BNP Paribas Starts Astera Labs (ALAB) at Outperform With $225 Price Target

Astera Labs, Inc. (NASDAQ:ALAB) is one of the Must-Watch AI Stocks on Wall Street. On November 20, BNP Paribas Exane initiated coverage on the stock with an Outperform rating and a price target of $225.00.

Despite near-term weakness, the firm is bullish on the stock due to robust structural AI tailwinds. In particular, the firm believes that Amazon’s next-gen Trainium systems and AI interconnect demand will drive multi-year upside for the stock.

BNP Parisbas acknowledged how the stock has fallen more than 40% from its mid-September peak, but believes that this is an attractive entry point based on its optimism around Amazon’s next generations of Trainium server systems.

“We are initiating Astera Labs with an Outperform rating and $225 TP, representing over 50% upside. While the stock has declined more than 40% from its peak of ~$250 in mid-September due to investor concerns over the market acceptance of UALink, we view this as an attractive entry point”.

Analysts believe that the systems will likely drive significant revenue growth opportunities for Astera over the next three years.

“Astera Labs is well positioned to benefit from the rapidly growing market of high-speed interconnects in AI systems for merchant GPUs and custom ASICs.”

Astera Labs, Inc. (NASDAQ:ALAB) is engaged in the design, manufacture, and selling of semiconductor-based connectivity solutions for cloud and AI infrastructure.

While we acknowledge the potential of ALAB as an investment, we believe certain AI stocks offer greater upside potential and carry less downside risk. If you're looking for an extremely undervalued AI stock that also stands to benefit significantly from Trump-era tariffs and the onshoring trend, see our free report on the best short-term AI stock.

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Disclosure: None.