One thing Wall Street can always guarantee is a new investment trend to capture investors’ attention. Right now, the trend getting the most hype is artificial intelligence (AI).
AI involves using software and systems to perform tasks traditionally done by humans. The secret to AI is machine learning, allowing systems to learn and improve their performance over time.
PwC researchers estimate that AI could contribute $15.7 trillion to the global economy by 2030, a figure that investors can’t ignore.
Look beyond Nvidia for better AI stock options
While many tech companies are diving into AI, the standout player is semiconductor company Nvidia (NASDAQ: NVDA). Nvidia’s GPUs are crucial for AI-driven data centers, enabling quick decision-making.
Despite strong data-center revenue growth, Nvidia faces challenges. Competition is increasing with players like Advanced Micro Devices and Intel entering the market, potentially eroding Nvidia’s market share.
Concerns about GPU scarcity and export restrictions to China also pose risks for Nvidia’s future, making its valuation in fiscal 2024 relatively high.
Instead, consider two other AI stocks with better value propositions.
Meta Platforms
Social media giant Meta Platforms (NASDAQ: META) offers a more cost-effective investment compared to Nvidia. Meta’s AI applications, like chatbots and ad optimization, complement its flagship social media platforms.
Meta possesses strong financials, a robust user base, and diversified revenue streams, making it a solid AI investment at a reasonable valuation.
Consider investing in Meta for long-term growth potential and value.
Alibaba
China’s e-commerce leader, Alibaba (NYSE: BABA), is another attractive AI stock. Leveraging AI for cloud services and market-leading e-commerce platforms, Alibaba is poised for sustainable growth.
Alibaba’s innovative AI applications and strong financial position make it an appealing investment opportunity.
Investing in Alibaba offers exposure to China’s rebounding economy and its expanding middle class, presenting significant growth potential.
Considering Alibaba’s strong fundamentals and low valuation, it is a compelling option for long-term investors.
Before investing in Meta Platforms, review the Motley Fool Stock Advisor’s top stock picks for potential high returns. Learn more about Meta Platforms and other top-performing stocks.
Invest wisely and align your investment choices with long-term financial goals.
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