Companies that mentioned AI saw an average stock price increase of 4.6%, nearly double that of companies that did not.
Can the mere mention of ai move stock prices in 2023?
In 2023’s market, the relationship between technological trends and stock market fluctuations has taken center stage. Artificial intelligence's (AI) pervasive presence has proven to have a powerful impact on stock prices — some even refer to the AI boom as a "bubble" and compare it to the dot-com bubble. They claim that merely mentioning AI can cause a rise in the stock price. But is it true? If so, how impactful is the mention of AI on stock price? In this analysis, we’ll explore the topic in detail.
Methodology
We investigated how the mention of the term "AI/artificial intelligence" and AI-similar terms (e.g., machine learning, automation, robots, etc.) in earnings calls affected the stock price of S&P 500 companies.
1/
Initially, we gathered the quarterly earnings call transcripts for the company from Q1 2022 to Q2 2023 from Motley Fool and Seeking Alpha.
2/
Then, we counted the number of AI mentions in the call and analyzed each AI-related statement using SentiStrength, a sentiment analysis tool.
3/
From there, we collected the 3-day change in the price of the company's stock, beginning with the date the transcript was released.
Before we proceed with the analysis, please note the following:
- Every price change mentioned in this article is a 3-day change commencing on the date the earnings call transcript was published.
- The companies analyzed in this study are S&P 500 companies.
- All AI mentions used in this article were analyzed from earnings call transcripts.
Key Findings
1
Companies that mentioned AI saw an average stock price increase of 4.6%, nearly double that of companies that did not.
3
71% of technology companies saw a stock price rise after mentioning AI. On average, they rose by 11.9%..
MENTIONING AI IN EARNINGS CALLS — HOW IT AFFECTED S&P 500 COMPANY STOCK PRICES
Among companies mentioning AI, 67% saw a rise.
On average, they rose by
8.5%
71%
TECHNOLOGY COMPANIES
71% of technology companies that mentioned AI saw their stock prices rise. On average, they increased by 11.9%.
65%
NON-TECH COMPANIES
65% of non-tech companies that mentioned AI saw their stock prices rise. On average, they increased by 6.8%.
Among the top 20 companies that grew after mentioning AI, the average stock price increase was 27.5%
| # | Symbol | Company | Sector | Tech/Non-tech | # of AI mentions | 3D Price Change | Sentiment |
|---|---|---|---|---|---|---|---|
| 1 | ADBE | Adobe Inc. | Information Technology | Tech | 33 | 38.2% | ( + ) |
| 2 | CARR | Carrier Global | Industrials | Non-tech | 47 | 38.1% | ( + ) |
| 3 | META | Meta Platforms | Communication Services | Tech | 108 | 37.6% | ( + ) |
| 4 | MTCH | Match Group | Communication Services | Tech | 13 | 37.5% | ( + ) |
| 5 | EXPE | Expedia Group | Consumer Discretionary | Non-tech | 12 | 35.4% | ( + ) |
| 6 | EQT | EQT | Energy | Non-tech | 56 | 32.3% | ( + ) |
| 7 | FTNT | Fortinet | Information Technology | Tech | 2 | 27.5% | ( - ) |
| 8 | MAS | Masco | Industrials | Non-tech | 56 | 27.0% | ( - ) |
| 9 | NVDA | Nvidia | Information Technology | Tech | 150 | 26.3% | ( + ) |
| 10 | MCHP | Microchip Technology | Information Technology | Tech | 75 | 25.9% | ( + ) |
| 11 | AR | Target Corporation | Consumer Staples | Non-tech | 4 | 24.2% | ( + ) |
| 12 | LRCX | Lam Research | Information Technology | Tech | 17 | 23.9% | ( - ) |
| 13 | TTWO | Take-Two Interactive | Communication Services | Non-tech | 15 | 21.4% | ( + ) |
| 14 | FLT | Fleetcor | Financials | Tech | 2 | 21.1% | ( + ) |
| 15 | COP | ConocoPhillips | Energy | Non-tech | 2 | 20.6% | ( + ) |
| 16 | MPWR | Monolithic Power Systems | Information Technology | Tech | 1 | 19.9% | ( - ) |
| 17 | SHW | Sherwin-Williams | Materials | Tech | 66 | 19.9% | ( - ) |
| 18 | UAL | United Airlines Holdings | Industrials | Non-tech | 13 | 19.7% | ( - ) |
| 19 | IQV | IQVIA | Health Care | Tech | 1 | 19.3% | ( - ) |
| 20 | BKR | Baker Hughes | Energy | Non-tech | 2 | 19.1% | ( - ) |
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Adobe (ADBE) saw the greatest increase, 38.2%.
