Artificial intelligence has been all the buzz recently, and for good reason. AI is revolutionizing almost every sector and will make shockwaves in the markets in the years to come. But how can you get involved? While almost every company will introduce artificial intelligence to some extent in the years to come, here are the best companies utilizing AI that you can invest in today.
Microsoft (MSFT)
While Microsoft isn’t exactly an unheard of company to say the least, they are one of the pioneers in artificial intelligence. In 2019, Microsoft invested one billion dollars into OpenAI, creator of the most popular AI service, ChatGPT as well as many other AI services. This investment gave Microsoft the ability to integrate OpenAI’s tools into its services. We have already seen the integration of AI into Microsoft Excel, and Microsoft is launching several AI programs such as Azure AI. Azure is already being utilized by companies including CarMax, KPMG, and EY. The combination of Mircosofts integration of AI into their existing products and the growing popularity among large companies using Azure suggests Microsoft will be a powerhouse in AI. Microsoft is already one of the largest companies in the world and its ventures into AI means that MSFT is a must buy if you want to capitalize on the artificial intelligence revolution. MSFT currently sits at $322.46, up 34.59% YTD. Even after its positive 2023, many analysts predict Microsoft's growth will continue into 2024, surpassing the $400 mark.
Nvidia Corp. (NVDA)
The former graphic processing unit (GPU) company has shifted its focus almost entirely into AI. The shift in Nvidia’s corporate structure came from the need for Nvidia’s GPUs to run AI programs such as ChatGPT. With Artificial intelligence on the rise, new companies will need to use Nvidia's processing chips. This puts Nvidia in a strong position as no matter which new company or existing giant becomes the industry leader in AI, Nvidia will be a winner as well. The current drawback to investing in Nvidia is the already huge boost to NVDA’s share price. NVDA is up 323.62% YTD, massively overvalued the stock at current, with investors hoping the rise in AI will continue to boost their profitability. However, all hope isn’t lost for investing in NVDA, what we often see with stocks that have massive leaps following a good earning report is a slow decline as investors get nervous about the company actually reaching the heights expected. Analysts are maintaining a buy rating for the stock with an estimated stock price of close to 500 dollars, with share price currently sitting on 466 dollars, if NVDA begins to drop, it may be a worthwhile investment to capitalize on the growth of AI.
Palantir Technologies Inc.
Palantir is most likely an unknown stock to the casual investor. While it's not reaching the same levels as other AI related companies, Palantir Technologies is one to keep an eye on in 2024. Palantir creates AI software to advise companies on decision making across various different industries including tech and war. Palantir is not performing well at current, with earnings per share at around zero. If you choose to invest in this stock do not expect short term gains, with most analysts forecasting a 12 month price target of 16 dollars per share. With the stock currently sitting at 13.92, this is not a significant upside in the short term. However, with AI continuing to grow and many corporations expected to integrate AI into their operations, Palantir could have massive upside in the next five years.
(Disclaimer: This is not professional financial advice and rather is the opinions of the author, if you want professional investment advice seek a professional investor/asset manager)
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