Five years ago, artificial intelligence was more of a vague idea to be achieved in the future. However, artificial intelligence stocks are booming nowadays as the future becomes a reality. Companies across many industries use artificial intelligence to improve efficiencies including telecommunications maintenance, transportation, human resources and recruiting, finance, government and hospitals, and medicine. The number of applications is endless, and researchers are even currently developing AI to develop AI, something people just a few decades ago thought was a pipe dream.

Artificial Intelligence Stocks Comparison Table

Preview

Product Name

 P/E ratio

blocks

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20.99

Twilio Logo

Image via Twilio

0.08

monitor

Image by pixabay

47.33

Baidu

Image via Baidu

17.77

laptop

Image by pixabay

N/A

facebook

Image by pixabay

N/A

tencent logo

Image via Tencent

28.16

Artificial Intelligence Stocks FAQ

1. What to Look for in Stocks

2. When Is the Best Time to Buy Stocks?

3. How Much Should I Invest in Artificial Intelligence Stocks?

4. Where Can You Buy Them?

How We Reviewed

Artificial intelligence and programming

Image by Gerd Altmann from Pixabay 

We carefully reviewed several dozen artificial intelligence stocks and analyzed them based on their financials, how the companies made money and potential risks to come up with this unbiased top 10 list of the best AI stocks to purchase this year and include in your long-term holdings for remarkable gains with minimal risk.

Overall Price Range of Artificial Intelligence Stocks

robot hand is using a calculator

Image by 849356 from Pixabay 

The best artificial intelligence stocks can range from as little as $30 to well over $1,000 per share. Do not be intimidated by higher-priced stocks or feel priced out. The stocks on our list are poised for massive gains in value, revenue, and profit. With all these things increasing, the stock price is sure to rise in time providing you with a healthy return on your investment should you choose to sell your stocks.

What We Reviewed

  • Nvidia Corporation
  • Alphabet
  • Twilio
  • Amazon.com
  • Micron Technology
  • Microsoft Corp.
  • Baidu
  • Intel Corp.
  • Facebook
  • Tencent

nvidia

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Nvidia Corporation (NVDA) has been aggressively pursuing artificial intelligence research and development since 2016. They are known for their specialized semiconductors, and their success is driven by GPUs, the cloud, self-driving cars, and gaming. The company has solid revenue, a decent market cap and a P/E ratio of 17.09 meaning people have faith in the company and its products. The price is currently hovering around $128 per share.

Pros

  • Market leader in self-driving space
  • Increased demand for cryptocurrency mining tools
  • Solid reputation

Cons

  • Potential overvaluation
  • Volatility
  • Competition in the self-driving space
blocks letter of the alphabet

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Alphabet (GOOG, GOOGL), Google’s parent company, is one of the five most valuable companies in the world. Currently selling at around $1,025 per share, Alphabet is not the best artificial intelligence stock for you to buy if you are looking to double your investment quickly due to its high starting price. However, if you are patient, this will turn into a good investment for you should you choose to buy. Alphabet currently has a P/E ratio of 20.99.

Pros

  • Financial security
  • Size
  • Diversity

Cons

  • Reliance on advertising
  • Significant competition
  • Information privacy concerns
Twilio Logo

Image via Twilio

Twilio (TWLO) is currently selling for around $81 per share and has a P/E ratio of 0.08. However, the company is growing quickly and the technology they are developing rivals Google, particularly in the speech-to-text department and understanding phone calls’ intent. It is not unreasonable to expect a return on investment of 500% with this cloud software company currently valued at only $3.8 billion.

Pros

  • Unmatched competitor
  • Loyal customers
  • Enormous market

Cons

  • Relies on large accounts
  • Competitive market

Amazon website flashed on the laptop

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Amazon.com (AMZN) took 14 years to finally show a $5 million profit in the final quarter of 2001. This was only thanks to a recent tax cut. However, Amazon’s founder Jeff Bezos continued to have faith that investing in future opportunities was worth more than financial statements and that stance has paid off royally.

With a market cap of over a trillion dollars and a history of cutting-edge technology, Amazon is definitely one of the top artificial intelligence stocks to watch this year. With a P/E of 47.33, it is clear that people around the world believe in the company’s vision and finds confidence in the company’s success.

Pros

  • Profit can occur at any time
  • Disrupts any industry it has in its sights
  • 44% market share of the domestic e-commerce market

Cons

  • Volatile
  • Overpriced by some metrics
Micron Technology Logo

Image via Micron

Similar to Nvidia, Micron Technology (MU) is another artificial intelligence chipmaker. However, their niche is in memory chips along with SK Hynix and Samsung. They command an 80% market share, and demand is soaring.

If you believe in a future with the “internet of things” or autonomous driving, buy shares up now while they hover around $31. The P/E ratio is only 3.32 right now, but this company has a strong global foothold in an exploding niche, and stock prices will likely explode soon.

Pros

  • Minimal risk of trade wars
  • High DRAM prices
  • Affordable stock

Cons

  • Cyclical stock
  • DRAM demand may weaken
  • Competition is improving production efficiencies
Microsoft Logo

Image by pixabay

Microsoft Corp. is known as one of the best dividend stocks but did you know it was also one of the best artificial intelligence stocks? Microsoft (MSFT) has seen the writing on the wall and pivoted to become a cloud-focused company. They are currently focusing their energy on human language technologies and the medical field.