Meta (META) and Nvidia (NVDA) share prices increased by 37.6% and 26.3%, respectively. Additionally, these two companies mentioned AI the most among the top 20. On their earnings call, NVDA mentioned AI 150 times; Meta mentioned it 108 times.
Both of them were optimistic about artificial intelligence.
The average decline for the top 20 companies whose stock prices fell the most after mentioning artificial intelligence was 9.6%
| # | Symbol | Company | Sector | Tech/Non-tech | # of AI mentions | 3D Price Change | Sentiment |
|---|---|---|---|---|---|---|---|
| 1 | EL | Estée Lauder Companies (The) | Consumer Staples | Non-tech | 1 | -17.1% | ( + ) |
| 2 | ANET | Arista Networks | Information Technology | Tech | 52 | -15.5% | ( + ) |
| 3 | MKTX | MarketAxess | Financials | Non-tech | 5 | -15.4% | ( - ) |
| 4 | MRNA | Moderna | Health Care | Non-tech | 4 | -15.2% | ( - ) |
| 5 | PYPL | PayPal | Financials | Non-tech | 12 | -15.0% | ( + ) |
| 6 | NDAQ | Nasdaq, Inc. | Financials | Non-tech | 18 | -12.4% | ( + ) |
| 7 | HSY | Hershey's | Consumer Staples | Non-tech | 88 | -11.2% | ( - ) |
| 8 | AXON | Axon Enterprise | Industrials | Tech | 3 | -11.2% | ( + ) |
| 9 | KHC | Kraft Heinz | Consumer Staples | Non-tech | 1 | -10.9% | ( + ) |
| 10 | URI | United Rentals | Industrials | Non-tech | 25 | -9.2% | ( - ) |
| 11 | CAG | Conagra Brands | Consumer Staples | Non-tech | 2 | -8.3% | ( + ) |
| 12 | AEP | American Electric Power | Utilities | Non-tech | 44 | -8.1% | ( + ) |
| 13 | GPC | Genuine Parts Company | Consumer Discretionary | Non-tech | 1 | -7.0% | ( - ) |
| 14 | INTU | Intuit | Information Technology | Tech | 51 | -7.0% | ( + ) |
| 15 | LW | Lamb Weston | Consumer Staples | Non-tech | 104 | -6.4% | ( + ) |
| 16 | DGX | Quest Diagnostics | Health Care | Non-tech | 94 | -6.2% | ( - ) |
| 17 | ILMN | Illumina | Health Care | Tech | 18 | -6.0% | ( - ) |
| 18 | JNPR | Juniper Networks | Information Technology | Tech | 105 | -6.0% | ( + ) |
| 19 | PAYC | Paycom | Information Technology | Tech | 4 | -5.6% | ( + ) |
| 20 | NCLH | Norwegian Cruise Line Holdings | Consumer Discretionary | Non-tech | 2 | -5.4% | ( + ) |
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The share price of Estée Lauder (EL) fell the most. The decline was 17.1%. AI was only mentioned once by the corporation.
Two major financial companies, PayPal (PYPL) and Nasdaq, Inc. (NDAQ), saw their stock prices decline after discussing AI in their earnings calls, despite being optimistic about the technology. The respective declines for these two were 15% and 12.4%.
AI mentions skyrocketed in 2023
From this, we can see:
- In Q4 2022, the number of AI mentions increased by 171% compared to Q3 2022.
- The number of AI mentions in Q2 2023 reached an all-time high of 7358, an increase of 366% compared to Q1 2023.
- However, in Q1 2023, 80% of all AI-related mentions were positive, compared to 59% in Q2 2023.
FINAL WORDS
That concludes our analysis. Time will tell if the AI boom is a bubble. In the meantime, we will continue to monitor this trend.
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