Artificial Intelligence has changed the way people live today. We also know artificial intelligence as AI. For investors looking to invest in booming fields in the tech sector, artificial intelligence (AI) stocks are a viable play.
If you’re looking for a great way to invest in AI? You should read this article. Artificial intelligence stocks are rarer than you might think. You might know different companies working on AI technology and selling AI services. But in reality, there are few public and authentic AI stocks.
The transition of technology from one phase to the next phase has been rapid. For investors, it’s a rather slow process to analyze their portfolios. But to decide on tech-based stocks, you’ve to anticipate rather quickly yet rationally. AI stocks pave way for you to diversify your portfolio.
A leading mind in technology and AI, Elon Musk believes that AI will crush all humans at all games. The scarcity of jobs will overrun various fields. Few jobs which will be no longer in the near future include telemarking, bookkeeping clerks, receptionists, couriers, proofreaders, and many more will follow.
To sum this up for investors, it could be substantial as AI-based companies will grow bigger with time.
Therefore, we bring you the best AI stocks in 2021 with long-term potential. Let’s get going.
NVIDIA is one of the best companies in the tech space. The chip-maker is leading the sector, including CPU and GPU chips for computers, gaming devices, and even cryptocurrency miners. NVDA is well ahead in making the processors that drive AI, and is in a dominant position to grab the opportunities in the AI sector.
According to an SEC filing, the company spent almost 20% of its sales on research and development. It’s a glimpse of how Nvidia is showing that it is on the leading edge of AI innovation. The investment is paying off. In 2020, Nvidia’s AI sales grew to 40% of total sales, up from 30% from the prior year. Whereas, the AI sales in 2019 were around 13%.
Nvidia and Deep Learning
Nvidia is not only making progress in computing devices but it’s also involved in multiple forms of deep learning and machine learning. The chip-maker would influence different industries. For instance, it’s working on autonomous vehicle technology, VMWare hybrid software suites, and Volta GPU chips, which can bring AI to any industry. All these segments are linked with deep learning and machine learning that is part of AI. Moreover, it’s also booming in the data center space, which is another plus point.
We mentioned Nvidia’s AI sales in the past two years. That’s nothing. The bigger picture is yet to come. NVIDIA is still growing and hasn’t even hit its stride yet. Analysts believe that in the next decade, the company would hit 1 trillion. Currently, it has a market cap of over $560 billion.
CRWD is a cybersecurity company that uses its core platform to detect threats and stop breaches. CrowdStrike Falcon is the first multi-tenant, cloud-native, intelligent security solution capable of protecting workloads across different endpoints.
Since the pandemic began, we’ve seen companies suffer from cyber-attacks. Companies now understand that cybersecurity is a core part of their business. Everything is going digital and the security of businesses is at stake.
CrowdStrike is a prominent figure in cybersecurity, and the growing demand for cyber services puts the company at the forefront. The company owns 19 cloud modules on its platform through a Software-as-a-Service model. These cloud modules give CrowdStrike access to various large security markets.
CrowdStrike gathered a revenue of $337.7 million during the second quarter of 2021. We saw a massive jump of 70% compared to last year. As predicted, the subscription revenue made most of the total revenue at $315.8 million. The company stands in a sound position with $1.79 billion in cash and cash equivalents.
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The next AI stock to watch this year is the all-famous Alphabet, which goes with the ticker GOOGL.
Alphabet, the leading company in tech, is another AI stock to monitor this year. Google’s parent company grows on the back of Google, but it’s bigger than what we think it is.
Elon Musk is afraid of Google for what it can do in AI. Musk believes that Google’s DeepMind can unexpectedly get bigger and get out of control. As we quote Musk:
“The nature of the AI that they’re building is one that crushes all humans at all games.”
However, Musk would work his way out with Google. He said that his prime focus in AI is DeepMind. Elon Musk’s SpaceX recently collaborated with Google. Google will use SpaceX’s growing satellite internet service, Starlink, with its cloud unit.
You might guess what is DeepMind? Or have you ever heard of DeepMind? It’s the UK-based AI subsidiary of Google that was founded back in 2010. DeepMind featured on the world stage when its AlphaGo program defeated the world champion in the game of Go in 2016.
Google’s subsidiary is well ahead in AI. DeepMind’s AlphaFold system can accurately predict the shapes of proteins that can be the runway to curing diseases. That’s just a glimpse of it in the medical field. We believe AlphaFold will offer more features in various fields in the coming year.
You might know Google for its browsing, Cloud services, and various other apps. But, do you know, DeepMind is working to make those more efficient. Therefore, Alphabet stock will be a promising AI stock for the future.
DocuSign is a prominent electronic agreement provider. The AI company has over 1 million customers around the world, including Microsoft Office 365.
In 2020, the company acquired an AI firm named Seal Software. Acquiring Seal Software puts DocuSign among the top AI stocks. DocuSign has grown since its IPO in 2018.
By almost any metric, DocuSign is growing, which is a plus when one is considering investing in AI stocks.
In July 2021, the company announced its first-quarter results of the fiscal year 2022. DocuSign’s revenue for the first quarter grew by 58% to $469.1 million compared to the prior-year period. DocuSign surpassed the consensus estimates of $437.81 million. For the next quarter, the company expects revenue between $459 million to $465 million. While, for the year-end, it expects revenue between $1,953 million to $1,965 million.
DocuSign is growing, and the outlook seems perfect. The stock is also performing well. Earlier in July, Piper Sandler analyst Rob Owens raised the DocuSign price target from $300 per share to $330 per share. Rob has kept his overweight rating on DocuSign stock.
ServiceNow is the one AI stock investors might not notice. But, it’s one of the rock-solid SaaS companies that helps to automate tasks that were once done by humans. In simple words, it helps to streamline efficiency via its SaaS platform.
The company has an AI brand called predictive intelligence, which is part of its Now Intelligence enterprise software platform. Predictive Intelligence is available as an add-on to the Now Platform. This costs extra for companies to use ServiceNow’s AI platform.
According to Fortune, ServiceNow claims to have 42% of the 2,000 largest global companies among its customer base.
ServiceNow is on the right track as its user base is increasing. The CEO of ServiceNow, Bill McDermott, mentioned that they have seen strong demand as companies retool their workflows as they go digital.
The company is performing well and is in profitability. ServiceNow recently reported second-quarter results of 2021. The revenue grew 27% to $1.41 billion, beating Wall Street’s estimate of $1.36 billion. The company ended the second quarter with 1,201 customers with more than $1 million in contract value.