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There’s an old Wall Street ritual that happens near the end of every quarter.
It’s called “window dressing.”
This is when professional money managers start making their portfolios look a little prettier.
Fund managers know their clients are about to see what they own. And naturally, they would rather show off stocks with strong performance and great fundamentals than explain why they’re still hanging on to laggards.
Well, folks, we’re heading into the final days of September. And I think we’re already starting to see some bargain hunting in the kinds of fundamentally superior stocks that institutions may want to own as the third quarter draws to a close.
In fact, two artificial intelligence infrastructure stocks I follow closely have started to wake up.
One recently delivered a 22.1% earnings surprise, with sales forecast to rise 30.1% and earnings expected to surge 128.4%.
The other is expected to grow sales 45.3% and earnings 68.9%, while also benefiting from strong institutional buying pressure.
Neither one of these stocks is a household name. But both sit right in the middle of an interesting debate about the future of AI infrastructure.
So, in this week’s Navellier Market Buzz, I explain why these two stocks are starting to wake up, what quarter-end window dressing could mean for them – and why I think both could be winners in the AI boom.
I also explain how I use Stock Grader when a holding starts to weaken and address what the Fed’s latest rate hike means for some of my favorite AI infrastructure plays.
Click here or the image below to watch this week’s Navellier Market Buzz.
The two stocks I highlighted in the video help move massive amounts of data through data centers. Some investors have started treating those technologies like competitors, especially with all the talk about eventually putting data centers in space.
I think that misses the bigger picture.
Both technologies move data at the speed of light. And as AI creates exponentially more data that needs to move between chips, servers, data centers and, eventually, satellites, I believe both companies can be winners.
The fundamentals back that up. They’re expected to report sales increases of 30.1% and 45.3%, respectively. Earnings are expected to surge 128.4% and 68.9%, respectively.
That’s exactly what I want to see. But these two stocks also point to something much bigger.
AI Without the “Kill Us All” Problem?
Last week, we spent some time talking about former Anthropic researcher Jacob Coxon.
Coxon quit the company and warned that AI developers were “racing straight to self-improving superintelligence and gambling with our lives.” His post went viral, major AI leaders weighed in and Wall Street briefly punished many of the stocks powering the AI boom.
I mentioned that there are legitimate AI-safety issues worth taking seriously. But I also said investors should not confuse those risks with the end of the AI boom.
In fact, my research team and I have been studying a massive new AI initiative taking shape across America’s national laboratories.
The goal is to build a massive AI computing network designed specifically for scientific discovery.
That’s important because this is not the kind of artificial superintelligence the naysayers are worried about. They’re worried about a kind of general-purpose system capable of improving itself across virtually every field of human knowledge.
But Golden Dawn is being designed for something much more targeted.
It would use enormous amounts of computing power and specialized AI agents to attack specific scientific problems in fields such as energy, medicine, advanced materials and quantum computing.
The idea is to capture the extraordinary problem-solving power AI could eventually deliver while keeping it focused on defined scientific missions.
And the scale behind this project is staggering.
The resulting network could become what I call the world’s first AI Mega Computer, connecting enormous amounts of computing power across the country.
That means work that once took 10 years could potentially happen in about 10 days.
Some of the biggest names in tech are connected to this project, including Sam Altman, Jensen Huang and Jeff Bezos. My team has spent months tracing the contracts, infrastructure and companies involved.
And that trail led us to one off-the-radar AI stock I believe could be positioned to benefit directly.
Go here to get the full story now.
Sincerely,
Louis Navellier
Editor, Market 360
