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The year 2024 was the best proof yet that Artificial Intelligence is not a passing trend on Wall Street.
AI was on everyone’s lips for the second year in a row. Number of companies that mention “AI” The number of earnings calls has continued to increase after reaching a record high last year. Investors continued to buy shares in companies which are benefiting or will soon be benefiting from AI: Three of the top five performing stocks on the Russell 1000 can attribute their explosive rise to AI.
Applovin, a software company (APP), reported that advertising revenues grew by 66% during the latest quarter. This was due to improvements in its artificial intelligence model “through ongoing self-learning and directed model enhancements.” Applovin’s profit more than tripled in the same period. After the results were announced, the shares rose by almost 50%. This contributed to a stock rise of more than 740% this year.
Palantir Technologies’ (PLTR), stock soared this year, as the company flexed it AI muscles. Palantir executives discussed how their AI platform is helping customers save time and achieve better results. Sales rose by 30% for the company in its most recent quarter. Both commercial and government business grew at double-digit rates. Palantir’s shares are expected to increase by 360% between 2024 and 2024.
Vistra (VST) was the second-best performing stock in the S&P 500 in 2024 as investors learned that its generally sleepy, slow-growing sector—utlities—could have its businesses turbocharged by AI. Vistra’s shares are up about 260% in the past year, as analysts began to identify the company as an AI beneficiary.
Nuclear plants are vital for data centres, and companies such as Microsoft see them as a necessity. Constellation Energy Group and Microsoft signed a contract in September to reopen a portion of Pennsylvania’s Three Mile Island. Constellation Energy Group shares are up more than 90% in the past year.
GE Vernova (GEV), which has had a strong year, was also helped by the electrification of data centers. In December, the company raised its sales forecast for long-term due to demand from gas turbines as well as electrical grid equipment. Stocks have risen more than 130% in value since General Electric was split into three different companies.
Nvidia’s (NVDA) shares are the poster children of the AI rally. They have gained roughly 180% in the past year. In 2023, their value nearly tripled. Nvidia CEO Jensen Huang called the demand for Nvidia chips “unprecedented”. “insane,” A company’s record quarterly revenue and profit confirms this assessment.
Nvidia’s stock isn’t the only one that has seen a big boost in value from AI. Broadcom shares (AVGO), which are a component of Broadcom, have risen by more than 110 percent this year due to the surge in demand for custom chips. Broadcom was the only U.S. firm to surpass $1 trillion in market cap after beating quarterly earnings expectations and announcing that it worked with three large tech companies on customized AI infrastructure.
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