AI Alchemists: 3 Stocks Transforming Data into Gold
Data is big business. Consumers can look at data to make decisions about their finances, fitness routines, and any other part of their lives. Corporations also assess data to determine which actions to take and the best opportunities to pursue. While data can lead to new business discoveries and personal breakthroughs, there’s also a lot of money to be made in creating, storing, and protecting data. One of the tools that has been making waves in data protection is artificial intelligence. As such, AI stocks have gotten a lot of attention.
These AI stocks have the potential to gain considerable value as more people embrace the new technology.
Nvidia (NVDA)
Nvidia (NASDAQ:NVDA) has been a leader in the AI industry for multiple years. Earnings reports from this company are big market events that have the power to dictate what happens within the next few weeks.
The AI giant once again delivered superb earnings in the first quarter of fiscal 2025. Revenue soared by 262% year-over-year and 18% sequentially. Net income grew by 628% year-over-year and was up by 21% sequentially.
Nvidia’s AI chips continue to generate plenty of demand, but the company’s expansion into cloud computing can create additional opportunities. The stock has more than doubled year-to-date and is charging toward a $3 trillion market cap.
Nvidia has a real shot at becoming the world’s most valuable publicly traded corporation. Wall Street analysts seem to be on board and have rated the stock as a Strong Buy. The average price target suggests that the stock can gain an additional 9% from current levels.
Alphabet (GOOG, GOOGL)
Alphabet (NASDAQ:GOOG, NASDAQ:GOOGL) has been using artificial intelligence for many years to present users with relevant search results. The company’s use of AI has resulted in high ad conversion rates and billions of dollars in quarterly revenue.
The advertising giant reported 15% year-over-year revenue growth in Q1 2024. Net income was up by 57% year-over-year. Alphabet’s profit margin soared to 29.4% in the quarter. While advertising revenue continues to make up the bulk of total revenue, Google Cloud is a notable segment that now makes up more than 10% of total revenue.
Alphabet’s new Gemini AI model can lead to more revenue opportunities. While this language learning model had some hiccups at the start of 2024, those setbacks have been largely forgotten amid strong earnings and the company’s first dividend. Shares are up by 25% year-to-date and have gained 226% over the past five years. The stock trades at a 27 P/E ratio.
Crowdstrike (CRWD)
As more companies use artificial intelligence, more data will proliferate the web. This extra data can give companies more capabilities, but data points also have to be protected. Hackers can make a lucrative living stealing data and sensitive information, and some of them are using AI tools to hack at scale.
Crowdstrike (NASDAQ:CRWD) is a leading cybersecurity platform that keeps cybercriminals away from critical data. It’s delivered exceptional shares for long-term investors. The stock has gained 27% year-to-date and is up by 389% over the past five years.
The cybersecurity firm generates most of its revenue from recurring subscriptions. Crowdstrike’s annual recurring revenue reached $3.44 billion in Q4 FY24 which is a 34% year-over-year improvement. Crowdstrike has also become more profitable over the years. Q4 FY24 net income came in at $53.7 million compared to a net loss of $47.5 million in the same period last year.
Crowdstrike is currently rated as a “Strong Buy’ with a projected 28% upside based on the average price target. Make the right play and grab these AI stocks today.
On this date of publication, Marc Guberti held long positions in NVDA, GOOG, and CRWD. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.com Publishing Guidelines.
