Investing.com — Here are the biggest analyst moves in the field of artificial intelligence (AI) for this week.

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BofA cuts Tesla’s rating to high risk of execution

Earlier this week, Bank of America downgraded Tesla (NASDAQ: ) to Neutral from Buy, while raising its price target to $490 from $400.

Analysts flagged high execution risks as the main reason for the downgrade, as the current valuation already reflects much of Tesla’s long-term potential in core autos, robotaxis, Optimus, and energy businesses.

BofA analysts, led by John Murphy, see Tesla’s robotaxi service as the biggest opportunity, accounting for nearly 50% of its valuation. The service, expected to launch in 2025, could be worth $420 billion in the US and more than $800 billion worldwide.

Initially, Tesla is expected to own and operate the fleet, with third-party providers joining later. While the rollout may start slowly with high costs per mile, Tesla’s lack of drivers offers a significant cost advantage over competitors like Uber (NYSE:) and Lyft (NASDAQ:).

Tesla’s Full Self-Driving (FSD) technology also holds a significant value, estimated at $480 billion.

BofA projects that 23 million vehicles may feature FSD in 2030, growing to 75 million in 2040, generating significant EBIT with higher margins than its core automotive segment. Analysts note that this valuation does not yet include potential licensing opportunities with other automakers.

Potential future catalysts for Tesla include an affordable model launch in early 2025, a new model later that year, the robotaxi rollout in mid-2025, and Megapack production scaling. in Shanghai in Q1 2025.

Additional drivers include updates to FSD subscriptions, development of the Optimus humanoid robot targeting 1,000 units by the end of 2025, and potential risks from adverse policy changes.

AMD downgraded by HSBC, lower price target

HSBC analysts downgraded Advanced Micro Devices (NASDAQ: ) stock to Reduce from Buy on Wednesday and cut their price target to $110 from $200, citing concerns about AMD’s AI GPU roadmap, which analysts view as less competitive.

Analysts cited challenges to AMD’s ability to gain traction in the AI ​​GPU market, pointing to strong demand for the company’s MI325 GPU and possible delays in delivering a rival NVL platform product. rack of Nvidia (NASDAQ:).

For that reason, HSBC lowered its projection for AMD’s AI GPU revenue in fiscal 2025 (FY25) to $8.1 billion, from $12.3 billion, which fell below the estimate of $9.5 billion.

“AMD’s share price has corrected 24% over the past three months but we believe there remains additional downside,” HSBC analyst Frank Lee wrote in a note. “We believe that AMD will not be able to enter the AI ​​GPU market as we previously expected.”

HSBC expects AMD to launch the MI350 chip in the latter half of 2025, according to its schedule. However, analysts do not see the introduction of an AI rack solution capable of competing with Nvidia’s NVL rack platform until late 2025 or early 2026, which coincides with the planned launch of AMD’s MI400 chip.

The downgrade also reflects concerns over AMD’s slowdown in its client business and limited growth potential for non-AI data center revenue in FY25.

Salesforce Top Pick for 2025 in Needham

Needham & Company named Salesforce Inc (NYSE: ) top pick for 2025 in Enterprise Software (ETR:) sector, adding the stock to its Conviction List.

In a note on Wednesday, the company raised its price target on Salesforce from $375 to $400, driven by optimism around the company’s Agentforce ( AF ) strategy.

“CRM is our 2025 top pick in our Enterprise Software universe,” Needham said, emphasizing confidence in Salesforce’s ability to execute and monetize the new initiative. The company highlighted that Agentforce is now a key component in nearly half of its enterprise customer deals, signaling its growing importance in the Salesforce ecosystem.

“AF is an active ingredient in nearly half of enterprise customer-sized deals,” the analysts said. While initial deal sizes remain small, Needham expects a substantial ramp-up in the second half of the year if pilot programs prove successful.

AI will play a key role in Salesforce’s strategy, with rapid hiring of AI-focused sales representatives expected to drive stronger bookings in the second half. “AI-focused sales rep hiring is moving quickly, which should help with 2H bookings,” Needham continued.

The company also points to the “halo effect” of Agentforce, which is becoming increasingly apparent. Products like Mulesoft are expected to benefit greatly from the wider adoption of Agentforce.

“The Halo effect becomes real, Mulesoft probably benefits more than other CRM products,” the note added.

From a valuation perspective, Needham sees Salesforce as attractive, trading at 24x FY26 free cash flow estimates. The company has forecast 20% FCF growth in FY26, which supports its bullish outlook for the stock.

2025 is the key AI adoption inflection year: Evercore ISI

Evercore ISI sees 2025 as a key year for the widespread adoption of AI, despite the momentum of emerging technology advancing across industries.

While corporate earnings call for more talk of AI, capital spending on hyper-scalers remains strong, and interest in AI technologies, as measured by Google searches (NASDAQ: ), reached a record level, the actual implementation was delayed.

“With consumers enthusiastic about adopting AI but sentiment in Corporate America somewhat muted, 2025 will be the critical AI adoption inflection year,” Evercore strategists led by Julian Emanuel wrote in a note on Sunday.

AI capabilities have advanced significantly, moving beyond chatbots to automating complex physical and digital tasks. In 2024, generative AI is fueling the development of robotics, autonomous digital agents, and manufacturing tools.

These advances, rooted in advances in Inference Time Reasoning, communication, and training data, will enable AI systems to “think” before acting, marking a significant shift in function.

As AI-driven innovation continued, investor sentiment turned cautious in mid-2024, leading to the first significant pullback in AI-exposed stocks since the launch of ChatGPT.

The company believes that AI will fundamentally change skilled work, solving labor shortages.

Evercore identifies key players in the AI ​​ecosystem as “Enablers, Adopters, and Adaptors,” highlighting their importance in portfolio strategies for 2025. These companies are expected to play a key role in driving of corporate adoption as businesses increasingly view AI as essential to staying competitive.

“We believe that 2025 will attract many participants in the “AI Revolution” because technological advances and its application make AI a “must have” for companies’ ability to compete effectively in coming years,” wrote Emanuel and his team.

Analysts maintained their confidence in the transformative impact of AI, projecting the S&P 500 to hit 6,800 by the end of the year.

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