Artificial intelligence (AI) stocks offer an attractive investment thesis. Because we’re at the beginning of a potentially game-changing story. It could change the way we manage our day-to-day operations, increase the efficiency of companies, and lead to big discoveries in fields such as healthcare. JPMorgan Chase CEO Jamie Dimon likens AI to the transformation of printing presses and electricity.
This means today could be a once-in-a-decade investment opportunity, with stocks available at affordable prices in certain high-potential AI companies. With the AI market expected to grow from $200 billion today to potentially $1 trillion by 2030, the stock prices of these companies could rise as more investors realize the revenue potential. There is sex. As a result, the stock price could be much higher than it is now.
That’s why now is the perfect time to shop around for a solid AI player, and these two should be at the top of your buying list.
Image source: Getty Images.
Alphabet (NASDAQ: GOOG) (NASDAQ: GOOGL) is perhaps best known for its masterpiece: Google Search. This search engine is the world’s number one with a market share of over 90%, rivaling Alphabet’s revenue powerhouse. Advertisers flock to the platform to reach Google search users, generating billions of dollars in revenue for the company.
Over the past few years, Alphabet has entered the world of AI, using the technology to improve Google search and selling AI tools to customers of its cloud computing business, Google Cloud. So as Google Search becomes more powerful and we spend more time using Google Search, AI could help Alphabet collect more ad dollars…and AI is already helping cloud businesses generates revenue for Alphabet through
In fact, Alphabet said in its latest earnings report that its AI infrastructure and generative AI solutions have already brought in billions of dollars in revenue this year. The cloud business posted double-digit revenue growth and triple-digit operating profit growth in the quarter, reaching milestones of $10 billion and $1 billion, respectively.
Meanwhile, Alphabet’s stock remains reasonably priced, trading at 21 times forward earnings, offering an excellent opportunity to get in early on this potentially explosive AI growth story.
Mark Zuckerberg, CEO of Meta Platforms (NASDAQ: META), has been very outspoken about his AI ambitions. His goal is to make Meta a leader in AI, and he has poured investment capital into developing large-scale language models, training them, and using them to fuel products such as AI assistants. Zuckerberg said he hopes Meta can one day provide users with an assistant for all their needs, from leisure to professional.
story continues
Given Meta’s commitment to technology exploration, we might also expect other AI-based products and services from Meta. Meta has made AI its biggest investment area this year, with 600,000 graphics processing units. The tech giant is one of top chip designer Nvidia’s major customers and has gone all-in on the technology, even developing its own chips.
While Meta invests in this high-growth space, it’s also important to remember that the company continues to generate billions of dollars in revenue thanks to its ownership of Facebook, Messenger, WhatsApp, and Instagram. Like Alphabet, the company makes most of its revenue from advertising, and like Alphabet, advertising revenue could increase if AI helps improve its products, in this case social media apps. .
Meta stock currently trades at 27 times forward earnings estimates, which looks like an absolute steal given the company’s position in the high-growth space of AI, solid earnings history and financial position – Meta also started paying a dividend this year, indicating it has the headroom to fund growth and reward shareholders. All of this means now could be a unique opportunity to get involved in this top AI story.
Have you ever felt like you missed out on buying the most successful stocks? Then you’ll want to hear this.
On rare occasions, our team of expert analysts will issue a “Double Down” stock recommendation on a company we think is about to crash. If you’re already worried that you’re missing out on an investment opportunity, now is the best time to buy before it’s too late. And the numbers speak for themselves.
Amazon: If you invested $1,000 when it doubled in 2010, you would have earned $21,365. *
Apple: If you invested $1,000 when it doubled in 2008, you would have earned $44,619. *
Netflix: If you invested $1,000 when it doubled in 2004, you would have earned $412,148. *
We currently have “double down” alerts on three great companies, and we may not see an opportunity like this again anytime soon.
See 3 “Double Down” stocks »
*Stock Advisor will return as of October 21, 2024
Alphabet executive Suzanne Frye is a member of The Motley Fool’s board of directors. JPMorgan Chase is an advertising partner of The Motley Fool’s Ascent. Randi Zuckerberg is a former head of market development and spokesperson at Facebook, sister of Meta Platforms CEO Mark Zuckerberg, and a member of the Motley Fool’s board of directors. Adria Cimino has no position in any stocks mentioned. The Motley Fool has positions in and recommends Alphabet, JPMorgan Chase, Meta Platforms, and Nvidia. The Motley Fool has a disclosure policy.
“Once in a Decade Opportunity: 2 Artificial Intelligence (AI) Stocks to Buy Now” was originally published by The Motley Fool.
