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As with nearly every other computing technology company earnings call in recent months (and non-tech company earnings calls too, for that matter), GitLab (NASDAQ: GTLB) led off its most recent financial report by talking about artificial intelligence (AI). AI, of course, is nothi

The run in hot FANGMA stocks (META, AMZN, NFLX, GOOGL, MSFT, AAPL), which can be measured by the Evolve FANGMA Index ETF Trust Units CAD Hedged ETF ( TSE:TECH) , has been very impressive. It certainly did not take long for sentiment to take a 180-degree turn, sending some FANGMA stocks to new heights just months after touching down with ominous depths. Undoubtedly, it would have been nice to get in a few months ago. Though it seems like the surge is a forgone opportunity, analyst bullishness suggests that big tech's recent run still has room to gain. I'm inclined to agree with the analyst community. FANGMA stocks have more room to run, and it's not just thanks to the AI boom! Therefore, let's use TipRanks' Comparison Tool to check in with three AI-savvy FANGMA names and see where analysts stand. Amazon ( NASDAQ:AMZN) Amazon is an e-commerce and public cloud behemoth that hasn't been nearly as hot as some of its big tech peers, some of which are sitting at or around new all-time highs. Going into the second half, I view Amazon stock as the FANGMA company with the most room to surge. Undoubtedly, Amazon is the priciest of the group. However, I still believe that its disruptive capabilities will help it grow into its seemingly sky-high price-to-earnings multiple (it's over 300 times trailing price-to-earnings and 71 times forward price-to-earnings). Sure, a lot of enthusiasm is already baked into the share price. Still, I view new highs as a realistic target for the original innovator, especially as interest rates look to peak. All considered, I remain bullish on AMZN stock. The cloud and e-commerce segments aren't soaring into the clouds as they used to, thanks partly to a hazy economic climate. Indeed, growth in both areas could rebound after a recession concludes. If no recession unfolds, Amazon's road to recovery could continue at the current blistering pace. Even if the coming expected recession is rocky and longer lasting, the company has some growth drivers brewing, and it's these disruptive innovations that could help keep the good times (at least on a year-to-date basis) going for Amazon stock investors. Year-to-date, the stock is up around 52%. With skin in the AI game via its Amazon Bedrock AI service (which offers customizable AI models for easy integration into applications) and a smartening Alexa (Amazon's cloud-based voice service), I view Amazon as one of the AI companies that may not have as much AI hype built in at current levels. We've heard a lot about OpenAI and ChatGPT this year. Up ahead, I'd look for Amazon to step up to the plate with its AI innovations. What is the Price Target for AMZN Stock? Amazon's a Strong Buy on Wall Street, with a whopping 37 Buys and just one Hold. The average AMZN stock price target of $137.62 implies upside potential of 7%. Microsoft ( NASDAQ:MSFT) Microsoft stock recently hit a new high, just months after ChatGPT shined a bright light on the potential of generative AI and large language models. As ChatGPT gets stronger and more widely available across a slew of productivity applications, it seems like Microsoft is on a breakaway, leaving many of its rivals in the dust. Microsoft's rivals have been going heavy on AI innovation of late, and they can catch up. That said, it may prove difficult to dethrone Microsoft as it explores new possibilities with the power of AI. Even at today's frothy valuations, I find it hard to be anything but bullish on the stock. Shares of Microsoft are the most expensive they've been in quite a while. At 36.7 times trailing price-to-earnings, MSFT stock is on the high end of the historical valuation spectrum. Over the last five years, Microsoft has averaged a 33.4 times trailing price-to-earnings multiple. Undoubtedly, there's a lot of AI expectations factored in. As Microsoft keeps rolling out new AI features across its ecosystem, earnings could get a nice jolt. The magnitude of this jolt, though, remains a question mark. Executives