3 Artificial Intelligence Stocks You Can Buy and Hold for the Next Decade

WhatsApp Group Join Now
Telegram Group Join Now
Instagram Group Join Now

Investing in artificial intelligence (AI) has looked more challenging in the past few months. After more than a year of creative AI generating excitement for tech investors, certain stocks such as Nvidia, Super MicroAnd Crowd strike It seems to have garnered most of the interest and skyrocketing prices.

Fortunately for investors who feel they missed out on these stocks, AI will likely be more than a flash in the pan. Thus, one can buy certain AI stocks for the next decade and hold them with a reasonable expectation of making significant profits. These three stocks deliver for investors.

1. Palantir Technologies

At first glance, investors may assume they've missed out. Palantir Technologies (NYSE: PLTR ). The stock has quadrupled since its lows in late 2022. Also, recent earnings growth is unlikely to sway investors.

After all, investors have yet to fully realize the game-changing potential of its innovative AI product: the Artificial Intelligence Platform (AIP). AIP builds on the analytics capabilities of its legacy Gotham and Foundry platforms. While those platforms also relied on AI, the productivity gains reported by AIP users have yielded spectacular results.

After attending AIP bootcamps, companies seem to find multiple use cases. A potential customer purchased a hyperscaler (eg Amazon web services) may have achieved success in four months, while another claimed to be able to build 10 times faster with three times less resources. Such results seem to quickly lead to seven-figure new deals for Palantir.

As mentioned, results may take time. In the first quarter of 2024, revenue grew 21% to $634 million, which appears modest when comparing growth to a price-to-sales (P/S) ratio of 24.

Still, its net income of $106 million was more than six times the year-ago level. If revenue growth begins to reflect productivity gains and increased deal volume through AIP, stock prices should accelerate significantly over the next few years.

2. Alphabet

In addition to up-and-coming AI companies, investors may also want to look at a pioneer in the field: Google Parent the alphabet (NASDAQ: GOOGL ) (NASDAQ: GOOG). Alphabet began using the technology in 2001 and became an AI-first company in 2016, using the technology in all subsequent product releases.

However, the rise of ChatGPT gave investors the impression that Alphabet was lagging behind its peers. For the first time in decades, Google's dominant search engine faced a credible competitive threat.

Before writing off Alphabet, however, investors should note that it has released its own creative AI tool in the form of Google Gemini. Additionally, Google Cloud, the third largest cloud company, ensures that it will play a key role in deploying this technology for clients.

Cloud Infrastructure Market Share, by Company, Q1 2024

Additionally, Alphabet merged its research teams to form Google DeepMind in April 2023. Backing its efforts with $108 billion in liquidity, Alphabet is unlikely to lag behind in this arena.

Finally, at a price-to-earnings ratio of 28, it's cheaper than its megatech rivals. Between its breadth of experience in AI and its formidable resource base, the Google parent will likely remain a force in the AI ​​industry for a long time to come.

3. VanEck Semiconductor ETF

Investors who prefer not to risk valuable capital on the fortunes of a particular company may simply want to invest in most top-chip stocks. VanEck Semiconductor ETF (NASDAQ: SMH ). Most companies within an exchange-traded fund (ETF) either design or manufacture AI-ready chips. Without this technology, AI would not be possible.

This ETF invests about 20% of its assets in Nvidia, with an additional 13% in the leading chip maker. Taiwan Semiconductor Manufacturing. Its remaining holdings make up less than 10% of each fund. Broadcom, Advanced Micro DevicesAnd Micron Includes 26 stocks held.

Additionally, it reported a return of 28 percent annually over the past 10 years. In comparison, the benchmark SPDR S&P 500 reported an average annual return of 13% over the same period – less than half the return of the VanEck ETF.

Additionally, VanEck's ETF expense ratio is 0.35%, which is slightly lower than the average expense ratio, which is 0.37%. morning star. Thus, the fund has provided these out-sized returns at an affordable price.

In fact, the fund does not guarantee that it can match the 28% average annual return over the last 10 years. However, if someone wants outsize returns with less risk and without the work involved in finding such stocks, they will likely find both in the VanEck Semiconductor ETF.

Should you invest $1,000 in Alphabet now?

Before buying stock in Alphabet, consider this:

gave Motley Fool Stock Advisor The analysis team only indicated what they believed. 10 Best Stocks For investors to buy now… and Alphabet was not one of them. 10 stocks that made the cut could generate monster returns in the coming years.

Consider when Nvidia This list was created on April 15, 2005… If you invested $1,000 at the time of our recommendation, You will have $759,759.!*

Stock Advisor Provides investors with an easy-to-follow blueprint for success, including guidance on building a portfolio, regular updates from analysts, and two new stock picks every month. gave Stock Advisor The service is More than four times S&P 500 Returns since 2002*.

View 10 Stocks »

*Stock Advisor will return on June 24, 2024.

John Mackey, former CEO of Whole Foods Market, is a member of the board of directors of The Motley Fool, an Amazon subsidiary. Suzanne Frey, an Alphabet executive, is a member of The Motley Fool's board of directors. Will Haley holds positions in Advanced Micro Devices, CrowdStrike and Palantir Technologies. The Motley Fool has positions in and recommends Advanced Micro Devices, Alphabet, Amazon, CrowdStrike, Microsoft, Nvidia, Oracle, Palantir Technologies, Salesforce, Taiwan Semiconductor Manufacturing, and Tencent. The Motley Fool recommends Alibaba Group, Broadcom, and International Business Machines and recommends the following options: long January 2026 $395 calls on Microsoft and short January 2026 $405 calls on Microsoft. The Motley Fool has a Disclosure Policy.

3 Artificial Intelligence Stocks You Can Buy and Hold for the Next Decade was originally published by The Motley Fool.

WhatsApp Group Join Now
Telegram Group Join Now
Instagram Group Join Now

Leave a Comment