Goldman has a long-term AI winners portfolio. Here’s what’s in it

As investors deliberate what’s next for the artificial intelligence trade, Goldman Sachs has some long-term winners that can come out on top. Generative AI is broadly anticipated to benefit companies as a whole. But, for the moment, it has bolstered only a handful of companies in what Goldman Sachs is calling the first phase of the AI trade. In these early days, Nvidia has been the notable exemplar, rising more than 70% this year. In fact, investors will seek insight into where the AI chipmaker will go from here this week at Nvidia’s GTC Conference, with many analysts increasing their price forecasts for the stock ahead of the event. Nvidia shares were up more than 2% on Monday. But other names are starting to emerge. Analyst Ryan Hammond anticipates there will be four total stages in the AI trade, with the next, second phase chiefly benefiting companies that build and maintain infrastructure for AI, such as chipmakers, cloud providers and other firms. In the third phase, he expects companies using AI to lift their revenue will get a boost. Goldman Sachs anticipates the long-term winners are in the fourth and final phase. These companies will boost their bottom lines with the productivity gains unlocked by AI. Hammond expects companies in the software and services, commercial as well as and professional services sectors will be the biggest beneficiaries of the AI adoption here. “‘Phase 4’ (Productivity gains) will focus on all companies harnessing AI technology to improve productivity, with the largest potential efficiency gains in labor-intensive industries with jobs more exposed to AI automation,” Hammond wrote in a Thursday note. Here are some of the names the firm surfaced. One megacap name that surfaced was Amazon , which is already higher this year by more than 15%. However, Goldman Sachs said the productivity gains to be had from AI would boost earnings per share for the company by roughly 39%. Pinterest was another name that was identified by the Wall Street firm. The image-sharing platform has underperformed this year, and is down more than 7%. But Goldman Sachs said baseline earnings can jump 162% because of AI. The big-box retailer that can see sizable gains is Walmart . The company is up more than 15% this year. Goldman Sachs expects Walmart can eventually use automation to lower its labor costs. It predicts about 31% of its wage bill is exposed to AI. That means over time, Walmart could see a boost of 44% to earnings per share. The New York Times and Kohl’s were other names that surfaced.