Microsoft has a greatly undervalued P/E ratio of 18.97 and is currently selling at around $97. Microsoft’s dividend payouts have increased year-over-year since 2011, and they pay on time every quarter. Automatically reinvest your dividends, and your account will thank you in the future when Microsoft stands next to the AI giants Amazon and Google.

Pros

  • Billions in quarterly operating cash flow
  • Several diverse business segments
  • Significant cloud-based research

Cons

  • Threats including Apple and Google
  • Lack of focus in investing
  • Top executives leaving for competitors

Baidu Logo

Image via Baidu

Baidu will be a force to be reckoned with in the near future. The most advanced AI company in China, Baidu (BIDU) has a P/E ratio of 17.77. It currently has a stock price hovering around only $155, but it is showing significant growth since its inception.

Furthermore, China has announced they plan to be the global AI leader in 2030 and China, with 1.4 billion countrymen to support it, is known for heavily subsidizing national priorities. Keep your eye out for China to take over niches such as voice replication, virtual assistants and driving technology.

Pros

  • Leading search engine in China
  • Dominant mapping service in China
  • A highly profitable core business

Cons

  • Political risks of Chinese investing
  • Reliance on ad and search revenue
  • Diversification would lower margins
Intel Sticker logo on laptop

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Intel Corp. (INTC) is perhaps better known for its chip semiconductor production than Nvidia even though its stock price, currently around $44, does not show it. Late in 2017, Intel hired AMD’s primary GPU architect to lead a new team known as Core and Visual Computing. It is in a uniquely strong position to gain a foothold in the internet of things, machine learning and more thanks to this acquisition.

Furthermore, while Nvidia boasts $1.5 billion in free cash flow annually, Intel generates over $10 billion in revenue over expenses each year. This puts them in a much better position to invest in research and development.

Pros

  • Solid position in the internet of things
  • R&D provides 38% of all revenue
  • 3.4% dividend yield

Cons

  • Poor mobile market share
  • PC sales are dropping
  • Heavy competition in the security sector

facebook Logo

Image by pixabay

You might be surprised to see Facebook on a list of the top artificial intelligence stocks to invest in. However, machine learning requires vast amounts of data to grow and thrive. Facebook has 2.2 billion monthly active users, and AI is a core component of Facebook’s business. It drives everything from screening fake news, powering its virtual assistant technology and chatbot, allowing cutting-edge facial recognition technology and powering its News Feed algorithm.CEO Mark Zuckerberg has a goal of machines reaching seeing, hearing, cognition, and language on the level of humans by 2015 and Facebook is well on its way in no small part thanks to the amount of consistent, high-quality data it receives. To help him achieve this goal, Zuckerberg hired Jerome Pesenti, one of IBM’s pioneer artificial intelligence researchers to lead Facebook’s AI research team and machine learning division.

Pros

  • Video streaming
  • Strong position
  • Rapid growth

Cons

  • Decline in sharing
  • Maybe overvalued
  • Snapchat may be taking users
tencent logo

Image via Tencent

Tencent is China’s largest social media company. Like Facebook, it receives an enormous consistent supply of data for AI to learn from. The company behind WeChat, Tencent (TCEHY) recently built an AI research lab in Seattle, Washington led by a 20-year veteran of Microsoft Research. The stock price is currently only around $38, making it a good artificial investment stock to buy into if you want to see large gains quickly.Tencent provides the world with many popular platforms that allow it to test and implement real-world artificial intelligence software including virtual assistants and voice-to-text. Keep in mind these are only the projects the company is working on currently. Like Jeff Bezos, Ma Huateng, Tencent’s CEO, is a visionary investing in the ability to research and develop AI applications that we cannot even imagine today.Keep a close eye on this company. They will do great things in the future, and this idea is backed by its 28.16 price-to-earnings ratio. While this has been decreasing this past year, it is still strong enough to indicate that people have faith in the company and is a strong indicator that stock prices will rise.

Pros

  • A dominant social media platform
  • A world leader in games
  • A top technology company in China

Cons

  • Alibaba strong competition
  • Significant decrease in P/E ratio

The Verdict

artificial intelligence

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As of 2019, the best artificial intelligence stocks are Alphabet, Twilio, Microsoft Corp. and Intel Corp. After reviewing the financial statements of Baidu and Tencent, it is clear that the only certainty right now is the uncertainty of how the Chinese government and its laws will affect the companies operating within China. Intel is a solid choice to invest in thanks to its incredible annual operating cash flow available for investing in AI research.Alphabet provides all the stability that comes along with Google, an incredible market share in the search market, significant ad revenue, high quality data coming in daily to teach and grow AI and multiple solid revenue streams. Microsoft has been losing top executives to competitors such as Facebook and Amazon, but they are acquiring even better talent from other competitors to fill in the gaps and pave the way for greater progress.Aside from being a cash cow and having many business lines including Windows and Xbox, Microsoft has also been one of the best stocks to invest in due to the ever-increasing quality of dividends payouts. Finally, we recommend Twilio because we believe it to be significantly undervalued, and the market is poised to correct itself at any time.

Remember to do your due diligence when picking out a stockbroker and do not put all your eggs in one basket. Mitigate your risk in the stock market by investing in multiple industries and revisiting your ratio of stocks and bonds on an annual basis to ensure you are not exceeding your ideal risk versus reward ratio. Finally, remember that time in the market always beats timing the market, so do not wait for the next market crash to start buying up stocks. Happy investing!