Why this ‘Mag 7’ stock is still a buy even though it’s behind on AI

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Why this ‘Mag 7’ stock is still a buy even though it’s behind on AI

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may be lagging behind its peers on the artificial intelligence front, but the name is still investor Ray Wang’s favorite among the ” Magnificent Seven ” cohort of mega-cap tech titans. As a catalyst, the principal analyst and founder of Constellation Research pointed to

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’s advertising revenue, which he said is still growing at a 20% annual rate. This growth is quickly allowing the company to catch up to

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’s ad revenue numbers, Wang said Monday morning on CNBC’s ” Money Movers .” What’s more, the enormous

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Web Services cloud services business effectively allows

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the leeway to figure out the best path forward in terms of applying AI to the rest of its businesses. At the same time,

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’s Prime Video platform presents a formidable opponent against

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. Wang also said

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’s Prime membership rolls could benefit from the upcoming holiday shopping season. Despite these tailwinds, Wang acknowledged a big obstacle for

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: it’s currently lagging behind its peers’ artificial intelligence capabilities. But Wang believes that

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’s late-mover position won’t ultimately harm its potential too much. “The bright side is they’re done with their big CapEx investments into their data centers, whereas

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has a lot of CapEx investment to do and

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has to play a lot of catch up. So

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has a little bit of time to get their AI story right,” he said. Wang added that investors can expect more insight into

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’s investments during its December re:Invent conference.

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#Mag #stock #buy

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