Susquehanna Reiterates Hold Rating on SM Energy Company with $27 Price Target

Susquehanna analyst Biju Perincheril maintains a Hold rating on SM Energy Company (NYSE:SM) with a price target of $27.00. SM Energy reported net production of 17.8 MMBoe, exceeding expectations, and a 36% growth in total daily production and a 63% rise in daily oil production in Q1 2025 compared to the same quarter last year. Despite this, the analyst believes certain AI stocks offer greater upside potential and carry less downside risk.

In the rapidly evolving landscape of artificial intelligence (AI), several companies are positioning themselves to capitalize on the technology's transformative potential. Susquehanna analyst Biju Perincheril recently maintained a Hold rating on SM Energy Company (NYSE: SM), suggesting that certain AI stocks may offer greater upside potential and carry less downside risk.

One such company is Palantir Technologies (NASDAQ: PLTR). Palantir's AI Platform (AIP) is not merely an enhancement to existing solutions but aims to become the operating system of AI. By pulling data from across an organization and mapping it to real-world processes, Palantir makes AI more actionable. The platform is already used in various industries, from managing battlefield intelligence to decommissioning old equipment and monitoring for sepsis in hospitals [1].

Palantir has seen its revenue growth accelerate, particularly in the U.S. commercial sector. The company's largest customer, the U.S. government, has also increased its spending, making Palantir a key vendor in modern warfare. A recent deal with NATO could unlock further international defense wins. The stock is expensive, but if AIP becomes the go-to operating system for enterprise AI, Palantir could grow significantly [1].

Advanced Micro Devices (NASDAQ: AMD) is another company poised to benefit from AI's evolution. While AMD has historically played second fiddle to Nvidia (NASDAQ: NVDA), the market is shifting towards inference, where AMD has been gaining traction. Inference involves speed and cost, areas where AMD's graphics processing units (GPUs) are proving effective. Last quarter, one of the world's largest AI model companies started running a significant share of its inference traffic on AMD's hardware [1].

AMD's UALink protocol, an open-source standard for communication across servers in AI data centers, could challenge Nvidia's closed NVLink standard. If UALink becomes the go-to interconnect, data centers will be able to mix and match AI chips, opening the door for AMD to gain significant market share. AMD does not need to overtake Nvidia to be an AI winner, as even modest gains could lead to substantial upside [1].

AppLovin (NASDAQ: APP) may not immediately sound like an AI company, but its AI-driven advertising engine, Axon 2, has transformed gaming app advertising. Axon 2 uses predictive machine learning to optimize ad targeting, bidding, and placement. While currently focused on gaming apps, AppLovin's bigger opportunity lies in expanding into e-commerce and web-based ads. If Axon 2 can deliver similar results outside gaming, the stock's upside potential is substantial [1].

Despite these promising prospects, every stock carries risks. However, the potential for significant growth in these AI stocks, driven by technological shifts and expanding market opportunities, makes them intriguing options for investors.

References:
[1] https://www.mitrade.com/insights/news/live-news/article-8-995704-20250730
[2] https://finance.yahoo.com/news/3-millionaire-maker-artificial-intelligence-000700268.html