see plenty of ways that Microsoft hits $10 billion (or more) in annual AI ARR (annual recurring revenue). Arguably, Microsoft could exceed such estimates, perhaps sooner than expected, if AI plays well with the company's existing offerings. After the hot run, several analysts have hiked their price targets, some by generous amounts. J PMorgan recently hiked its price target from $315 to $350. What is the Price Target for MSFT Stock? Microsoft is still a Strong Buy on Wall Street, with 30 Buys, four Holds, and one Sell. Nonetheless, the average MSFT stock price target of $347.57 entails a small 2.3% gain from here. Alphabet ( NASDAQ:GOOGL) I view Alphabet stock as a must-own for new investors looking to bet on AI. When it comes to AI innovation, it's easier to bet on the products we've had a chance to interact with. Though Google has its Bard AI, a vast majority of the company's AI innovations aren't yet ready for consumers to play with. Arguably, Google's AI innovations are too powerful (and risky) to be unleashed to the public right now. This could change once regulations come to be while guardrails improve. For now, though, GOOGL stock certainly doesn't seem like the "hottest" AI stock to own for investors. Still, give it a few years, and I'd look for Google to flex its AI muscles. Arguably, Google may have bigger AI muscles than some of its pricier peers. For this reason, I'm bullish on GOOGL stock and view it as relative value in a hot space. Though GOOGL may be relatively cheap, given the AI talent (consumer-facing and behind-the-scenes) you're getting, the stock still trades well above where it spent most of last year (it averaged a 17.54 times trailing price-to-earnings multiple in 2022). At 27.7 times trailing price-to-earnings, there's some AI enthusiasm baked in. Nevertheless, my guess is that there's not enough, given the monetizability of Google's large language models. What is the Price Target for GOOGL Stock? Alphabet is a Strong Buy based on 28 Buys and three Holds assigned in the past three months. The average GOOGL stock price target of $131.48 implies 6.8% upside potential. Conclusion FANGMA stocks have a lot to gain from AI, and of the three AI-savvy stocks in this piece, analysts expect the most upside from Amazon stock. Disclosure

The S&P 500 and the Nasdaq closed higher on Thursday as U.S. Federal Reserve Chairman Jerome Powell continued to beat a hawkish drum and suggested the central bank has not reached the end of its tightening cycle, but provided reassurance that the Fed would proceed with caution.

We often hear investors talk about how hard it is to "beat the market" over time, and when it comes to ETFs, for the most part, they are right. ETFs that beat the broader market indices like the S&P 500 ( SPX ) over the long run are rare.  Using the Vanguard S&P 500 ETF ( NYSEARCA:VOO) as a proxy for the S&P 500, it’s easy to see why. As of the end of the most recent month, the fund has provided enviable total annualized returns of 12.8% over the past three years, 11% over the past five years, and 11.9% over the past 10. Since its inception in 2010, the fund has returned 13.3% annually. The Invesco S&P 500 Quality ETF ( BATS:SPHQ) is an ETF that also invests in the S&P 500, albeit with more specific criteria. Let’s take a look at if it is a good investment opportunity and how it stacks up to the Vanguard S&P 500 ETF, with a focus on long-term performance.  What Does the SPHQ ETF Do? SPHQ is a $5.3 billion ETF from Invesco that invests at least 90% of its assets in the S&P 500 Quality Index. This index takes the S&P 500 and invests in the stocks with the highest quality score, which is based on financial metrics like return on equity, changes in net operating assets, and financial leverage.  SPHQ vs. VOO Portfolio Comparison SPHQ is fairly diversified, with 101 holdings, and its top 10 positions make up 48.5% of the fund. Below, you can take a look at SPHQ’s top 10 holdings using TipRanks’ holdings tool. VOO sports 505 positions, investing in the entire S&P 500. Its top 10 holdings make up 30.4% of the fund. Take a look at VOO’s top holdings below. VOO is clearly more diversified, as it invests in the entire S&P 500 instead of just a segment of it, but overall, both of these ETFs are well-diversified.  