The early innings of the AI trade may be over, but Citigroup remains positive on the technology subsector, seeing cash flows as the key to unlocking the winners of the next phase. “In summary, our message is not to be too deterred by the significant year-to-date movement in profitable AI shares,” the bank said in a Friday note to clients. “Opportunities still exist in the medium and long term, since the topic of AI has a trajectory of accelerated and attractive growth [free cash flow] dynamic that should improve further from here.” Year-to-date, all things AI have seen a significant rise in valuation, with Nvidia stock leading the way, up more than 200%. While the staggering price action may suggest AI is no longer an early trade, Citi reiterated that the “initial positive thesis” appears intact and warned investors to avoid overlooking free cash flows. Citi expects many names to meet expectations growth and sees free cash flows as “increasingly attractive. There are already impressive cash-generating machines within this theme,” the bank wrote. “Recent AI developments should accentuate this feature and drive FCF margins and growth to new highs.” Given this setup, Citi evaluated AI-related stocks that are expected to outperform market growth expectations and experience increased free cash flow margins. Here are some of the stocks that made the cut: Amazon has the highest consensus expectation of more than 48% long-term growth. Stocks have gained nearly 54% this year as Wall Street swings back to tech stocks after crashing in 2022. Some investors have seen the e-commerce giant as lagging behind its peers in the AI race. During an interview with CNBC this month, CEO Andy Jassy allayed some of those concerns, reiterating Amazon’s plan to invest in AI in all segments. Earlier this year, Amazon also introduced a generative AI service called Bedrock for its Amazon Web Services unit, which allows customers to use language models to create their own chatbots and image-generating services. Competitor chatbot heavyweight Alphabet also made the cut. Shares of parent Google and the creator of Bard are up 38% as it battles Microsoft-backed OpenAI’s ChatGPT. Consensus estimates long-term growth to be over 17%, with a short-term free cash flow margin of almost 24%. GOOGL YTD mountain Alphabet stocks in 2023 A handful of financial stocks were also listed on Citi’s screen. Mastercard offers the highest short-term free cash flow yield of the group at 48.4%. Its long-term consensus growth estimate is around 19%. Shares have gained around 15% so far this year. Ford Motor, Match Group and ServiceNow are also on the list. — CNBC’s Michael Bloom contributed reporting.