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AI has been Wall Street's obsession for quite some time now, with investors excited about how the game-changing tech is set to transform our world in many ways, from reshaping business models and driving productivity gains to creating entirely new markets and industries. Elevate Your Investing Strategy: Take advantage of TipRanks Premium at 50% off! Unlock powerful investing tools, advanced data, and expert analyst insights to help you invest with confidence. The technology is widely seen as one of the most transformative forces of our era – yet, according to investing legend Ken Griffin, the most meaningful chapters are still unwritten. 'Generative AI has just gripped the world both in mind-share impact and to some degree hype… Generative AI is just another step in the journey of the use of machine learning technologies by modern society… I think the really interesting generative AI stories are going to be when people think about how to use these tools in radically different ways than we currently use software, and those will be many of the game-changing businesses of the next 10 to 20 years. So it's going to be incredibly exciting,' Griffin opined. Griffin is backing up his words with action. With a net worth north of $47 billion, the founder and CEO of Citadel – one of the world's most profitable hedge funds, managing $68 billion in capital – has been leaning heavily into the AI opportunity. Citadel's portfolio boasts some of the most prominent AI stocks out there, including Nvidia (NASDAQ:NVDA) and Advanced Micro Devices (NASDAQ:AMD). However, during Q2, Griffin loaded up on one of these yet trimmed his holdings of the other. So, we've decided to take a closer look at the pair to see why Griffin has more conviction in one of these names right now, and with a little help from the TipRanks database, we can also find out if the Street's analyst community is thinking along the same lines. Nvidia What better place to start than at the altar of the mightiest AI stock of them all? The current bull market might be an AI-driven one, but you might as well call it the Nvidia bull market. That's because AI's rise has coincided with Nvidia's march to the top of the market cap charts, with the firm transforming from merely a semiconductor giant to becoming the world's most valuable company. That transformation has been powered by one critical fact: Nvidia makes the best AI chips on the market – the ones driving the data centers that fuel this technological revolution. Under Jensen Huang's leadership, the company now commands more than an 80% share of this space, leaving rivals scrambling to keep pace. It's a remarkable shift for a firm that, not long ago, was better known for supplying GPUs to gamers. Wall Street first took notice when its data center segment exploded into Nvidia's primary growth engine, and the company has since built a track record of delivering blockbuster quarterly results. Even trade restrictions and China-related headwinds haven't derailed its momentum, as demonstrated in its last reported fiscal Q1 quarter. (April quarter). Revenue surged to $44.06 billion, up 69.2% year-over-year and ahead of consensus by $810 million. Data Center revenue accounted for $39.1 billion of that total, a 73% annual jump. Earnings strength followed suit, with adjusted EPS of $0.81 beating forecasts by $0.06. With all of that on offer, Ken Griffin has signaled that he wants in. During Q2, he upped his NVDA stake by 414%, purchasing 6,513,348 shares. These are currently worth a whopping ~$1.175 billion. According to Piper Sandler's Harsh Kumar, an analyst ranked in 13th spot amongst the thousands of Wall Street stock experts, that investment is going to pay off nicely. Looking ahead to the upcoming July quarter readout (slated for August 27), Kumar thinks another strong display is coming. 'We are expecting another positive quarter from NVDA and see upside to numbers for both the July and October quarters,' the 5-star analyst said. 'While we are modeling largely in-line for the July quarter and slightly below Street for October, we are calling for upside given the recent positive commentary from U.S. hyperscalers as well as the inclusion of revenues from China. We note that our estimates and Street estimates do not reflect the inclusion of China business as we are anticipating revenues to start coming in towards the end of this month. China demand in our view could amount to ~$6B in sales for the October quarter and further ramp from there at a ~12-15% growth rate moving forward in a normal quarter. Finally, we are encouraged by hyperscaler commentary around capex plans for 2H and 2026 which should continue to pressure NVDA to meet this demand.' Quantifying his bullish stance, Kumar rates NVDA shares as Overweight (i.e., Buy) while his $225 price target factors in a one-year gain of 25%. (To watch Kumar's track record, click here) The majority of Kumar's colleagues support that stance; NVDA claims a Strong Buy consensus rating, based on a mix of 35 Buys, 2 Holds and 1 Sell. (See NVDA stock forecast) AMD There is really no better stock to delve into next than AMD, a statement that is something of both a compliment and a curse. A compliment because AMD is seen as possibly the only other semi name out there that can challenge Nvidia's dominance in the AI chip world. Moreover, AMD has already proven itself adept at eroding another rival's rule over a particular segment. Intel used to be the undisputed leader of the CPU space, but by making the most of Intel's mistakes and offering better products, AMD has been steadily closing the gap on the fallen chip giant's leading position in that sector. But the very fact that AMD is measured against Nvidia is what makes the comparison something of a curse. Despite its achievements, AMD has often been saddled with 'little bro' status. The perception persists that AMD is simply second-best in the AI chip game, lacking the complete ecosystem that Nvidia offers, and forced to play catch-up in a market it entered much later. And unlike struggling Intel, Nvidia isn't a weakened rival – it's still firing on all cylinders, making the bar for AMD that much higher. Even so, it's important not to overlook AMD's own impressive trajectory. While Nvidia may have stolen the spotlight, AMD has continued to deliver solid results and carve out its share of wins. The company's recent Q2 readout underscored that point. Revenue climbed by 31.7% year-over-year, reaching $7.69 billion and outpacing analyst expectations by $260 million. At the bottom line, adjusted EPS of $0.48 landed in line with consensus estimates. Looking ahead, AMD projects Q3 revenue of $8.7 billion, plus or minus $300 million, well above the Street's forecast of $8.32 billion. In fact, this outlook didn't even factor in revenue from shipments to China, which had been banned at the time but are now allowed again. The market has taken notice. AMD shares have surged 127% since April's tariff-driven lows, a rally that may explain why Griffin has been trimming his stake. In Q2, the billionaire sold 2,433,332 AMD shares, cutting 67% of his holdings. That kind of caution is mirrored in recent comments made by Morgan Stanley analyst Joseph Moore, who wrote: 'AMD revenue continues to be quite strong, but it's not clear that will be enough to keep the bulls in charge of the narrative. AMD guided well above consensus for Q3, but there are a few factors of note here that make the topline strength less appealing: (1) Console gaming upside drove the beat in Q2, arguably the lowest quality portion of AMD's business, (2) datacenter GPU will be up y/y in Q3, implying 1.6bn+ by our estimates; combined with company commentary for strong server and growth in embedded and client, we don't think it's likely to be more than 100- 200mn more than that…(3) Opex coming in above estimates limits impact on EPS.' To this end, the 5-star analyst rates AMD an Equal-Weight (i.e., Neutral) while his $168 price target implies shares will slide by 5% over the coming months. (To watch Moore's track record, click here) To find good ideas for AI stocks trading at attractive valuations, visit TipRanks' Best Stocks to Buy, a tool that unites all of TipRanks' equity insights.
