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Investors seeking exposure to the rapidly evolving artificial intelligence (AI) sector have a multitude of artificial intelligence stocks to watch in 2024, spanning from semiconductor giants to emerging software players. The best ai stocks include Cloud Consensus Solutions, JOYY Inc. ADR, Opera Ltd., NVIDIA Corp., ServiceNow Inc., and International Business Machines Corp. – companies at the forefront of artificial intelligence innovation.
These ai stocks and artificial intelligence companies offer broad applications across industries, high investor interest, and potential for explosive growth as the ai revenue wave hits in late 2024. However, the ai sector also carries risks like industry uncertainty, rapidly shifting landscapes, and untested business models reliant on cutting-edge artificial intelligence technology.
Artificial intelligence Chip Leaders
AI Chip Leaders
NVIDIA Corp (NVDA) had an impressive 183.01% 1-year performance as of May 2024, solidifying its position as a leader in the artificial intelligence chip market. The company is at the forefront of artificial intelligence development, creating software, chips, and AI-related services that power various applications across industries.
Other notable performers in the AI chip space include:
- Procept BioRobotics Corp (PRCT) with an 88.12% 1-year performance
- Upstart Holdings Inc (UPST) with a 73.31% 1-year performance
- SoundHound AI Inc (SOUND) with a 66.73% 1-year performance
- AeroVironment Inc. (AVAV) with a 56.91% 1-year performance
- Helix Energy Solutions Group Inc (HLX) with a 48.46% 1-year performance
- Symbotic Inc (SYM) with a 44.49% 1-year performance
These companies are actively involved in developing AI-related products and services, contributing to the growth of the artificial intelligence industry. The article suggests that individual investors should consider allocating up to 10% of their portfolio to individual AI stocks, as part of a diversified investment strategy, to benefit from the growth potential of artificial intelligence while managing the higher risk associated with this rapidly evolving sector.
Also read: 5StarsStocks AI: Powerful Stock Picks Powered by AI.
Cloud Computing Giants
Key Cloud Computing Players
Several cloud computing giants are making strides in the artificial intelligence space, leveraging their vast resources and cloud infrastructure. Here are some notable companies and their recent performance:
| Company | Price | Market Cap | Key Metrics |
|---|---|---|---|
| Cloud Consensus Solutions (CCSI) | $12.50 | $0.240B | 12-month trailing P/E ratio: 3.11 |
| JOYY Inc. ADR (YY) | $33.37 | $2.03B | 12-month trailing P/E ratio: 6.97 |
| Opera Ltd. (OPRA) | $14.49 | $1.27B | 12-month trailing P/E ratio: 7.61 |
These companies, while not exclusively focused on AI, are well-positioned to capitalize on the growing demand for cloud-based AI solutions and services.
- NVIDIA Corp. (NVDA) stands out with a price of $877.57, a market cap of $2.190T, an impressive EPS growth of 586.45%, and a staggering revenue growth of 265.28%.
- ServiceNow Inc. (NOW) boasts a price of $721.16, a market cap of $147.84B, an EPS growth of 378.34%, and a revenue growth of 23.33%.
- International Business Machines Corp. (IBM) had a price of $167.43, a market cap of $153.49B, an EPS growth of 352.54%, and a revenue growth of 2.45%.
These tech giants are leveraging their cloud computing capabilities to offer AI-powered solutions, positioning themselves as key players in the artificial intelligence revolution.
Software Innovators
Artificial intelligence Software Leaders
Beyond hardware and cloud services, several software companies are pioneering innovative artificial intelligence solutions across various industries. Here are some notable artificial intelligence software innovators to watch in 2024:
- Adobe Inc. (ADBE): Adobe’s AI-powered tools like Sensei and Firefly are revolutionizing creative workflows, offering advanced image generation, editing, and analysis capabilities.
- UiPath Inc. (PATH): UiPath is a leading provider of robotic process automation (RPA) software, utilizing artificial intelligence to automate repetitive tasks and streamline business operations.
- CrowdStrike Holdings Inc. (CRWD): CrowdStrike’s AI-driven cybersecurity platform offers advanced threat detection and prevention capabilities, making it a key player in the AI security space.
- Snowflake Inc. (SNOW): Snowflake’s cloud-based data platform leverages artificial intelligence to provide advanced analytics and data management solutions, enabling businesses to derive valuable insights from their data.
