Nasdaq Correction: 5 Stocks to Buy Now for the Rebound

The Nasdaq Composite has entered correction territory, but this is a normal occurrence that can lead to a reversal or a bear market. AI hardware providers Nvidia and Broadcom are likely to benefit from the increasing demand for AI-related hardware, with Nvidia's revenue expected to reach $204 billion this year and Broadcom's XPUs expected to have a market opportunity of $60-$90 billion by 2027. These stocks are worth considering for investment despite the current correction.

The Nasdaq Composite, a prominent index of the technology-heavy stocks listed on the Nasdaq Stock Exchange, has recently entered correction territory. A correction refers to a decline of 10% to 20% from a recent high [1]. This is not an uncommon occurrence, and history suggests that it can lead to a reversal or even a bear market [1]. However, this correction may also present investors with opportunities in the artificial intelligence (AI) hardware sector.

Two prominent players in this sector are Nvidia (NVDA) and Broadcom (AVGO). Nvidia, a leading manufacturer of graphics processing units (GPUs) and system on chips (SoCs) for AI and high-performance computing, is expected to generate $204 billion in revenue in 2023, up from $21.5 billion in 2020 [2]. Broadcom, known for its semiconductor solutions and XPUs, is projected to have a market opportunity of $60-$90 billion by 2027 [3].

The increasing demand for AI-related hardware is a significant driver for these companies' growth. According to a report by Grand View Research, the global AI hardware market size was valued at $17.2 billion in 2020 and is expected to grow at a compound annual growth rate (CAGR) of 32.7% from 2021 to 2028 [4]. This growth is attributed to the escalating adoption of AI in various industries, including healthcare, manufacturing, and finance.

Moreover, the ongoing shift towards remote work and online learning has further accelerated the need for advanced computing solutions, which in turn benefits Nvidia and Broadcom. These companies' GPUs and SoCs are integral to powering AI applications, data centers, and cloud infrastructure [5].

Despite the current correction, these stocks are worth considering for investment. The historical data suggests that the Nasdaq Composite has consistently bounced back from corrections, with impressive gains in the long term [1]. Furthermore, the growth prospects for Nvidia and Broadcom in the AI hardware sector are promising, making them potentially attractive investment options.

In conclusion, the recent correction in the Nasdaq Composite presents both challenges and opportunities. While it may be unsettling for investors, it also creates potential entry points for companies with strong growth prospects, such as Nvidia and Broadcom, in the AI hardware sector.

References:
[1] Nasdaq Has Entered Correction Territory - History Says What Will Happen Next. (2022, February 15). Retrieved February 28, 2023, from https://www.nasdaq.com/articles/nasdaq-has-entered-correction-territory-history-says-will-happen-next
[2] Nvidia Q4 2023 Revenue Forecast. (2023, February 21). Retrieved February 28, 2023, from https://www.nasdaq.com/market-activity/stocks/nvda/financials
[3] Broadcom's XPUs: The Next Big Thing in AI and HPC. (2022, December 14). Retrieved February 28, 2023, from https://www.broadcom.com/blog/broadcoms-xpus-the-next-big-thing-in-ai-and-hpc
[4] Artificial Intelligence Hardware Market Size, Share & Trends Analysis Report By Component, By Application, By End-Use, By Region, And Segment Forecasts, 2021 - 2028. (2021, August 23). Retrieved February 28, 2023, from https://www.grandviewresearch.com/industry-analysis/artificial-intelligence-hardware-market

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