Company / Analytics

Analytics, 10 September 2021

Top Artificial Intelligence Stocks to Watch

Artificial intelligence stocks are viable options for investors looking to invest in the continuously evolving tech space. The stock market is home to various AI firms that employ the technology in a vast array of industries. The use of AI is continuing to grow day by day, as AI helps organizations with computational issues.

If you are looking to invest in the AI space, you may consider some of the stocks highlighted here.

Investments in the AI space

The Bill and Melinda Gates Foundation recently signed a four-year deal with U.K.-based AI start-up, Exscientia. In the potentially $70 million deal, Exscientia aims to develop “novel antiviral pills that could be used to treat COVID-19 and stop future pandemics from spreading”. This is but one indication that is driving AI stocks higher now.

As of last week, Google-parent company Alphabet and C3.Ai are currently working together, in an industry-first partnership that looks to accelerate enterprise AI. According to C3.Ai, they will provide industry solutions, addressing “real-world challenges” in the financial services, healthcare, manufacturing, and telecommunications industries.

The market for AI and AI-focused companies continues to grow, and below are some of the top artificial intelligence stocks worth adding to your portfolio.

1. Amazon.com Inc.

Amazon is a multinational tech company that focuses on e-commerce and artificial intelligence. Through its Amazon Web Services (AWS), the company offers the broadest and deepest set of machine learning services and supporting cloud infrastructure. Amazon essentially puts machine learning in the hands of every developer, data scientist, and expert practitioner.

Amazon has collaborated with companies like T-Mobile, which has used AWS to reshape how customers relate to them.

On Thursday this week, the company announced an all-new line-up of Fire TV devices with its first-ever Amazon-built smart TVs. The Fire TV Omni Series integrates the Fire TV experience and far-field voice technology directly into the TV, providing an all-in-one entertainment device for streaming, cable TV, music, gaming, and more. The hands-free Alexa voice controls are always available whether the TV is on or off or when using an HDMI input. This would take integration to the next level when coupled with Amazon’s Prime subscription.

Amazon stock was trading at $3,485.73 at the time of writing. In late July, the company reported its second-quarter financials. Notably, net income for the quarter increased to $7.8 billion or $15.12 per diluted share. Net sales increased by 27% year-over-year to $113.1 billion in the second quarter and operating income increased to $7.7 billion compared with $5.8 billion a year earlier.

The company also announced a six-year collaboration with Ford to bring Alexa to millions of retail and commercial vehicles in North America. The deal is the industry’s broadest roll-out of the Built-in Alexa hands-free experience.

2. CrowdStrike Holdings Inc.

Following Amazon, CrowdStrike, a cybersecurity company that utilizes its Falcon platform to detect threats and stop breaches, is worth watching. In essence, its Falcon platform is the first multi-tenant, cloud-native, intelligent security solution that can protect workloads across a variety of endpoints. Boasting over 19 cloud modules on its platform via a Software-as-a-Service model that spans multiple large security markets.

CrowdStrike stock (CRWD) was trading at $ 266.87 at the time of writing. On August 31, 2021, the company reported its second-quarter financials. Diving in, it reported total revenue of $337.7 million, a 70% increase compared to a year ago.

Unsurprisingly, subscription revenue made up a huge chunk of this revenue at $315.8 million. Also, its Annual Recurring Revenue increased by 70% year-over-year and grew to $1.34 billion. The company also ended the quarter with $1.79 billion in cash and cash equivalents.

CrowdStrike continues to make massive strides on the operational front. As of yesterday, the company is now working with Medigate, an Internet-of-Thing’s security provider for the health care industry. Through the current partnership, CrowdStrike is providing its cloud-delivered endpoints and workload protection to health care delivery organizations. To highlight, this marks the industry’s first instance of a “consolidated view of threat activity and incident response” according to Medigate.

3. IBM Corporation

For the most part, IBM Corporation, is a leading name across the board in the world of tech. Whether it is existing tech or ground-breaking fields such as AI and quantum computing, IBM is innovating in the space. For a sense of scale, the company operates in over 171 countries across the globe. Given the reach and depth of IBM’s tech portfolio, it would make sense that investors are eyeing IBM stock now.

Despite its vast operations, IBM continues to find more room to grow. Firstly, the company is currently working with IntelePeer, a leading Communications Platform-as-a-Service (CPaaS) provider. Through the current partnership, IntelePeer’s Atmosphere CPaaS offering is now available on IBM’s Watson Assistant. In practice, it will help businesses bolster their AI-powered virtual assistants with voice capabilities, without the need for third-party integrations.

Daniel Hernandez, General Manager of Data and AI at IBM said, “IBM is bringing the latest innovations in natural language processing, automation and advancing responsible AI to Watson Assistant so that businesses can transform the customer experience and boost operational efficiency.”

Additionally, IBM is busy expanding its cloud-related offerings. Earlier this week, the company collaborated with Sumo Logic, a pioneering name in continuous intelligence tech. The duo announced the launch of Sumo Logic’s Continuous Intelligence Platform on the Red Hat Marketplace, an open cloud marketplace for enterprise customers.

IBM stock was trading at $137.73 at the time of writing. In mid-August, IBM Corporation reported second-quarter 2021 non-GAAP earnings of $2.33 per share, which surpassed estimates by 3.5% and increased 6.9% on a year-over-year basis. Revenues of $18.7 billion beat the estimates by 2.7%. The top line also improved 3% (as reported) on a year-over-year basis driven by strength in the company’s hybrid cloud business.

Meanwhile, total Cloud revenues were $7 billion during the quarter, up 13% year over year. Adjusting for currency and divested businesses, total cloud revenues increased 9%. The company witnessed solid uptake of cloud-based solutions and digital transformation offerings, driven by synergies from the Red Hat acquisition.

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