably happen really soon, maybe next year. Uh once capacity comes online, they'll start making money immediately. But the real opportunity is long-term. Uh because this is infrastructure that you build and put in place has a long lifespan. You'll be able to generate cash from this business for years into the future. And as you pay off the initial cost, those the cash flow, the free cash flow and the earnings will continue to grow over time. Uh that's really that's kind of why Nvidia was able to to securitize its GPU capacity, make that deal that it did with the Black Rockck and and the big the big money managers because [snorts] they they view this as cash generating infrastructure and that's what cord scientific enables. It enables uh businesses to establish cash generating GPU infrastructure and develop solid cash flows that will sustain for years. >> All right, really interesting conversation today, Thomas. I know we talked about just four stocks, but there are plenty that are also going to benefit from AMD's new product launch, and we covered one of them just a couple of days ago. If you haven't watched this interview yet, this is a a recent IPO that's connected to the AI story. Can absolutely benefit from this AMD launch as well. This is a deep dive into just one stock and why Thomas is also very bullish on this.