Investing.com -- Cantor initiated coverage of stocks in the Infrastructure and AI software market in a note Friday, emphasizing the evolving role of AI in transforming computing, infrastructure software, and data management.
According to Cantor, "The value proposition of infrastructure software will increase, driven by the ongoing secular expansion of AI and GenAI."
Cantor analysts highlight the importance of unified, secure, and integrated data systems, alongside real-time computing, networking capabilities, and enhanced workflows.
They believe "cloud infrastructure platforms [are set] to play a central role in consolidating these functions" as application development shifts left, broadening the industry's addressable markets.
Monetization in the AI-driven world is expected to come from increased usage and consumption, as well as direct charges for AI features like "copiloting, advanced collaboration, and autonomous, adaptable decision-making AI agents powered by Agentic AI."
Cantor's top stock picks in this sector are
MongoDB (NASDAQ:MDB): Rated Overweight with a $344 price target, offering a 42% upside. Cantor expects strong growth driven by AI adoption.
Oracle (NYSE:ORCL): Overweight with a $214 price target, reflecting a 37% upside. Oracle is expected to benefit from its robust cloud services.
Monday.com: Overweight with a $292 price target, offering a 33% upside. Monday.com is recognized for its innovative workflow solutions.
Other notable mentions include Microsoft (NASDAQ:MSFT), Datadog (NASDAQ:DDOG), ServiceNow (NYSE:NOW), Five9 (NASDAQ:FIVN), and Snowflake (NYSE:SNOW), all rated Overweight with significant growth potential due to their positions in cloud infrastructure and AI.
Elsewhere, companies such as Dynatrace (NYSE:DT), Zoom (NASDAQ:ZM), Palantir (NASDAQ:PLTR), Atlassian (NASDAQ:TEAM), and Cloudflare (NYSE:NET) are rated Neutral.