TLDR
- Nvidia selected as Wolfe Research’s top artificial intelligence investment for 2026, added to firm’s Alpha List
- Morgan Stanley increases ASML price target to €1,400, expecting 57% earnings growth in fiscal 2027
- Microsoft positioned to gain IT spending share with 92% of CIOs planning to use GenAI products
- Dell receives Barclays upgrade on $25 billion AI server shipments forecast for fiscal year
- EssilorLuxottica upgraded by HSBC as smart glasses market projected to reach $200 billion by 2040
Several major investment firms updated their positions on artificial intelligence stocks this week. The moves signal growing confidence in AI infrastructure and enterprise adoption trends.
Wolfe Research named Nvidia its top artificial intelligence stock pick for 2026. The chip manufacturer was added to the firm’s Alpha List, taking the place of Micron. Despite gaining 36% over the past year, Nvidia underperformed compared to other AI-related stocks.
Analyst Chris Caso pointed to three reasons for the lag. The delayed Blackwell launch, questions about AI spending levels, and concerns over custom AI chip competition all weighed on performance. These issues are now fading as the product roadmap advances.
The Blackwell chip is ramping up production while Rubin stays on track for a second-half 2026 release. Rubin offers five times better inference performance than Blackwell. Nvidia’s guidance points to at least $40 billion above consensus revenue estimates for calendar year 2026.
Pricing trends have improved for Blackwell Ultra and Rubin according to the analyst. Google’s TPU represents the main competition while other custom solutions have not reached comparable scale. The stock trades at 23 times estimated 2026 earnings, below its historical average.
Microsoft Dominates Enterprise AI Spending Plans
Morgan Stanley’s latest CIO survey revealed Microsoft’s strong position in capturing generative AI budgets. The survey showed software spending will grow 3.8% in 2026 versus 3.7% in 2025.
Microsoft ranks as the top gainer of IT wallet share due to cloud migration. This applies across both one-year and three-year periods. Some 92% of CIOs plan to use Microsoft’s GenAI products over the next 12 months.
Azure hosts 53% of application workloads according to surveyed CIOs. Plans for Azure OpenAI Services reached 37% while GitHub Copilot adoption is expected from 42% of respondents. Microsoft 365 Copilot will be deployed by 80% of CIOs over the next year.
Semiconductor Equipment and Hardware Stocks Rise
Morgan Stanley raised its ASML price target by 40% to €1,400 from €1,000. Analyst Lee Simpson expects fiscal 2027 sales of €46.8 billion with earnings per share around €45.7. This represents 57% year-over-year earnings growth.
The analyst projects 80 EUV tools will ship in 2027. Major customers including TSMC, Intel and Samsung are expected to drive demand. Memory capacity buildout should increase following strong pricing trends.
Barclays upgraded Dell Technologies to Overweight from Equal Weight while maintaining a $148 price target. The upgrade reflects stronger AI server order visibility and enterprise market recovery.
Dell expects to ship $9.4 billion in AI servers during the fourth quarter. Full-year AI server shipments should reach $25 billion. Barclays projects AI order growth of 155% in fiscal 2026 and 60% in fiscal 2027.
Operating margins for AI servers are running at mid-single digits. This came in better than earlier expectations despite ongoing gross margin pressure.
HSBC upgraded EssilorLuxottica to Buy with a €340 price target. The eyewear company partners with Meta on AI-powered smart glasses. HSBC raised its total addressable market estimate to $200 billion by 2040.
The firm now expects 35 million smart glasses units will ship in 2030 and 57 million in 2040. EssilorLuxottica holds roughly 70% market share with brands like Ray-Ban and Oakley. HSBC projects the company will maintain about 20% share by 2040 as competition increases.
