AI stocks remain a dominant force in the stock market, leading the way through all of 2024. Is this lucrative niche finally starting to cool off? I investigate AI’s potential for the future and share five AI stocks still worth buying this year.
Are AI Stocks Still Worth Investing In?
Artificial intelligence (AI) has proven itself to be a game-changing technology in the past few years, invading nearly every industry and sector in at least some capacity.
Individuals who jumped on the right bandwagon early enough were treated to some massive gains as companies like Nvidia rose to prominence in the space.
We’ve already borne witness to some of the breakthroughs this technology has been able to accomplish in such a short time through lenses like ChatGPT, self-driving automobiles, and advances in medicine.
Despite AI now living in the spotlight, many experts believe we still have a long way to go before AI saturates the market entirely.
Wall Street titan Mark Chaikin is so excited about AI’s potential that he’s dedicated much of his recent research to the industry in his Power Gauge Report, where he includes a short list of his top AI power picks both now and down the line.
As in any sector, not every artificial intelligence stock will lead to massive returns. Carefully suss out the best options, and only invest what you can afford to lose.
I took the time to compile five of my favorite AI stocks right now that you can consider adding to your own portfolio. Let’s dive into those now.
Top 5 AI Stocks To Buy in 2024
Without further ado, here are my top five AI stocks for 2024:
Nvidia Corp (NASDAQ: NVDA)
Nvidia is currently the undisputed leader of the artificial intelligence boom, and its financial growth is solid proof.
Founded more than 30 years ago, the company began with an ambitious goal of bringing 3D graphics to the gaming and multimedia markets.
After becoming a success in the graphics industry, Nvidia began its foray into AI over ten years ago and hasn’t looked back.
Both its graphics processing units (GPUs) and AI initiatives earned Nvidia a spot on this list, and the company remains at the forefront of each technology even today.
NVDA stock is up more than 2,500% over the last five years, catapulting it into the infamous tech Magnificent Seven.
With a $3.3 trillion market cap, it’s now also one of the largest companies in the world.
It doesn’t seem like Nvidia’s day in the sun is over yet, likely continuing its rise along with anyone who can afford the steepening cost of investing in shares.
Meta Platforms Inc (NASDAQ: META)
Another Magnificent Seven stock, Meta Platforms is pursuing AI in an entirely different way.
A champion for the Metaverse, CEO Mark Zuckerberg plans to tie AI into user experiences in social media, news feeds, and through virtual reality interactions.
The approach makes sense, considering Meta owns Facebook, Instagram, Threads, and WhatsApp, where individuals communicate and share digitally. Meta also controls the Quest and Horizon Worlds, pioneers in augmented and virtual reality.
Billions of people tap into at least one of these sources every day.
Although the company struggled with its direction in the early part of the decade, it rebounded and then some from the onset of 2023.
Shares are up considerably in 2024 alone as Meta continues to surpass revenue and earnings estimates.
The company’s focused push to a $600 share price feels more evident than ever, and it’s likely that AI will be a large part of that charge.
SoundHound AI Inc (NASDAQ: SOUN)
Several companies attached AI to their names at the start of the AI craze, some without the intent of ever actually entering the field.
SoundHound AI embraces AI at its core, offering proprietary technology in the art of voice recognition.
Its goal is to connect people to brands through custom interactions businesse
s can use to better engage their customer base.
These unique products could allow clients to interactively receive answers to questions, place orders, or transcribe dialogues with utmost accuracy.
In turn, ventures can capture analytics from exchanges with AI that help improve focus and ultimately allow an even better experience the next time around.
As a leader in AI-based voice recognition technology, SoundHound AI has already carved out a niche for itself that few can rival.
Recent acquisitions add to the company’s reach, potentially allowing it to add even more clients to a list already featuring White Castle, Stellantis, Qualcomm, and more.
Intuitive Surgical Inc (NASDAQ: ISRG)
Intuitive Surgical is home to a host of tools designed to promote minimally invasive care for patients around the world.
Its best-known offering is the Da Vinci surgical system, built from nearly three decades of company experience combining robotic tech with advanced software.
More than 8,600 surgical systems are in use today and have performed more than 14 milli
on surgeries in 71 countries since 2022.
The Da Vinci 5, Intuitive’s newest and most integrated platform to date, utilizes even more real-time data from artificial intelligence to drive positive surgical outcomes.
These machine-learning tools will continue to evolve and improve over time as more data is added to each system.
Intuitive Surgical is undoubtedly seeing the fruits of its labors, recently climbing above a $180 billion market cap.
Shares of ISRG currently sit at an all-time high, in no small part due to the company’s insistence on AI.
Arista Networks Inc (NYSE: ANET)
Last on our list, Arista Networks leads the way in cloud networking and data centers.
The company set out in 2004 to revolutionize high-speed Ethernet on a massive scale, building switching platforms to maximize data center performance and efficiency.
After going public in 2014, Arista branched into cloud computing as well to boost network performance and scalability.
Its technologies have received a number of awards over the years, unsurprisingly helping ANET take on more than 10,000 unique customers while deploying over 100 million ports.
Many of its newest processes align with AI to provide real-time updates and generative improvements specific to each client.
Arista started its share price rise a bit later than other companies on its list, potentially offering an e
ven longer runway for gains.
You’ll need to get past the roughly $400 valuation, but there’s no telling how high the Arista can go.
Are We in an AI Bubble?
Many of us remember the dot-com bubble burst at the turn of the millennium.
The tech stocks of that era rose so quickly, ultimately popping in a horrific downward spiral that sent a lot of people into financial turmoil.
Fears are arising about artificial intelligence ballooning to that same level, just waiting for the needle to bring it all crashing down.
While it’s true that AI saw a similar rapid rise, it simply doesn’t seem like the industry is any
where near its peak. The potential runway still ahead of AI appears to indicate there’s no bubble for the time bring.
That said, the stock market is a cruel mistress. Mark Chaikin’s report includes alerts dedicated to market trends that could signal a bubble and the potential implications of a downturn on the horizon.
How to Invest in AI Stocks
Investing in AI stocks is no more difficult than any other type of security on the stock market.
If you’re brand new, the first step is to open up a brokerage account with the platform of your choosing.
Next, you’ll need to weigh the risks of artificial intelligence and how much you want to incorporate into your portfolio.
This specific niche comes with the potential for massive gains, but most well-established companies already trade for hundreds of dollars.
Less mainstream ventures often trade for at a lower cost but may or may not have the innovative technology to make a name for themselves in a very competitive environment.
Making educated assessments could spell the difference between success and failure, and finding the right AI stocks is even more dependent on research.
Many experts take much of the guesswork away. One of my favorites is Marc Chaikin, who even shares stocks best avoided to better your chances of coming out on top.
Final Thoughts
Artificial intelligence stocks can certainly make a positive impact on your portfolio as long as you can navigate the pitfalls along the way.
Always take the time to do your own research before making any sort of investment, so you have confidence in each selection.
That said, I believe any of the picks in this article are an excellent starting point for the next step of your AI journey.
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