The launch of OpenAI’s ChatGPT created a major buzz around artificial intelligence (AI) stocks.
ChatGPT is an AI chatbot software application that uses machine learning techniques to emulate human-written conversations. A hitherto niche subsector in the AI industry, this technology is called generative AI, and it’s been making an impact on myriad industries, including marketing, security, healthcare, gaming, communication, customer service and software development.
Although investors can’t directly take a position in privately owned OpenAI, several technology stocks offer exposure to the expected growth in generative AI technology.
Below, the Investing News Network showcases 12 technology stocks that stand to benefit the most from the rise in advancements and adoption of AI chatbot technologies and seven smaller companies that may be perfectly positioned to profit from their advancements in generative AI.
All market cap and share price data were current as of August 8, 2024.
These 12 tech giants offer investors exposure to generative AI by offering their own chatbots and generative AI products, developing the hardware and software necessary for AI and integrating AI into their product.
Market cap: US$2.99 trillion; current share price: US$402.69
Market cap: US$2.58 trillion; current share price: US$104.97
Nvidia is a pioneer and global leader in graphics processing unit (GPU) technology. Nvidia designs specialized chips used to train AI and machine learning models. The company also offers supercomputing processing capabilities to scientific researchers around the world.
While its been well known in computer and gaming spaces for a long time, its focus on the AI sector has been driving its growth in recent years. Nvidia’s market value has grown by 135 percent year-over-year and at one point the company even took the title of world’s most valuable company from rivals Microsoft and Apple.
Market cap: US$2 trillion; current share price: US$162.03
Alphabet is leveraging generative AI across its business segments. Its AI accelerator chip, TPU v5p, was developed for neural network machine learning and is designed to scale large clusters, reducing the time needed to train large language models.
Market cap: US$1.74 trillion; current share price: US$165.80
Amazon subsidiary and cloud-computing platform Amazon Web Services (AWS) evolved out of Amazon’s transition from an online retailer to one of the world’s largest technology companies. AWS’s wide range of services includes computing, storage, databases, networking, analytics, machine learning and AI.
Market cap: US$1.29 trillion; current share price: US$509.63
Meta CEO Mark Zuckerberg has maintained that increased spending on AI infrastructure is necessary to maintain its competitive position. The company has been implementing cost-saving measures to offset these investments and balance the financial impacts of its AI initiatives.
Market cap: US$635.22 billion; current share price: US$198.84
Market cap: US$355.4 billion; current share price: US$128.96
Market cap: US$239.65 billion; current share price: US$206.28
Market cap: US$235.11 billion; current share price: US$530.24
Market cap: US$184.64 billion; current share price: US$45.83
Multinational digital communications firm Cisco Systems is a leader in IT and communications networks. The company has a large portfolio of multi-cloud products and applications, alongside strong relationships with Azure, AWS, Nvidia and Google Cloud.
Market cap: US$177.42 billion; current share price: US$192.61
Market cap: US$87.23 billion; current share price: US$20.49
The following companies have not yet reached the market capitalization of our top 12, but are each worth billions of dollars and have made some amazing achievements in generative AI technology in their own right, making them interesting prospects for investors.
In alphabetical order, they are:
Generative AI is an emerging AI technology based on deep learning models and algorithms that can generate text, images or sounds in response to prompts given by users.
Some of the most notable examples of generative AI are ChatGPT, DALL-E 2, Midjourney, Stable Diffusion, Gemini and Copilot.
OpenAI’s DALL-E 2 is an AI system that can create realistic images and art from a description in natural language. Similar to DALL-E 2, Midjourney generates images from prompts. Stable Diffusion is a latent text-to-image diffusion model capable of generating photo-realistic images given any text input. Microsoft’s Copilot is a feature of the Bing search engine that leverages the same technology as ChatGPT.
This is an updated version of an article first published by the Investing News Network in 2023.
Securities Disclosure: I, Meagen Seatter, hold no direct investment interest in any company mentioned in this article.
Leave a Reply