- Arista Networks Inc. (ANET): Arista’s AI-powered networking solutions offer intelligent monitoring, automation, and optimization capabilities for modern data centers and cloud environments.
These companies are at the forefront of developing AI-powered software solutions that cater to diverse industries, from creative tools and automation to cybersecurity and data analytics. Their innovative offerings position them as key players in the rapidly evolving artificial intelligence software landscape.
AI Software Value Picks
While high-growth artificial intelligence software companies often command premium valuations, some companies offer attractive value propositions based on their price-to-earnings (P/E) ratios:
These companies, although not exclusively focused on AI, are leveraging AI technologies to enhance their offerings and provide value to customers across various sectors.
The artificial intelligence software sector is rapidly evolving, with companies continuously pushing the boundaries of what is possible with AI-powered solutions. As the demand for AI-driven software continues to grow, these innovators are well-positioned to capitalize on the opportunities presented by this transformative technology.
Emerging Players
Top Performers
The top 7 best-performing AI stocks as of May 2024 based on the Indxx Global Robotics & Artificial Intelligence Thematic Index are:
- NVIDIA Corp (NVDA) with 183.01% 1-year performance
- Procept BioRobotics Corp (PRCT) with 88.12% 1-year performance
- Upstart Holdings Inc (UPST) with 73.31% 1-year performance
- SoundHound AI Inc (SOUN) with 66.73% 1-year performance
- AeroVironment Inc. (AVAV) with 56.91% 1-year performance
- Helix Energy Solutions Group Inc (HLX) with 48.46% 1-year performance
- Symbotic Inc (SYM) with 44.49% 1-year performance
AI Bubble Concerns
There are concerns about an ‘artificial intelligence bubble’ with some companies seeing rapid stock price increases without demonstrating real artificial intelligence capabilities. Investors should exercise caution and conduct thorough research before investing in AI stocks.
Portfolio Diversification
Investing in individual artificial intelligence stocks can be risky, but they can also be part of a diversified portfolio for financially secure investors. It is recommended to allocate no more than 10% of a portfolio to individual AI stocks.
Artificial intelligence ETFs
Investors can also gain AI exposure through ETFs that track AI-focused indexes. This approach offers diversification and potentially lower risk compared to investing in individual artificial intelligence stocks.
Value Picks
Some of the best value AI stocks include:
| Company | P/E Ratio |
|---|---|
| Cloud Consensus Solutions (CCSI) | 3.11 |
| JOYY Inc. ADR (YY) | 6.97 |
| Opera Ltd. (OPRA) | 7.61 |
These companies, although not exclusively focused on artificial intelligence, are leveraging artificial intelligence technologies to enhance their offerings and provide value to customers across various sectors.
High-Growth Stocks
Fastest-growing AI stocks include:
- NVIDIA Corp. (NVDA) with 586.45% EPS growth and 265.28% revenue growth
- ServiceNow Inc. (NOW) with 378.34% EPS growth and 23.33% revenue growth
- International Business Machines Corp. (IBM) with 352.54% EPS growth and 2.45% revenue growth
Momentum Stocks
AI stocks with the most momentum include:
- Super Micro Computer Inc. (SMCI) with 804% 12-month total return
- Applovin Corp. (APP) with 330% 12-month total return
- MicroStrategy Inc. (MSTR) with 313% 12-month total return
Advantages and Disadvantages
Advantages of artificial intelligence stocks include broad applications across industries, fast-moving innovation, and popularity with investors. However, disadvantages include industry uncertainty, rapid changes, untested companies with little history, and potential dangers of artificial intelligence technology.
Conclusion
The world of artificial intelligence is rapidly evolving, offering investors a plethora of opportunities to capitalize on this transformative technology. From semiconductor giants to emerging software players, the landscape is filled with companies driving innovation and reshaping industries. While the potential for growth is immense, investors must exercise caution and diversify their portfolios to mitigate the inherent risks associated with this dynamic sector.
Ultimately, the AI revolution is here to stay, and those who strategically position themselves in this space stand to reap the rewards. Whether through exposure to established leaders, high-growth innovators, or a balanced portfolio of AI-focused investments, the opportunities are vast for those willing to embrace the future and navigate the ever-evolving artificial intelligence landscape with prudence and foresight.
