Shares of C3.ai (AI 3.02%) were moving higher today after the AI-focused software-as-a-service (SaaS) company was name-checked by Oppenheimer on its list of stocks to own in 2024.
As of 1:06 p.m. ET, the stock was up 3% after climbing as much as 10.8% earlier in the session.
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Oppenheimer calls C3.ai a buy
The research firm put out a note this morning calling several AI stocks buys in 2024 and arguing that "AI infrastructure arms suppliers" should do well next year.
While C3.ai wasn't among Oppenheimer's top picks in 2024, which included Microsoft and Cloudflare, it was among the stocks they saw benefiting from the emergence of the AI sector. It also expects data collection and model training to drive more AI application revenue in the second half of the year to benefit C3.ai, among other companies.
Can C3.ai keep going higher?
Oppenheimer's comments seem to dovetail with remarks C3.ai CEO Thomas Siebel has made as Siebel has hyped the demand for C3.ai's products time and again despite weak quarterly results.
In the recently reported fiscal second quarter, C3.ai delivered 17% revenue growth, but it continued to report wide losses on the bottom line. It also did not raise its full-year revenue guidance but lowered its expectations for operating losses. It sees $295 million to $320 million in revenue and an adjusted loss of $115 million to $135 million.
However, Siebel noted "unprecedented interest and traction in our generative AI offerings," and the company reported an 81% increase in customer engagement, a company-specific metric that includes new customers and qualified leads.
If Oppenheimer is right, C3.ai could be prepared for an acceleration in growth later this year, but it's easy to be skeptical of the stock based on its historically disappointing results.
