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A.I. "Gold Rush": Focus on 3 Stocks Selling the "Picks"
The AI Arms Race
OpenAI and Microsoft’s AI “Chatbot” ChatGPT shocked the world in late 2022 with its capability, speed, and user growth. Less than a week after launching, ChatGPT reached a billion users, reaching the milestone well before previous consumer application record holders like Instagram (took more than two months) and Netflix (took 3.5 years). A few months after ChatGPT went mainstream, Googlelaunched its Chatbot named Bard.
Competition Heating up
Like the internet boom of the late 1990s, innovators nationwide are beginning to understand how transformative and potentially profitable the technology can be. Today, we know that Google beat out Yahoo! and others in the search engine wars. However, before these juggernauts became dominant in their respective spaces, it was unclear who would win out of the thousands of competitors who ultimately made it. While ChatGPT is the early leader, the race has just begun. Despite the tough competition, the rewards are perceived to be enough such that innovators worldwide are racing for AI supremacy.
Why Search for “Gold” When you can Sell the “Picks”?
Investors looking to cash in on the AI revolution have two choices: bet on a company they think can win the AI race, or bet on the companies that are necessary to run AI. In my mind, the odds favor the latter. Below are 3 such companies that are buyable now:
Semiconductors Will Power AI
Zacks Rank #1 (Strong Buy) stock Nvidia is the obvious choice. Nvidia is the market leader in high-performance semiconductors used in artificial intelligence, computing, and accelerated computing.
4 Billion Reasons to Buy
Last quarter, Nvidia shocked Wall Street by upping quarterly revenue guidance to $11 billion after announcing revenue of $7 billion. Wall Street is catching up – for the current year, Zacks Consensus Estimates suggest NVDA will grow eps at a cool 133.23%
Global Adoption
What analysts may not foresee is the global adoption taking place. China’s internet giants want to buy $5 billion worth of high-performance Nvidia chips used in generative AI. The buying mania comes as tensions between the US and China hit a fever pitch.
Quantum Computing Will Lead to Cost Savings
Ionq is the only pure-play publicly traded quantum computing stock. The company’s website says, “The dawn of the quantum age is here. IonQ is developing quantum computers designed to solve the world’s most complex problems and transform business, societies, and the planet for the better.”
AI Isn’t Cheap
Did you know it costs about $100 thousand daily to run ChatGPT? Meanwhile, Google’s Bard Chatbot costs about ten times more than a standard Google keyword search. As AI grows in popularity, these costs will only increase. Quantum computing companies like IonQ are a potential solution. IonQ can help companies like Google run the large language models (LLMs) necessary for generative AI at a fraction of the cost.
Investors are noticing the potential. Year-to-date, IonQ shares are up 348%. However, in the past few weeks, the stock has finally retreated to the 50-day moving average, offering investors another chance to get on board.
IonQ is just getting started. Like anything in economics, supply and demand forces are critical for determining future prices. Because IonQ has a tiny share float (# of shares available for trading by the public) of ~159 million shares, continued positive news may send shares even higher.
AI Will Drive Cloud & Database Growth
Zacks Rank #2 (Buy) Stock Oracle is one of the largest enterprise-grade database, middleware, and application software providers. In recent years, Oracle has expanded its cloud computing operations dramatically. The company offers cloud solutions and services that are used to build and manage various cloud deployment models. Oracle also entered the hardware business after acquiring Sun Microsystems several years ago.
Benefitting from the AI Revolution
Oracle is likely to continue to grow rapidly due to the AI revolution. The company offers AI-driven solutions and tools to help businesses integrate machine learning, natural language processing, and predictive analytics into their applications and processes – something almost every big tech company is rushing to do.
13F Shows Smart Money is Entering the Stock
Legendary investor Stanley Druckenmiller has famously never had a down year in more than 30 years of investing. Druckenmiller’s 13F disclosure shows that ORCL is a new buy for him.
