Grok, a chatbot made public to users in November last year, has been heralded as an AI that aims to provide unbiased and unfiltered conversations with users. But one of its other features is that it can be prompted to produce stock recommendations of stable and mature companies, which has led to this list of blue chip stock picks by Grok AI.
What I like about Grok is two things: Namely, it has access to real-time information, and it’s trained on billions of tweets from users on the platform. Since the sentiment on social media tends to be more responsive to the sentiment in the financial markets, Grok can be a powerful tool for finding investment opportunities.
So here are some blue chip stocks that investors should consider adding to their portfolios, as recommended by Grok.
Blue-Chip Stock Picks by Grok AI: Apple (AAPL)
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Apple’s (NASDAQ:AAPL) services segment continues to grow, contributing to its overall revenue. Analysts also see potential in new products like the Vision Pro mixed reality headset.
AAPL was also the first stock that Grok recommended, saying:
Apple has a strong foothold in the smartphone and computer markets, with its iPhone and Mac devices being highly popular among consumers. The company’s ability to consistently innovate and release new, cutting-edge products has helped it maintain its market share and keep competitors at bay.
With the rise of new technologies like 5G, augmented reality, and artificial intelligence, Apple is well-positioned to capitalize on these trends and continue to innovate and grow. The company’s strong brand, loyal customer base, and financial resources give it a significant advantage over competitors in these emerging markets.
Wall Street rates AAPL as a “Buy,” and there’s a 2.70% upside for its stock price over the next twelve months, which suggests it may be fairly valued.
Amazon (AMZN)
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Amazon (NASDAQ:AMZN) has implemented cost-cutting measures and crafted a generative AI strategy to position itself well for the future.
Grok said this about Amazon:
Amazon has expanded into multiple sectors, such as advertising, streaming services (Amazon Prime Video), and smart home devices (Amazon Echo). These diversified services not only generate additional revenue streams but also help the company to remain competitive and innovative.
Despite being a market leader in e-commerce, Amazon still has room to grow. The global e-commerce market is expected to expand, and Amazon is well-positioned to capitalize on this growth. The company is also investing in emerging markets, which could provide additional growth opportunities.
AMZN is rated as a “Strong buy,” and this bullish recommendation comes with a 9.52% upside for its stock price.
Tesla (TSLA)
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Tesla (NASDAQ:TSLA) is considered a leader among electric vehicle manufacturers and continues to innovate. Dips in the stock price may become attractive market entries for long-term investors.
Grok agrees, stating:
Tesla has consistently pushed the boundaries of what is possible with electric vehicles, developing new battery technologies and improving the range and performance of their cars. This commitment to innovation has helped Tesla maintain its position as a leader in the EV market, and it is likely to continue driving the company’s growth in the future.
In addition to its focus on innovation, Tesla has also made significant investments in charging infrastructure. The company has built a vast network of Supercharger stations, making it easier for Tesla owners to charge their vehicles on long trips. This investment in charging infrastructure has helped to address one of the main concerns that potential EV buyers have, and it has made Tesla’s vehicles more appealing to a wider audience.
Wall Street rates TSLA as a “Hold,” but there’s also an implied 24.84% upside for its stock price.
Nvidia (NVDA)
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With a high level of earnings growth expected, Nvidia’s (NASDAQ:NVDA) valuation appears reasonable, together with a transformative AI tailwind that continues to dominate the financial headlines.
Here are two reasons why Grok thinks NVDA is a great investment:
One of the key factors driving NVIDIA’s growth is the increasing demand for GPUs in the gaming industry. As games become more complex and visually stunning, the need for powerful GPUs to run them smoothly has grown significantly. This trend is expected to continue, providing a strong tailwind for NVIDIA’s gaming business.
Another major growth driver for NVIDIA is the rise of artificial intelligence and machine learning. The company’s GPUs are widely used in AI applications, such as deep learning and data analytics. As AI continues to grow in importance across various industries, the demand for NVIDIA’s GPUs is expected to remain robust.
NVDA is rated as a “Strong buy,” and it appears fairly valued by Wall Street.
Meta (META)
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Meta (NASDAQ:META) is expected to benefit from a favorable digital advertising market in 2024. Namely, the company’s advertising business is likely to see continued growth. This has led to some analysts upgrading their price targets for META stock.
Grok said the following about this company:
Meta (META) is a social media giant that is expanding into the metaverse, which could open up new opportunities for growth. The metaverse is a virtual space where users can interact with each other and digital objects in a seemingly real way, and it’s an area that is ripe for exploration and innovation.
By expanding into the metaverse, Meta is positioning itself to take advantage of this new frontier and potentially tap into new revenue streams. This could include things like virtual real estate, digital goods and services, and other forms of digital commerce.
The consensus on Wall Street is that META is a “Strong buy,” but there is a slight expected decrease in its stock price in the short term.
Advanced Micro Devices (AMD)
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UBS raised its price target for Advanced Micro Devices (NASDAQ:AMD) from $135 to $220 per share, believing that AMD’s GPU data center revenue will be very strong in the coming year.
Grok, too, believes that AMD should be on your watchlist, stating:
Advanced Micro Devices (AMD) is a buy because its processors and graphics cards are gaining market share, and the company is well-positioned to benefit from the growth of the gaming and data center markets. In the gaming market, AMD’s graphics cards are becoming increasingly popular due to their strong performance and competitive pricing. This has helped the company to gain market share from its main competitor, NVIDIA.
In the data center market, AMD’s processors are also gaining traction. The company’s EPYC server processors offer a compelling combination of performance and efficiency, making them an attractive option for data center operators. This has helped AMD to win business from its main competitor, Intel.
AMD is currently rated a “Strong Buy,” but it may be slightly overvalued at the current levels.
Netflix (NFLX)
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Netflix (NASDAQ:NFLX) consistently beat Wall Street’s consensus earnings per share (EPS) estimates in the first three quarters of 2023, and its share price recovered from $300 to now $562 at the time of writing.
Grok believes that there could be more in store for NFLX investors, stating:
Netflix (NFLX) is a strong buy for several reasons. Despite recent challenges, the streaming giant remains a dominant player in the entertainment industry, boasting a vast and diverse library of content that caters to a wide range of tastes and preferences. This extensive content library, coupled with its user-friendly interface and affordable subscription plans, has helped the company amass a massive subscriber base, which continues to grow.
One of the key factors that make Netflix an attractive investment is its commitment to original content. The company has been investing heavily in producing high-quality, exclusive content, such as popular series like Stranger Things, The Crown, and Squid Game, as well as critically acclaimed movies like The Irishman and Roma. This focus on original content not only helps the company differentiate itself from its competitors but also allows it to retain subscribers and attract new ones.
Wall Street also rates NFLX as a “Buy,” but in the short term, there could be a slight dip in its stock price.
On the date of publication, Matthew Farley did not have (either directly or indirectly) any positions in the securities mentioned in this article. The opinions expressed are those of the writer, subject to the InvestorPlace.com Publishing Guidelines.
Matthew started writing coverage of the financial markets during the crypto boom of 2017 and was also a team member of several fintech startups. He then started writing about Australian and U.S. equities for various publications. His work has appeared in MarketBeat, FXStreet, Cryptoslate, Seeking Alpha, and the New Scientist magazine, among others.
