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Artificial intelligence is by no means a new technology. The term was first coined by mathematician and computer scientist Alan Turing in 1950. Since then, generative technology has been around in one form or another for decades. However, it is only recently that advances in technology have allowed companies to turn the true concept of AI into a reality.
The launch of OpenAI’s ChatGPT in November 2022 has given the industry new life, forcing many to rethink what they currently thought was possible with AI. As a result, interest has skyrocketed as companies across technology have rushed to get in on the ground floor. Nasdaq Composite The index is up 68% since the start of 2023, driven primarily by excitement around artificial intelligence.
However, macroeconomic concerns have dragged the market lower over the past month, sending the same index down by about 4%. However, the recent declines are likely to be temporary, as many tech giants continue to enjoy strong financial gains from their AI offerings. As a result, now may be a great time to invest in the market before it’s too late.
So, here are two AI stocks you can buy after the tech market sell-off.
1. Advanced Micro Devices
Advanced Micro Devices (NASDAQ: AMD) The stock is down about 1% since the beginning of 2024, due to a difficult start to the year where it faced stiff competition from Nvidia But recent declines have seen its shares increase in value, making it a no-brainer investment for those looking to invest in it for the long term.
This chart shows AMD Price to Earnings (P/E) Ratio and price to sales ratio The numbers are below their 12-month averages. The numbers suggest that AMD is trading at one of its best values in months, making now a great time to invest in AI capabilities.
Since early last year, AMD has unveiled a slew of new AI products as it seeks to catch up with market leader Nvidia. On June 3, CEO Lisa Su said of the company’s ambitions: “AI is our number one priority, and we’re at the beginning of a very exciting period.”
During the same Computex keynote in Taipei, the company launched the Ryzen AI 300 series CPUs for laptops and the Ryzen 9000 series CPUs for desktops. AMD also revealed its data center chip roadmap, announcing the Instinct MI325X AI accelerators, slated for Q1 2024, the MI350 series for 2025, and the MI400 for 2026.
Meanwhile, AMD is already making promising progress in AI, evidenced by a 115% jump in revenue in its data center segment in Q2 2024. The company has attracted big names to its AI chip customer list, including Amazon, Microsoftand alphabet (NASDAQ: GOOGLE) (NASDAQ: GOOGLE)which strengthens its position in the sector.
AMD is on an exciting growth path, making its stock a no-brainer after the massive sell-off.
2. Alphabet
Alphabet shares are up 23% year-over-year, but down 13% over the past month. The company has suffered a market downturn that has affected dozens of tech stocks. Still, Alphabet remains an industry giant with an expanding role in artificial intelligence that makes its stock a compelling investment.
The tech giant has had its work cut out for it, capturing the third-largest market share in cloud computing behind Amazon Web Services and Microsoft Azure. However, Alphabet has made impressive strides over the past year, adding a suite of new AI tools to Google Cloud that have allowed it to outpace its competitors in growth.
In the second quarter of 2024, Alphabet reported a 13% year-over-year revenue gain, driven primarily by a 29% jump in Google Cloud sales. Meanwhile, Google Cloud operating income nearly tripled to more than $1 billion for the first time. For reference, AWS and Azure revenues were up 19% year-over-year in the same quarter.
In addition to cloud computing, Alphabet is using its Pixel smartphone brand to boost its AI presence. The company unveiled the Pixel 9 on August 13, debuting alongside a new Gemini-powered AI assistant. Gemini AI uses Alphabet’s large language model (LLM) to bring new image, text, and voice features to Pixel 9 users. The announcement came ahead of appleApple will announce its new iPhone in September, which is also expected to announce a range of new AI features for its 2024 smartphone lineup.
Alphabet shares are trading at an attractive price after a sell-off. The chart above shows that the company’s forward P/E ratio is significantly lower than Microsoft or Amazon’s P/E ratio, suggesting that Alphabet is one of the best value AI cloud computing stocks on the market.
Along with the amazing growth in AI and the strong brand, Alphabet stock is too good to ignore right now.
Should you invest $1,000 in Advanced Micro Devices now?
Before you buy shares in Advanced Micro Devices, keep the following in mind:
the Motley Fool Stock Advisor The team of analysts has just identified what they believe to be Top 10 Stocks There are 10 stocks available for investors to buy right now… and Advanced Micro Devices wasn't one of them. The 10 stocks that made the list could deliver massive returns in the years ahead.
Think about when Nvidia I made this list on April 15, 2005… If you invested $1,000 at the time of our recommendation, You will have $796,586.!*
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Susan Frey, CEO of Alphabet, is a member of The Motley Fool’s board of directors. John Mackey, former CEO of Whole Foods Market, an Amazon subsidiary, is a member of The Motley Fool’s board of directors. Danny Cook The Motley Fool has no position in any of the stocks mentioned. The Motley Fool has positions in and recommends Advanced Micro Devices, Alphabet, Amazon, Apple, and Microsoft. The Motley Fool recommends the following options: Buy $395 January 2026 calls on Microsoft and sell $405 January 2026 calls on Microsoft. The Motley Fool has Disclosure Policy.
2 AI Stocks to Buy After Tech Market Selloff Originally posted by The Motley Fool
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