Additionally, as you can see in the tables above, there is some overlap between SPHQ and VOO despite their different strategies. Both ETFs count Apple ( NASDAQ:AAPL ) and Microsoft ( NASDAQ:MSFT ) among their top 10 holdings. However, SPHQ has top 10 positions in integrated oil majors like ExxonMobil ( NYSE:XOM ), payment networks Visa ( NYSE:V ) and Mastercard ( NYSE:MA ), and consumer staples like Procter & Gamble ( NYSE:PG ).  Six of SPHQ’s top 10 holdings have Smart Scores of 8 or above, while five of VOO’s do. The Smart Score is TipRanks’ proprietary quantitative stock scoring system. It gives stocks a score from 1 to 10 based on eight market key factors. The score is data-driven and does not involve any human intervention. A Smart Score of 8 or above is equivalent to an Outperform rating. SPHQ and VOO feature identical ETF Smart Scores of 8.   Comparing Their Long-Term Track Records  When looking at any ETF, you want to evaluate its performance over time. SPHQ has provided its investors with very solid results for a long time. As of the end of May, SPHQ has a three-year annualized total return of 12.4%, a five-year annualized total return of 11.4%, and a 10-year annualized total return of 12.1%. Double-digit returns over the course of a decade are the type of results that help investors to build long-term wealth, making SPHQ an attractive ETF to own.  Over time, SPHQ’s results have been comparable to those of VOO. Over the past three years, VOO has beaten SPHQ by a narrow margin with a total annualized return of 12.8%. But over the past five years, SPHQ’s annualized return of 11.4% is actually slightly better than VOO’s 11% return. Over the past 10 years, SPHQ also leads VOO by a narrow margin of 12.1% to 11.9.%, making SPHQ one of the rare ETFs that can say it has "beaten the market" over the long term, albeit by a very narrow margin.  Which ETF Has Lower Fees? SPHQ has a reasonable expense ratio of 0.15%. This means that an investor putting $10,000 into SPHQ today would pay $15 in management fees in year one. Assuming the fee remains constant and that the fund returns 5% a year, an investor in SPHQ would pay $53 in fees after three years, $99 after five years, and $234 over the course of a decade.  These are reasonable enough fees especially given SPHQ’s double-digit returns. However, VOO’s returns are comparable, and its fees are much lower. With an expense ratio of 0.03%, an investor in VOO would pay just $3 in fees in year one, $10 over three years, $17 over five years, and $39 over the course of the decade, offering substantial savings against SPHQ.  Investor Takeaway Ultimately, SPHQ is one of the few ETFs that can make a credible claim that it has beaten the market over the long term since it has outperformed a broad S&P 500 fund like VOO over the five and 10-year time frames, albeit by narrow margins. On the other hand, VOO offers a much lower expense ratio than SPHQ for a roughly similar performance.   An investor putting $10,000 into SPHQ over the past 10 years and earning a 12.1% total annualized return would now have a position worth about $31,337. Meanwhile, an investor putting the same amount into VOO would have $30,782. Both investors would be pretty happy with their returns, but SPHQ has the edge. Keep in mind that past performance is no guarantee of future results, so there’s no guarantee that SPHQ’s strategy will outperform the S&P 500 again over the next decade. Going forward, the ETFs currently look somewhat different in terms of their current portfolio composition, with VOO having the large-cap tech stocks that dominate the S&P 500 index in terms of market cap, whereas SPHQ features some of these stocks but leaves out some prominent names like Amazon and Tesla. Overall, these are both great ETFs to own, and both have helped investors compound double-digit total returns for years. Holding either of these ETFs has helped investors to more than triple the size of their investments over the past 10 years. The choice between the two may come down to your preference based on the current flavor of their portfolios, as described above. Conversely, there is no need to pick just one, an investor could invest in both ETFs and likely be happy with their long-term results. Disclosure

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