Artificial intelligence (AI) has existed for many years. However, it’s rapidly becoming something that existed on the fringes to an integral part of our daily lives. That’s why this is the time for investors to look for AI stocks that will shape the future.
For some investors, investing in AI stocks means looking at the big names like Nvidia (NASDAQ:NVDA), Apple (NASDAQ:AAPL) and Microsoft (NASDAQ:MSFT). And let’s be clear: those companies will be leaders in AI for years to come.
But those stocks are known quantities that buy-and-hold investors have followed for years. AI may enhance their value, but it doesn’t change what the company is. If you’re looking for companies that will deliver AI in ways that we might not fully appreciate yet, you have to expand the field of stocks and sectors you’re looking at. Here are three AI stocks that are helping to design the blueprint for the future.
Palantir Technologies (PLTR)
It’s a bold statement to make that Palantir Technologies (NYSE:PLTR) may be the most important company in the world. But the company continues to show retail investors why Dan ives of Wedbush referred to Palantir as the Lionel Messi of AI.
As investors seek to understand why Palantir continues to win contracts in the public and private sectors, they are learning how Palantir’s unique semantic model (i.e., its ontology) sits on top of the digital assets in its platforms, which allows the company to set a standard that other companies can’t meet.
Despite qualifying for inclusion in the S&P 500 index in late 2023, Palantir was rebuffed for the index for the second time in June. However, if the company continues to deliver on its promise, that will only be a matter of time. And while institutional investors own just 45% of the float, it’s a good time for retail investors to accumulate shares.
Zillow Group (ZG)
Zillow Group (NASDAQ:ZG) is a digitized real estate platform that took off during the great relocation but has come crashing down to earth as interest rates moved from near zero to just over 5%.
As the latest inflation readings come in, it should be clear to investors that higher inflation will be around for some time. That means that the Fed funds rate and mortgage rates will stay near their current levels for some time as well.
However, the housing market is starting to show some resilience. It doesn’t have a choice. While phrases such as “the new normal” are becoming tiresome, there’s no denying that supply and demand issues represent a frustrating status quo that buyers must navigate.
As a digitally native company, Zillow is well-positioned to use AI to aid the buying experience. The company says that AI is at the core of its platform, which turns data into insights and engaging user experiences.
Planet Labs (PL)
If you’re looking for AI stocks that will define the future, you must look at the space sector. Planet Labs (NYSE:PL) is one of the companies in this sector already using AI to provide a competitive advantage. The company uses space, specifically satellite imagery, to help its customers better understand Earth. And AI is at the core of that.
Planet Labs provides its customers with geospatial tools that facilitate various services. AI is at the core of everything from satellite image analysis, pattern recognition and anomaly detection to predictive analysis and tracking objects of interest.
This is a tiny company with a market cap of just over $500 million. It qualifies as a penny stock, with shares trading for right around $2 as of June 12, 2024. But the company is growing revenue at a nice clip, and the 11 analysts that cover the stock give it a consensus price target of $4.49, which would give risk-tolerant investors a compelling 119% gain.
On the date of publication, Chris Markoch had a LONG position in PLTR. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.com Publishing Guidelines.
