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The AI Stocks Poised to Join the Trillion-Dollar Club
2024-07-28 19:55:08
Artificial Intelligence
Stocks
Technology

The AI Stocks Poised to Join the Trillion-Dollar Club

Alphabet and Nvidia are two AI growth stocks that have the potential to become trillion-dollar companies. Despite Alphabet's lower valuation compared to Microsoft, it is expected to grow earnings per share at a faster rate.

If Alphabet meets these expectations, it could reach a $3 trillion valuation by 2025. Similarly, Nvidia's current valuation seems reasonable given its expected annual earnings growth. It could also become a trillion-dollar company by 2026. The Motley Fool's Stock Advisor service has had a strong track record of identifying stocks with high returns, including Nvidia.

In addition to Alphabet and Nvidia, other companies like Microsoft, Amazon, and AMD are also making significant inroads in the AI industry. However, investors should be cautious as stocks like Nvidia have experienced corrections in the past.

Overall, the AI revolution presents opportunities for investors to profit from the growth of these companies.

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The Impact of AI on Stock Market Giants

Microsoft's AI investments, including a $10 billion stake in OpenAI, have positioned it as a dominant player in the tech industry. With the integration of ChatGPT and the launch of CoPilot, Microsoft's cloud business, Azure, has experienced significant growth. Despite its high valuation, Microsoft remains a compelling long-term investment. Qualcomm, on the other hand, is set to benefit from the rise in AI-enabled smartphone shipments, but has not been identified as one of the best stocks to buy now. C3.ai, an AI enterprise software platform, has seen growth but faces skepticism due to unsustainable losses. Additionally, the environmental impact of AI dominance is becoming a concern, with data centers consuming significant amounts of electricity and contributing to greenhouse gas emissions. OpenAI's new prototype, SearchGPT, poses a threat to Google's search market dominance.

Navigating the Risks and Rewards of the AI Trade

The AI trade is under scrutiny as Morgan Stanley's CIO raises concerns about its impact on revenues. While Nvidia hits a $3 trillion market cap, Salesforce and ServiceNow face slower AI adoption rates. Goldman Sachs highlights lesser-known AI opportunities. Elon Musk seeks input on funding xAI amid Tesla's challenges. The environmental cost of AI's dominance is evident, with GPT-3 creation consuming vast energy and generating substantial CO2. Investors are advised to consider a diversified sector-based investment approach amidst the AI hype transition towards practical industry applications. Nvidia's stock performance remains strong, with optimistic analyst projections, underlining the company's pivotal role in the AI sector.

Read 12 more recent news on this topic

The press radar on this topic:

The Street
28. Juli 2024 um 11:46

Analysts revamp Google parent stock price target into Q2 earnings TheStreet Daily Newsletter

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Alphabet shares dipped despite bullish analyst note ahead of Q2 earnings. Google parent added $520B in market value on AI, search dominance. Analysts see $197B in search revenue this year, $217B by 2025, boosted by AI chatbot Gemini. YouTube revenue expected to reach $37B in 2024, $43B in 2025. Google Cloud to grow 28%, boosted by generative AI. Alphabet plans $70B buyback, first-ever dividend after strong Q1. Biden administration set Jan 19 deadline for TikTok parent ByteDance to divest U.S...
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28. Juli 2024 um 08:06

Nvidia Stock Correction: 25 Years of History Offers Its Take on How Far the Leading Artificial Intelligence (AI) Company Might Plummet

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Nvidia, the leading AI company, has seen its stock surge over 600% since 2023 due to its dominance in the GPU market for data centers and the rise of AI. The company's pricing power, competitive edge in compute capabilities, and well-established sales channels have been key drivers of its growth. However, the stock has recently entered a correction, and history suggests it could plummet by at least 50% from its peak, potentially even below a $1 trillion market cap, as market-leading stocks tend..
Yahoo Finance
28. Juli 2024 um 08:44

2 Monster AI Growth Stocks to Buy Before They Join Microsoft and Apple as $3 Trillion Companies

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Despite Alphabet's lower valuation (24x earnings) compared to Microsoft (37x earnings), Wall Street expects Alphabet to grow earnings per share at a faster rate (17% vs. 14%). If Alphabet meets these expectations and is afforded the same valuation as Microsoft, it could become a $4 trillion company by 2025, making a $3 trillion valuation easily achievable. Similarly, Nvidia's current valuation of 66x earnings seems reasonable given its expected 34% annual earnings growth, potentially making it..
Yahoo Finance
28. Juli 2024 um 09:07

Nvidia Stock Could Surge (Another) 259% by 2030. This Artificial Intelligence (AI) Stock Could Soar Even Higher, According to 1 Wall Street Analyst.

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Nvidia's consistent R&D focus has kept it ahead of the competition in performance; AMD's processors are comparable to Nvidia's but cost considerably less, providing a pricing advantage as AI adoption accelerates; The Motley Fool's Stock Advisor team has a strong track record, but they did not recommend Nvidia, suggesting investors consider AMD as another way to profit from the AI revolution.
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