3 No-Brainer Artificial Intelligence (AI) Stocks to Buy With $500 Right Now
Saturday, Nov 16, 2024 6:23 am ET
3min read Artificial Intelligence (AI) has emerged as a transformative force in the tech industry, and investing in AI stocks can be a lucrative strategy. With a $500 investment, you can tap into the potential of AI by considering these three no-brainer AI stocks. Let's delve into the AI exposure, specific applications, earnings growth prospects, and long-term positioning of these stocks.
1. **NVIDIA (NVDA)**: NVIDIA is a market leader in AI, providing the hardware backbone for AI applications. Its graphics processing units (GPUs) power AI models, with a dominant share of the AI GPU market. In its fiscal first quarter, NVDA's revenue increased 262% year-over-year, led by its data center and AI chips. The company's AI-related earnings growth prospects are robust, with its data center business now making up the vast majority of its revenue. NVDA's forward price-to-earnings (P/E) ratio of 34 is more reasonable than the 59 seen during the dot-com bubble, indicating a solid foundation for sustained market performance.
2. **Alphabet (GOOGL, GOOG)**: Alphabet, the parent company of Google, has been investing heavily in AI. Its DeepMind subsidiary has made significant breakthroughs in AI research, and Google's AI efforts are integrated into various products and services, driving growth and innovation. AI services contributed eight percentage points of Azure cloud services' 29% revenue growth in its most recent quarter. GOOGL's forward P/E ratio of 32.7 is also more reasonable than the dot-com bubble, suggesting a solid long-term outlook.
3. **Microsoft (MSFT)**: Microsoft has invested $13 billion in OpenAI and has integrated ChatGPT into its Bing search engine. MSFT has also integrated all its AI copilots into a single AI experience called Microsoft Copilot. AI services contributed eight percentage points of Azure cloud services' 29% revenue growth in its most recent quarter. MSFT's forward P/E ratio of 30.9 is more reasonable than the dot-com bubble, indicating a solid foundation for sustained market performance.
In conclusion, NVIDIA (NVDA), Alphabet (GOOGL), and Microsoft (MSFT) offer attractive AI-related earnings growth prospects and are well-positioned to capitalize on the AI revolution. Their forward P/E ratios suggest more reasonable valuations than the dot-com bubble, indicating a solid foundation for long-term growth. Investors with $500 to allocate should consider these three no-brainer AI stocks as compelling additions to their portfolios.
1. **NVIDIA (NVDA)**: NVIDIA is a market leader in AI, providing the hardware backbone for AI applications. Its graphics processing units (GPUs) power AI models, with a dominant share of the AI GPU market. In its fiscal first quarter, NVDA's revenue increased 262% year-over-year, led by its data center and AI chips. The company's AI-related earnings growth prospects are robust, with its data center business now making up the vast majority of its revenue. NVDA's forward price-to-earnings (P/E) ratio of 34 is more reasonable than the 59 seen during the dot-com bubble, indicating a solid foundation for sustained market performance.
2. **Alphabet (GOOGL, GOOG)**: Alphabet, the parent company of Google, has been investing heavily in AI. Its DeepMind subsidiary has made significant breakthroughs in AI research, and Google's AI efforts are integrated into various products and services, driving growth and innovation. AI services contributed eight percentage points of Azure cloud services' 29% revenue growth in its most recent quarter. GOOGL's forward P/E ratio of 32.7 is also more reasonable than the dot-com bubble, suggesting a solid long-term outlook.
3. **Microsoft (MSFT)**: Microsoft has invested $13 billion in OpenAI and has integrated ChatGPT into its Bing search engine. MSFT has also integrated all its AI copilots into a single AI experience called Microsoft Copilot. AI services contributed eight percentage points of Azure cloud services' 29% revenue growth in its most recent quarter. MSFT's forward P/E ratio of 30.9 is more reasonable than the dot-com bubble, indicating a solid foundation for sustained market performance.
In conclusion, NVIDIA (NVDA), Alphabet (GOOGL), and Microsoft (MSFT) offer attractive AI-related earnings growth prospects and are well-positioned to capitalize on the AI revolution. Their forward P/E ratios suggest more reasonable valuations than the dot-com bubble, indicating a solid foundation for long-term growth. Investors with $500 to allocate should consider these three no-brainer AI stocks as compelling additions to their portfolios.
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