A trillion-dollar asset manager is betting on select technology names, including Alphabet (GOOGL), to outlast the noise around artificial intelligence.
In a new CNBC interview, Nuveen chief investment officer Saira Malik highlights two AI companies she believes are positioned to dominate the long run.
“So just looking at, first of all, AVGO (Broadcom) and Alphabet, both of these companies are positioned very well.
With AVGO, they have huge demand from hyperscalers for their A6 chips, very strong management team, and the ability to earn very strong earnings growth going forward. The stock actually is not as expensive as one might think, given its earnings growth trajectory.
Looking at Alphabet, people are worried about what will the impact of OpenAI be on Google’s advertising business and Genesis. I think the impact is not going to be as great as people think. And you have the upside from Waymo and their YouTube business. So if you’re looking at AI, you want to own the companies that will be winners over the long term, which were the two I just talked about.”
While Malik is long-term bullish on Broadcom and Alphabet, she urges investors to trim their risk by investing in other sectors that she believes will benefit from the massive AI infrastructure buildout.
“And then you can balance that. We are seeing the market broaden out a bit. So there are areas like infrastructure, which has its own tailwinds.
It is a data center play — we build more of those in the U.S. But as we need to electrify our grids, part of infrastructure is utilities. So we’re going to need more and more upgrades to our utilities.
And then, of course, waste management is a big component of infrastructure. So it’s a sector that tends to be a little bit more defensive and an inflation hedge. So you can offset some of your tech picks with areas that are more defensive, like infrastructure.”
Nuveen, headquartered in New York, manages about $1.2 trillion in assets under management (AUM).
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