Are you looking for some new high growth stocks to add to your portfolio? You can start with the most obvious option at the moment: artificial intelligence (AI) players.
Describing AI as a generational investment opportunity no longer sounds like hyperbole. Even without knowing what the AI industry will look like just five years from now, it's pretty clear at this point that it's going to live up to the hype. The biggest challenge now is simply figuring out which companies are best positioned to take advantage.
This brings me to three artificial intelligence stocks that have not yet been fully appreciated in light of their potential. Arguably, each of these three tickers could explode as more investors connect the dots.
1. Palantir Technologies
You've probably heard of OpenAI's ChatGPT, and you've seen this software giant. Microsoft (NASDAQ: MSFT ) It has combined its Bing search engine with AI-powered conversational assistant Copilot. You may have tinkered with or with this tool. the alphabetOf (NASDAQ: GOOG) (NASDAQ: GOOGL ) Comparable chatbot, Gemini (formerly called Bard). There is no denying that these tools are fun to play with, besides being legitimately helpful to many who use them.
From a monetization perspective though, these platforms don't seem to have a great deal of commercial appeal. ChatGPT and Copilot, however, do not represent the best use cases for artificial intelligence technology. AI platforms purpose-built for businesses are proving far more marketable.
enter Palantir Technologies (NYSE: PLTR ).
As a user, you may not have used its service. Companies love it. General MillsCBS Television Network, and Aramark It has some of the most innovative clients, though, joining a growing number of enterprises using Palantir's offerings to do something constructive with the mountains of digital data they've collected over the years. The company's software is used by the US military and intelligence agencies, as well as energy companies. ExxonMobiland drug maker Sanofi, just to name a few. No data analysis option is powerful enough to pay for…
However, Palantir Technologies has only scratched the surface of its potential. Analysts expect its top line to grow 21 percent this year and then repeat the feat next year. CEO Alex Karp's only complaint is that the company can't keep up with demand.
However, the shares are performing well. They are up over 50% for the last year and over 130% in the last few years.
However, given the company's profitability as well as the fact that it is already the market leader in its niche. Technology market research organizations Gartner And Forrester Research Both consistently rank it as one of the top names in the AI data analysis space, comparing it to big players like Microsoft and Alphabet.
2. Super microcomputer
Most everyone understands. NvidiaOf (NASDAQ: NVDA ) Hardware sits at the heart of most artificial intelligence data centers. Analysts at Mizuho Securities believe it controls about 90 percent of the AI-processor market.
Those graphics processing units (GPUs) and similarly powerful processors are just one piece of the technological puzzle that is an AI data center. Artificial intelligence servers are actually large banks of individual computers that must be built around a single processor and then strung together on a large rack (or racks). Some companies have to manufacture these computers and then assemble the towers they are part of.
That's it Super Microcomputer (NASDAQ: SMCI ) Whether a user prefers Nvidia's tech or Intelof, and whether the client wishes to use. AmazonMay provide Key Cloud Computing Service or Microsoft Key, Super Microcomputer.
And it's delivering like crazy. Last quarter's top line was up an incredible 200% year-over-year, extending a well-established growth trend that is expected to continue well into the future. Analysts are calling for a 60 percent increase in revenues in its next fiscal year.
This is just the beginning. Presidency Research predicts that the AI infrastructure market will grow at an annualized rate of more than 27% through 2033 as more and more organizations rush to build AI platforms that they increasingly realize are essential if they They will need it if they want to stay competitive.
Super Microcomputer's stock price has moved sideways after pulling back from its March peak. This is most likely before its front leg is raised, even though it is only taking a breath.
3. Alphabet
Last but not least, add the alphabet to your list of AI stocks that may go parabolic in the near future.
It's a respectable technical name, but some people may find it hard to see Google Parent as an AI play. While its Gemini/Bard chatbot is a clever use of AI tech, it doesn't have a great deal of practical trading applications. In addition, the company's core business is advertising. Adding an AI profit center to the mix can be quite a task.
However, Alphabet continues to work on this, and is better positioned to make the effort more worthwhile than you might think.
See, Alphabet isn't building an AI business from scratch with no purpose just to see what happens. It is using artificial intelligence to further improve its existing advertising business. Just last week, the company announced that it will soon allow advertisers to use AI-generated ads, for example. The company also says that ads will soon begin appearing in its new AI overview, a separate category of search results for everyone using the Google search engine. Of course, more meaningful data about Google users helps advertisers as well as Alphabet.
What could really sustain and even accelerate the stock's current advance, however, is renewed optimism from the analyst community. Bank of America Analyst Justin Post recently reiterated his buy rating on Alphabet stock, citing the latest developments in its AI advertising tech. Goldman Sachs Analyst Eric Sheridan said the same.
Both recognize that advertising is and will remain Alphabet's major earner for the foreseeable future. Its foray into artificial intelligence is complementary to, though not at odds with, this business. Investors may be underestimating the degree of earnings growth that exists here.
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Bank of America is the advertising partner of The Motley Fool Company. Suzanne Frey, an Alphabet executive, is a member of The Motley Fool's board of directors. John Mackey, former CEO of Whole Foods Market, is a member of the board of directors of The Motley Fool, an Amazon subsidiary. James Brumley has positions in alphabetical order. The Motley Fool holds and recommends positions in Alphabet, Amazon, Bank of America, Goldman Sachs Group, Microsoft, Nvidia, and Palantir Technologies. Motley Fool recommends Gartner and Intel and recommends the following options: long January 2025 $45 calls on Intel, long January 2026 $395 calls on Microsoft, short January 2026 $405 calls on Microsoft, and short May 2024 on Intel $47 calls. The Motley Fool has a Disclosure Policy.
3 Artificial Intelligence (AI) Stocks That Could Go Parabolic was originally published by The Motley Fool.