Citi has identified several undervalued global stocks exposed to artificial intelligence that present substantial investment opportunities. The Wall Street bank said these stocks have seen improved earnings expectations but have not experienced significant increases in their valuations, making them attractive for investors looking to capitalize on the AI trend without paying premium prices. This year, the global equity market has received a substantial boost from AI-related stocks.
While many AI stocks have benefited from both expanding multiples and upward earnings revisions, Citi has identified a subset of 19 stocks that buck this trend. The bank says these stocks largely have "medium" exposure to AI. The investment bank's analysts hiked their 2024 earnings estimates for these stocks, but they have not yet experienced significant price-to-earnings expansion.