In the current market scenario, one sector that is expected to make significant gains in the coming years is the high-tech sector. Powered by artificial intelligence (A.I.), the tech sector is booming, with tech stocks hitting new highs in the past few months. There is immense potential in this industry. goldman sachs (New York Stock Exchange:G.S.), AI-related investments are expected to reach $200 billion globally by 2025. As AI adoption increases and penetrates multiple industries, we will see companies reporting impressive numbers. And now is the time to pay attention to buying AI stocks.
Companies that don't adopt or invest in AI could end up losing a lot of business.success of Nvidia (NASDAQ:NVDA) has proven the impact of AI in our world and is currently the winner of the AI race. But there is still a long way to go, and several companies are investing in AI to make the most of the hype. If you missed your chance to buy NVDA stock, here are his top 7 AI stocks to buy if you want to make the most of the AI craze.
AI Stock to Buy: Microsoft (MSFT)
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The biggest beneficiaries of the AI revolution will be microsoft (NASDAQ:MSFT) is enjoying the first mover advantage of having invested in OpenAI We have integrated AI into our products and services. We're taking a comprehensive approach to integrating AI into all of our services, enabling us to drive revenue and growth for years to come.
The company has already found success in the cloud and is looking to monetize it through Microsoft Copilot. Adopting a subscription model, the company's number of subscribers has increased significantly, exceeding 1 million in October 2023. This will lead to an increase in the company's revenue.
I'm confident the company's quarterly results will be great, and if you only want to own one tech stock, it has to be Microsoft. Up 14% year-to-date (year-to-date), MSFT stock will continue to rise steadily, and that could lead to a rally. The stock also pays a dividend and has a modest yield of 0.70%.
Oracle (ORCL)
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oracle (New York Stock Exchange:ORCL) has been making big moves recently and continues to aggressively expand. The company is building its 100 data centers and launching the Oracle Cloud Infrastructure platform to provide cloud services to other companies.The company recently signed agreements with Palantir (New York Stock Exchange:PLTR) Combine AI abilities.
This partnership could be a game-changer and improve growth prospects for both companies. It also has a deal with Nvidia, in which the two companies will sell cloud products, AI chips and software. These trades show Oracle's strength to beat the market. The company also reported strong third-quarter results, up 7% year-over-year (YOY).
Oracle's backlog also increased 29% year over year. Currently trading at $123, the stock is up 18% year-to-date and 31% for the year. As an established industry player, Oracle has everything you need to succeed in the thriving AI space.
Taiwan Semiconductor Manufacturing (TSM)
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One of the most popular technology companies right now, taiwan semiconductor manufacturing (New York Stock Exchange:TSM) plays an important role in the expansion of the AI industry. TSM is also a very important industry player for Nvidia, as it manufactures most of the Nvidia-designed chips and chips needed to run its AI technology.
The company recently won $6.6 billion in government funding for chip production. The move is aimed at increasing the company's manufacturing capacity in the U.S., with the company increasing its investment in Arizona by $25 billion to $65 billion and adding a third factory in the state by 2030. It's planned.
The future is bright for TSMC, with the stock already up 44% year-to-date. The company also reported its fastest monthly revenue growth since 2022, with sales reaching $6.1 billion in the month, up 34% year-over-year.
Super microcomputer (SMCI)
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Soaring higher than Nvidia, super microcomputer (NASDAQ:SMCI) is up 235% year-to-date and 785% for the year. Currently trading at $937, the stock may seem expensive, but it's worth the money. SMCI, which is directly related to Nvidia, grows whenever Nvidia grows. It integrates his Nvidia processor with the motherboard design and is one of the best at the moment.
SMCI relies heavily on Nvidia, but I believe they have one of the best liquid cooling products in the industry and have early access to Nvidia's chips. AI servers require proper cooling servers, and that's where super microcomputers will benefit. The company is considering expanding production, which will lead to financial improvement.
In the fourth quarter, the company reported impressive financials with net sales reaching $3.66 billion and EPS increasing 62% to $5.10 per share. Analysts have set a high price target for the stock, and the company must meet those expectations.
AI stocks to buy: Alphabet (GOOGL, GOOG)
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meanwhile alphabet (NASDAQ:GoogleNasdaq:google) isn't making as much noise as other companies in the AI industry, but it's still going strong. The company is working on developing affordable AI chips and still has a strong position in Google Search and Google Cloud. These are the two most revenue-generating segments for the company and contribute to the growth of the business.
One of the big reasons to invest in Alphabet is the company's innovative potential. The company is working on a new Arm-based AI CPU that could be a game-changer for businesses. Alphabet is a very stable company with a rich history, and its solid market share makes it one of the best tech stocks to own.
The stock is up 15% year-to-date and currently trades at $160. It looks very undervalued to me, with analysts saying it could reach $185 soon. oppenheimer Analysts set a price target of $185.
Advanced Micro Devices (AMD)
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Nvidia's biggest competitor Advanced Micro Devices (NASDAQ:AMD) is slowly growing its AI products. It is ready to take on Nvidia with the launch of a series of microchips designed for AI applications.
The company has released the microchip “MI300X” used in servers and data centers. Several top technology companies are buying these chips, including Microsoft. AMD stock is up 18% year-to-date, trading at $170. It's up 80% this year and could soon reach $200.
If you think Nvidia is too expensive, it's time to get AMD before the price goes up. The market is very optimistic about AMD's future as it is considered the underdog in the industry. The company expects sales of $5.4 billion in the first quarter and believes it will report strong fundamentals. AMD has a strong track record in the industry, and a drop in stock price is a buying opportunity.
Palantir Technologies (PLTR)
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Palantir Technologies has dominated the market with its AI prowess. Up 35% year-to-date, the stock is trading at $22 and rising. The stock price has soared since February after the company posted impressive numbers with its artificial intelligence platform (AIP) Bootcamp.
The company is taking full advantage of the growing demand for the cloud and integrating AI into its products. It closed 103 deals worth at least $1 million in the fourth quarter and also has a backlog of boot camps. Palantir saw commercial revenue increase 70% year-over-year in the quarter, and consumer numbers grew 55%.
As mentioned earlier, Palantir's partnership with Oracle will benefit businesses as their applications will be available through Oracle's cloud infrastructure. I've written about Palantir before and believe he has the potential to double your money. Considering the high demand for AI in the industry, Palantir will have an exceptional year in his 2024.
On the date of publication, Vandita Jadeja did not have (directly or indirectly) any positions in the securities mentioned in this article. The opinions expressed in this article are those of the writer and are influenced by InvestorPlace.com. Publication guidelines.
