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Every quarter, Wall Street looks closely at NVIDIA Corporation’s (NVDA) latest results for clues about where the artificial intelligence boom may be headed next.
And on the latest earnings call, the company revealed something that caught my attention.
Higher memory costs are reportedly forcing NVIDIA to raise prices to customers by nearly 15%. And the company’s sales outlook could have been even stronger if more memory were available.
And this may not be a short-term problem. Micron Technology, Inc. (MU) CEO Sanjay Mehrotra expects tight memory supplies to persist beyond 2027.
Normally, a shortage sounds like bad news. But as an investor, I see something else: opportunity. When demand is this strong and supply can’t keep up, I want to know which companies could benefit.
That’s especially true considering some of the volatility we’ve seen in some AI stocks lately.
As regular Market 360 readers know, several high-flying AI names were hit hard this summer as the highly leveraged Situational Awareness hedge fund was forced to unwind positions. That selling pressure had little to do with whether those businesses were suddenly becoming less important to the AI buildout.
It was forced selling.
And that raises an important question: Once you look past all that volatility, where is the big institutional money actually going?
That’s why I invited Lucas Downey, co-founder of MoneyFlows, onto this week’s Navellier Market Buzz.
Lucas tracks where big institutional investors are putting their money. And right now, he’s seeing strong buying pressure in some of the companies that could benefit from this memory shortage.
But that’s not all we discussed.
We also looked at other corners of the AI market attracting big money – including one that Lucas believes many investors still don’t fully appreciate.
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The AI Trade Is Broadening Out
Memory isn’t the only place we’re seeing new opportunities emerge.
As Lucas explained, money is also flowing into companies that make the equipment needed to produce advanced chips, as well as the optical technology needed to move huge amounts of data through AI data centers.
He highlighted semiconductor-equipment leaders such as Lam Research Corp. (LRCX) – and he also pointed to growing interest in the photonics space, where companies like Corning Inc. (GLW) help move ever-larger amounts of data at high speeds.
That matters because Lucas is seeing something bigger than a rally in a few individual stocks.
His broader money-flow indicators suggest capital isn’t simply fleeing the market when AI stocks pull back. Instead, it’s being reshuffled into different industries and different parts of the AI supply chain.
That gets to a bigger point about this AI boom: The opportunity is much bigger than NVIDIA.
The more money companies spend on AI, the more technology they need to make it all work.
They need memory. They need advanced chipmaking equipment. They need faster networking. They need enormous amounts of power and new data-center infrastructure.
That means investors who focus only on the biggest AI names could miss some of the companies benefiting behind the scenes.
And as this buildout moves into its next phase, I expect a new group of companies to capture an increasing share of the trillions of dollars flowing into AI.
My team and I have been digging deeper into this next stage of the AI boom, and we’ve identified one company I believe is especially well-positioned for what comes next.
I put together a special presentation to explain why. The opportunity is tied to a major AI project underway from Elon Musk – but the company I’m recommending isn’t Tesla, Inc. (TSLA) or Space Exploration Technologies Corp. (SPCX).
In the presentation, I’ll give you the company’s name and ticker symbol and explain why I believe it could be such an important part of what comes next.
Sincerely,
Louis Navellier
Editor, Market 360
The Editor hereby discloses that as of the date of this email, the Editor, directly or indirectly, owns the following securities that are the subject of the commentary, analysis, opinions, advice, or recommendations in, or which are otherwise mentioned in, the essay set forth below:
Micron Technology, Inc. (MU) and NVIDIA Corporation (NVDA)
