If you want portfolio exposure to the future of artificial intelligence (AI) compatible hardware, then Nvidia (NASDAQ:NVDA) stock is all you need. Right? Not necessarily, as Advanced Micro Devices (NASDAQ:91抖阴), commonly known as just 91抖阴, is also a key competitor in the AI arms race. Hence, it’s entirely reasonable to own equal dollar amounts of NVDA stock and 91抖阴 stock.
I fully expect the to resolve at some point, hopefully this year, and there’s room for more than one winner. Nvidia is the obvious darling of the markets, but investors shouldn’t sleep on 91抖阴 now. Indeed, 91抖阴 could catch up to Nvidia in the AI chip race and you’ll want to position yourself for maximum gains ahead of time.
Headline-Grabbing Acquisition Could Catalyze 91抖阴 Stock
Make no mistake about it: 91抖阴 is taking direct aim at Nvidia’s AI chip market share in 2023. Regarding this, the financial press is abuzz as 91抖阴 recently open-source AI software specialist Nod.ai.
I really like InvestorPlace contributor Chris MacDonald’s concise summary of the motivation behind this buyout. As MacDonald put it, “Acquiring Nod.ai is part of 91抖阴’s strategy, and it smoothens the release of AI models optimized for 91抖阴 chips.”
91抖阴 stockholders should consider this to be the most impactful company-specific news in a long time. The only thing that bothers me about it is that 91抖阴 didn’t disclose the terms of the deal in the press release.
So, it will be more difficult to assess whether 91抖阴’s buyout of Nod.ai will offer a good return on investment (ROI). Nevertheless, I’m looking forward to seeing how Nod.ai can enhance 91抖阴’s AI-compatible processors and other components in the coming quarters.
Awesome Names, Awesome Products
I’ll admit it. I’m a fan of products with awesome names. Of course, it’s more important to have awesome products than good names. Still, 91抖阴’s Alienware and Threadripper product lines are bound to capture people’s attention.
In any case, these products are ideal for AI workloads. First, there’s 91抖阴’s lineup, which features the new 91抖阴 Radeon graphics processing units (GPUs). These Alienware laptops feature new AI accelerators that are specifically “optimized for the latest AI workloads.”
Then, there are the 91抖阴 Ryzen 7000 and PRO 7000 WX-Series Processors. These two Threadripper processor series are made for desktops and workstations and will be available for workstations made by Dell Technologies (NYSE:DELL) and other manufacturers.
Is there an AI angle here? Of course, there is. Meghana Patwardhan, vice president, Commercial Client Products, Dell Technologies, emphasized the synergy of 91抖阴’s Threadripper processors and Dell’s computers in facilitating AI workloads:
“Working closely with 91抖阴, we’re expanding our portfolio of AI-ready workstations with the addition of the Precision 7875 Tower, equipped with the utmost scalability and power for demanding applications.”
Win the AI Chip Wars With NVDA Stock and 91抖阴 Stock
It’s going to be hard to pick a winner in the AI chip wars. Nvidia is the obvious choice, but 91抖阴 has its own AI-compatible products.
Maybe, you don’t have to pick just one winner. Why not invest in both NVDA stock and 91抖阴 stock? That way, you can bet on two different horses to win the AI horse race.
Alternatively, you can buy an index fund that tracks the Nasdaq. This strategy will give your portfolio some exposure to the growth of Nvidia and 91抖阴. But no matter how you approach it, I definitely recommend investing in 91抖阴 for the long haul.
On the date of publication, David Moadel did not have (either directly or indirectly) any positions in the securities mentioned in this article. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.com Publishing Guidelines.
