2 AI Stocks That Could Make You a Millionaire | Technology and Business

2 AI Stocks That Could Make You a Millionaire | Technology and Business
2 AI Stocks That Could Make You a Millionaire | Technology and Business

2 Artificial Intelligence Inventories Can Help You Get Rich

Sophisticated entrepreneurs and parents are in the early stages of mass market growth.   

The Artificial Intelligence (AI) software market is expected to grow 21% this year, while the overall AI market is expected to grow at a CAGR of 40% by 2028. Investors will be hard pressed to find another market with the expected strength.

The key players in this market are Nvidia (NVDA-2.10%) and IBM (IBM 0.10%), both of which are moving towards enabling more efficient and automated lifestyles with potential for improvement and life-saving potential. Both can provide the resources needed to build your long-term portfolio.

1. Nvidia's AI effect continues to spread  

The company's world-class GPUs and system-on-chips are the backbone of 80 percent of the AI ​​market, supporting countless technological advances, including game consoles, cars, medical imaging technology and increasing sophistication. Some of the company's clients include Amazon Web Services and Alphabet.

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Many of us use Waze or Google Maps while driving. That data is powered by the Google Cloud Platform, which is powered by Nvidia GPUs. Imagine what the next 10+ years could bring, as AI will play a major role in mobility as more self-driving cars become more abundant. This is one of the areas of artificial intelligence in Nvidia.

Over the next decade, business and society will move in a direction that includes augmented reality, virtual reality, automation, prediction, and optimization to achieve accurate, real-time results. Nvidia's leadership in artificial intelligence led the company to a 1 trillion addressable market. Nvidia showed its growth in its fourth-quarter report, with record full-year revenue growth of 61% year-over-year to $ 27 billion, supported by 53% year-over-year growth in fourth-quarter revenue.

The special demand for Nvidia that CEO Jensen Huang sees is driven by gaming, data centers and visualization platforms. Revenue is expected to grow by 45% in the first quarter of last year - already 84% higher than a year ago, and its business power should continue.

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Its shares lost 20% in the month following the fourth quarter results as a result of the collapse of the larger market. It has recovered, but it is still only 5.5% higher than when the company reported quarterly and full-year earnings and a positive outlook. At $ 280 per share, Nvidia's average analyst target price is $ 352 - the highest of $ 410 - and it's based on expected market growth and leadership and a great product for a large, manageable market.

2. Conversion from IBM mainframe to mainstream AI  

If you've ever experimented with Scantron papers, you know, the ones you fill in with bubbles in # 2 pencils. They were labeled by the IBM machine using a 1937 process and are still in use today. But the old IBM is fast becoming the new IBM - and the future will focus on artificial intelligence. This allows investors to process some profits and generate additional returns.

The inventors of floppy disks, hard disk drives, and UPC barcodes are adapting and evolving to increase our reliance on changing work environments and automation, optimization, and data protection. In 2020, IDC recognized IBM's market-leading 13.7% share in the AI ​​lifecycle software market, five years in a row after being ranked number one on the global AI software platform. The prestigious research firm Gartner is now recognized as a leader in the development of cloud artificial intelligence, data science and machine learning platforms.

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IBM offers a variety of scalable solutions for its AI products under the Watson umbrella, including content search and analysis, data and risk management, and governance and compliance. These solutions help its clients to be smaller by reducing operational costs. These savings may be reinvested in future growth, which may include additional costs for IBM solutions.

Aggressively moving forward, IBM is working to grow into an open, AI-powered hybrid cloud platform exploring $ 1 trillion hybrid cloud business opportunities. To further focus on this area, the company has copied its managed infrastructure services to a public company called Kyndryl. A broader focus on the global hybrid cloud market will benefit IBM, which is expected to grow at a compounded rate of 17.6%, while shared infrastructure is expected to grow by 10%.

The company has seen its steps paid off. Fourth-quarter earnings and revenue exceeded analysts' expectations, the company's fastest quarterly revenue growth since 2011. As a result, net income for the quarter increased by 72%. The 2022 outlook includes mid-single-digit revenue growth driven by cloud services and AI solutions, although the company warns that revenue will begin to decline as labor costs begin to rise in the next few quarters. Signs of recession.

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But for long-term investors, the short-term challenges associated with earnings uncertainty can be overcome thanks to a 5 6.56 per share (equivalent to 5% dividend) dividend. In addition, these dividends can be received in cash when paid quarterly, which can provide investors with a buffer against a 5% reduction in the stock price, or generate even higher returns if they choose to reinvest dividends. Either way, it's great to see how far IBM has come in over 100 years and how far it can go in the next five years, which could mean huge profits for investors.

Source: Jeff Little, The Motley Fool, Direct News 99