Steady Mover
Despite Oracle’s massive size, it is talked about less than stocks such as Microsoft and Amazon.Oracle is not as “sexy” as these companies; however, it produces a ton of revenue and is a dominant player in its space. Furthermore, though Oracle has a beta of just 1 (the same volatility as the S&P 500 Index), it has outperformed 92% of stocks. Low volatility and high returns are an investor's dream.
Technical Breakout
Oracle is breaking out of a classic bull wedge today. Furthermore, while the Nasdaq is deep in the red, ORCL is green and is exhibiting relative strength – a bullish sign.
Why Haven’t You Looked at Zacks' Top Stocks?
Since 2000, our top stock-picking strategies have blown away the S&P's +6.2 average gain per year. Amazingly, they soared with average gains of +46.4%, +49.5% and +55.2% per year. Today you can access their live picks without cost or obligation.
Past performance is no guarantee of future results. Inherent in any investment is the potential for loss. This material is being provided for informational purposes only and nothing herein constitutes investment, legal, accounting or tax advice, or a recommendation to buy, sell or hold a security. No recommendation or advice is being given as to whether any investment is suitable for a particular investor. It should not be assumed that any investments in securities, companies, sectors or markets identified and described were or will be profitable. All information is current as of the date of herein and is subject to change without notice. Any views or opinions expressed may not reflect those of the firm as a whole. Zacks Investment Research does not engage in investment banking, market making or asset management activities of any securities. These returns are from hypothetical portfolios consisting of stocks with Zacks Rank = 1 that were rebalanced monthly with zero transaction costs. These are not the returns of actual portfolios of stocks. The S&P 500 is an unmanaged index. Visit https://www.zacks.com/performance for information about the performance numbers displayed in this press release.
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Zacks Investment Ideas feature highlights: Microsoft, Netflix, Nvidia, Ionq and Oracle
For Immediate Release
Chicago, IL – August 16, 2023 – Today, Zacks Investment Ideas feature highlights Microsoft (MSFT - Free Report) , Netflix (NFLX - Free Report) , Nvidia (NVDA - Free Report) , Ionq (IONQ - Free Report) and Oracle (ORCL - Free Report) .
A.I. "Gold Rush": Focus on 3 Stocks Selling the "Picks"
The AI Arms Race
OpenAI and Microsoft’s AI “Chatbot” ChatGPT shocked the world in late 2022 with its capability, speed, and user growth. Less than a week after launching, ChatGPT reached a billion users, reaching the milestone well before previous consumer application record holders like Instagram (took more than two months) and Netflix (took 3.5 years). A few months after ChatGPT went mainstream, Googlelaunched its Chatbot named Bard.
Competition Heating up
Like the internet boom of the late 1990s, innovators nationwide are beginning to understand how transformative and potentially profitable the technology can be. Today, we know that Google beat out Yahoo! and others in the search engine wars. However, before these juggernauts became dominant in their respective spaces, it was unclear who would win out of the thousands of competitors who ultimately made it. While ChatGPT is the early leader, the race has just begun. Despite the tough competition, the rewards are perceived to be enough such that innovators worldwide are racing for AI supremacy.
Why Search for “Gold” When you can Sell the “Picks”?
Investors looking to cash in on the AI revolution have two choices: bet on a company they think can win the AI race, or bet on the companies that are necessary to run AI. In my mind, the odds favor the latter. Below are 3 such companies that are buyable now:
Semiconductors Will Power AI
Zacks Rank #1 (Strong Buy) stock Nvidia is the obvious choice. Nvidia is the market leader in high-performance semiconductors used in artificial intelligence, computing, and accelerated computing.
4 Billion Reasons to Buy
Last quarter, Nvidia shocked Wall Street by upping quarterly revenue guidance to $11 billion after announcing revenue of $7 billion. Wall Street is catching up – for the current year, Zacks Consensus Estimates suggest NVDA will grow eps at a cool 133.23%
Global Adoption
What analysts may not foresee is the global adoption taking place. China’s internet giants want to buy $5 billion worth of high-performance Nvidia chips used in generative AI. The buying mania comes as tensions between the US and China hit a fever pitch.
