With artificial intelligence stocks leaving behind the rest of the market after Nvidia’s blockbuster earnings report, it’s little surprise that three AI stocks top this weekend’s watch list. Data-center gear supplier Arista Networks (ANET), autonomous driving technology leader Mobileye (MBLY) and chipmaker Monolithic Power Systems (MPWR) all surged close to buy points last week. ANET, MBLY and MPWR are joined by drug wholesaler McKesson (MCK) and Smartsheet (SMAR), whose work management software facilitates collaboration in the workplace.
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Mobileye and Smartsheet are both part of the flagship IBD 50 list of leading growth stocks. Monolithic Power is on the watch list for the IBD Long Term Leaders list.
Mobileye Stock
On Thursday, Wells Fargo started coverage of MBLY stock with an overweight rating and 50 price target. Analyst Aaron Rakers sees Mobileye becoming a “platform enabler” for autonomous vehicles. SuperVision revenue should grow to $3.2 billion over the next five years, but could reach $7 billion in an upside scenario.
On May 9, Porsche, which is part of Volkswagen, said it will offer automated driver assistance using SuperVision. Mobileye said with its April 27 Q1 earnings report that a global U.S.-based automaker is expected to adopt SuperVision in the second half of 2023.
MBLY stock roared back over the past week, surging 10.6% to 45.14, recovering after a dive on Q1 earnings. Mobileye has an official 48.21 buy point from a 14-week consolidation, according to a MarketSmith analysis. A move to 47.04, which doesn’t quite qualify as a double-bottom-base buy point, could offer an early entry. If MBLY consolidates here over the coming week, 46.58 — 10 cents above Friday’s intraday high — might provide an earlier entry.
Arista Networks
Like Mobileye, ANET stock surged back in recent days following a Q1 earnings selloff. Bank of America Global Research added Arista to its “US 1 list” of best investment ideas on Wednesday. But shares really took off with other AI plays on blowout guidance from Nvidia (NVDA) on Wednesday night.
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