Benzinga - by Adam Eckert, Benzinga Staff Writer.
Deepwater Asset Management’s Gene Munster sees two large AI opportunities in the Magnificent Seven that the Street seems to be missing.
What To Know: Thursday morning on CNBC’s “Squawk Box,” Munster flagged Meta Platforms Inc (NASDAQ:META) and Apple Inc (NASDAQ:AAPL) as two of the most underappreciated AI plays in the market.
“They have the biggest upside potential relative to where expectations are,” Munster said.
It’s well known that Meta is using AI to improve advertising campaigns and engagement and such should help Meta grow its business by 50% over the next two years, Munster said.
“But there is a significant underappreciated lever that could take this into just a whole different atmosphere,” Munster said.
Deepwater’s research on Meta’s open source large language model Llama suggests that the company could look to monetize the platform. Most other LLMs are closed off, which creates a huge opportunity for Meta, Munster explained.
If Meta does monetize Llama, the company will likely announce some sort of cloud infrastructure and enter into the same space as Amazon’s AWS, Microsoft’s Azure and Google Cloud, he said.
The tech analyst told CNBC that he believes Meta is the “biggest AI opportunity that is misunderstood.”
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Apple is another underappreciated AI story. The iPhone maker is preparing to release its own foundation model and Munster expects the release to come sometime in June, he said.
“Most investors believe Apple is asleep at the wheel of AI. It’s the opposite,” Munster said.
The foundation model will be focused on personalized AI. Munster expects it to capture about 20% of the market. He noted that the company can charge about $10 per month for the service.
“You want to go to where ultimately the unknown opportunities are. I think Llama, and I think personalized AI with Apple, those are the two biggest unknowns or biggest opportunities relative to where the Street’s at,” Munster said.
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META, AAPL Price Action: At the time of publication, Meta shares were down 0.66% at $466.49 and Apple shares were down 0.73% at $188.02, according to Benzinga Pro.
Photo: Joshua Woroniecki from Pixabay.
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