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3 Solid Tech Stocks to Ride on a Booming AI Market

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Over the past couple of decades, artificial intelligence (AI) has gained significantly and contributed to the robust growth of the technology sector. Currently, the importance of AI is being felt like never before thanks to the pandemic.

An increasing number of companies are now banking on AI to better their products and services. The past couple of months have been all the more crucial for AI, which saw exponential growth as an increasing number of people resorted to technology following the coronavirus outbreak.

Companies Focus on AI

Tech companies too are increasingly resorting to AI to make their presence felt during this pandemic. Understandably, these innovations will go on to assist people in the post-coronavirus era too. Moreover, the healthcare sector has also been relying on AI, which has been assisting medical staff and healthcare workers in treating COVID-19 patients.

Last week, Amazon.com, Inc. (AMZN - Free Report) launched Amazon Halo, a health and wellness band combined with a suite of AI-powered health features that can be accessed via the Halo app on Android or iOS. The e-commerce giant last month had launched shopping carts, called Amazon Dash Carts, which will track items as shoppers add them and then automatically charge them when they remove the grocery bags, allowing them to skip the checkout line.

Also, Apple, Inc.’s (AAPL - Free Report) Machine Learning Research group last week launched a new residency program inviting experts in various fields to apply their expertise to build new ML and AI-powered products and experiences.

The pandemic has compelled people to rely more on contactless shopping and delivery. AI has been a savior in these trying times by assisting in everything from shopping to contactless delivery to even helping healthcare workers, who are at risk of contaminating COVID-19 while treating patients.

AI Poised to Grow

Today, nearly 40% businesses use AI to run their daily course. According to a recent report by Data Bridge, the global AI market accounted for $16.14 billion in 2017 and is projected to reach more than $116.4 billion by 2025 at a CAGR of 37.3%. Further, the United States will likely maintain 41% growth momentum.

The AI field holds secure development prospects, inferable from which, the key players are concentrating on building an incorporated arrangement including equipment and programming. Moreover, to expand their client base, a few merchants have teamed up with wholesalers and end clients for item appropriation.

Our Choices

Salesforce.com, Inc. (CRM - Free Report) acquired Bonobo AI, a firm using automated analysis of customer phone calls, texts and chats to deliver actionable insights. This fits perfectly with Salesforce Einstein, the company's AI-powered software that uses data to identify previously unseen business patterns, deliver the hottest sales leads, predict what marketing copy will perform best, and generally optimize how businesses operate and convert. 

The company’s expected earnings growth rate for the current year is 25.1%. The Zacks Consensus Estimate for current-year earnings has improved 25.9% over the past 60 days.  The company carries a Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.

Zoom Video Communications, Inc. (ZM - Free Report) has been benefiting from the work-from-home and online learning wave. Zoom uses AI to schedule video meetings and for a host of other things such as organizing attendee details and transcripting details.

The company’s expected earnings growth rate for the current year is more than 100%. The Zacks Consensus Estimate for current-year earnings has improved 13.4% over the past 60 days.  The company carries a Zacks Rank #2 (Buy).

Facebook, Inc. (FB - Free Report) is deeply committed to ML. Automating self-teaching algorithms to improve Facebook's News Feed algorithm is central to FB's success, and using AI to screen for hate speech and fake news has never been more important to the company. 

The company’s expected earnings growth rate for the current year is 25.4%. The Zacks Consensus Estimate for current-year earnings has improved 12.1% over the past 60 days.  The company carries a Zacks Rank #2.

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