Quantum Computing Will Lead to Cost Savings
Ionq is the only pure-play publicly traded quantum computing stock. The company’s website says, “The dawn of the quantum age is here. IonQ is developing quantum computers designed to solve the world’s most complex problems and transform business, societies, and the planet for the better.”
AI Isn’t Cheap
Did you know it costs about $100 thousand daily to run ChatGPT? Meanwhile, Google’s Bard Chatbot costs about ten times more than a standard Google keyword search. As AI grows in popularity, these costs will only increase. Quantum computing companies like IonQ are a potential solution. IonQ can help companies like Google run the large language models (LLMs) necessary for generative AI at a fraction of the cost.
Investors are noticing the potential. Year-to-date, IonQ shares are up 348%. However, in the past few weeks, the stock has finally retreated to the 50-day moving average, offering investors another chance to get on board.
IonQ is just getting started. Like anything in economics, supply and demand forces are critical for determining future prices. Because IonQ has a tiny share float (# of shares available for trading by the public) of ~159 million shares, continued positive news may send shares even higher.
AI Will Drive Cloud & Database Growth
Zacks Rank #2 (Buy) Stock Oracle is one of the largest enterprise-grade database, middleware, and application software providers. In recent years, Oracle has expanded its cloud computing operations dramatically. The company offers cloud solutions and services that are used to build and manage various cloud deployment models. Oracle also entered the hardware business after acquiring Sun Microsystems several years ago.
Benefitting from the AI Revolution
Oracle is likely to continue to grow rapidly due to the AI revolution. The company offers AI-driven solutions and tools to help businesses integrate machine learning, natural language processing, and predictive analytics into their applications and processes – something almost every big tech company is rushing to do.
13F Shows Smart Money is Entering the Stock
Legendary investor Stanley Druckenmiller has famously never had a down year in more than 30 years of investing. Druckenmiller’s 13F disclosure shows that ORCL is a new buy for him.
Steady Mover
Despite Oracle’s massive size, it is talked about less than stocks such as Microsoft and Amazon.Oracle is not as “sexy” as these companies; however, it produces a ton of revenue and is a dominant player in its space. Furthermore, though Oracle has a beta of just 1 (the same volatility as the S&P 500 Index), it has outperformed 92% of stocks. Low volatility and high returns are an investor's dream.
Technical Breakout
Oracle is breaking out of a classic bull wedge today. Furthermore, while the Nasdaq is deep in the red, ORCL is green and is exhibiting relative strength – a bullish sign.
Why Haven’t You Looked at Zacks' Top Stocks?
Since 2000, our top stock-picking strategies have blown away the S&P's +6.2 average gain per year. Amazingly, they soared with average gains of +46.4%, +49.5% and +55.2% per year. Today you can access their live picks without cost or obligation.
See Stocks Free >>
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Past performance is no guarantee of future results. Inherent in any investment is the potential for loss. This material is being provided for informational purposes only and nothing herein constitutes investment, legal, accounting or tax advice, or a recommendation to buy, sell or hold a security. No recommendation or advice is being given as to whether any investment is suitable for a particular investor. It should not be assumed that any investments in securities, companies, sectors or markets identified and described were or will be profitable. All information is current as of the date of herein and is subject to change without notice. Any views or opinions expressed may not reflect those of the firm as a whole. Zacks Investment Research does not engage in investment banking, market making or asset management activities of any securities. These returns are from hypothetical portfolios consisting of stocks with Zacks Rank = 1 that were rebalanced monthly with zero transaction costs. These are not the returns of actual portfolios of stocks. The S&P 500 is an unmanaged index. Visit https://www.zacks.com/performance for information about the performance numbers displayed in this press release.