Analysts at Mizuho raised their price targets for Micron Technology (NASDAQ:MU), Qualcomm (NASDAQ:QCOM), Seagate Technology (NASDAQ:STX) and Western Digital (NASDAQ:WDC) in a note on Friday, stating that they believe the next driver for artificial intelligence will be at the edge.
This is as OEMs start to push AI on-device capabilities for both handsets and PCs. Mizuho reiterated its Buy ratings on the companies while raising the price targets to $240, $155, $90, and $110, respectively.
The analysts noted that QCOM is ramping up AI PCs with Snapdragon X Elite and Plus.
It is said to be launching 20 or more models in the second half of this year. It is also ramping on handsets with Snapdragon 8 Gen 3, while it has already launched with Samsung S24 Ultra. Mizuho noted potential further wins at VOX.
Furthermore, AI PCs requiring 40% to 80% higher DRAM content and handsets needing 50% to 100% more DRAM is seen as a tailwind for MU. In addition, WDC and MU are expected to see tailwinds from higher NAND content in AI devices with better pricing.
STX is considered better with higher storage content on PCs and improving cloud capex. Mizuho also sees the potential for 1 billion AI smartphones shipped from 2024 to 2027. AI PCs are expected to make up as much as 60% of the PC market by the end of 2027.