Affordable Artificial Intelligence Shares That Might Surprise You
In the dynamic world of technology, two giants continue to dominate the landscape: Meta Platforms and Alphabet. Both companies have made significant strides in artificial intelligence (AI) and have shown resilience in their respective growth trajectories.
Meta Platforms, the owner of Facebook, Messenger, Instagram, and WhatsApp, boasts a daily user base of approximately 3.4 billion people across its social media apps. The company has expanded its focus to include AI research and development, with the creation of its own large language model (LLM), Llama. Recently, Meta has launched a virtual assistant, which has become the world's most used, potentially leading to increased ad spending from advertisers.
As of early 2023, Meta Platforms had a market cap of approximately $700 billion USD. The Price-to-Earnings (P/E) ratio varied but was generally around 20-25, reflecting the market's perception of its growth potential relative to earnings. Despite challenges in the advertising market, Meta has demonstrated resilience in terms of revenue growth, although the pace can vary based on advertising trends and new product adoption.
Meta is heavily investing in AI and the metaverse, areas that could provide significant future growth opportunities if they materialize as expected. The company has been building capabilities in areas like generative AI and virtual reality.
On the other hand, Alphabet, the parent company of Google, is already reaping the rewards of its AI investment. The company generates most of its revenue through advertising, primarily on the Google platform, and has shown consistent growth. Alphabet's stock is considered a no-brainer AI player to buy and hold for the long term, given its AI investment and long track record of earnings growth.
As of early 2023, Alphabet had a market cap of approximately $1.5 trillion USD. The P/E ratio, like Meta, varied but was generally around 20-25, reflecting the market's confidence in its diversified growth drivers. Alphabet benefits from a diverse range of revenue sources, including Google Search, YouTube, Google Cloud, and hardware sales, which helps stabilize its growth.
Alphabet is a leader in AI research and application through its Google AI division and other subsidiaries. It has been integrating AI into various products, including Google Search and Google Cloud services. The improvements in Google Search, due to innovations like Gemini, deliver better results to users and refine the ad experience for advertisers. Alphabet also offers AI products and services through Google Cloud, contributing to double-digit revenue growth.
In the most recent quarter, Google Cloud's revenue advanced 28% to over $12 billion, driven by demand for generative AI and AI infrastructure. Alphabet also invests in long-term bet projects like Waymo for autonomous vehicles and Calico for life sciences, which could add to future growth.
In conclusion, while both companies are powerhouse players in AI and technology, their perceived "bargain" status would depend on investors' expectations of future growth versus current valuations, as well as broader market conditions. Nonetheless, the growth prospects, particularly in AI and emerging technologies, make them attractive for long-term investors despite any short-term market fluctuations.
- In the realm of AI investment, both Meta Platforms and Alphabet, with their significant strides in artificial intelligence, are poised to gain financially as they expand their AI projects, such as Meta's Llama and Google's Google AI division.
- As tech-finance giants Meta Platforms and Alphabet continue to dominate the landscape of technology, investors are considering long-term investments in these companies, particularly due to their focus on the growth areas of AI, the metaverse, and emerging technologies, which could potentially yield substantial returns in the future.
