HomeBusiness3 Artificial Intelligence (AI) Stocks to Buy This Month: April 2024

3 Artificial Intelligence (AI) Stocks to Buy This Month: April 2024

Artificial intelligence stocks are a hot topic on Wall Street. Keep in mind that a stock’s valuation always matters. You can’t blindly pay a price for even the best companies and expect the returns you want.

With that in mind, some quality stocks are trading at attractive prices today. Being among them Metaplatforms (NASDAQ: META), Sales team (NYSE: CRM)And SentinelOne (NYSE:S).

Here’s the pitch for each stock and why investors can buy it with confidence today.

Table of Contents

1. Metaplatforms

Social media giant Meta Platforms is using artificial intelligence (AI) to make more money from the nearly 4 billion people who use its apps every month. Brands can now use AI tools to increase the efficiency with which ads reach their target audience. Meta has grown to a valuation of over a trillion dollars across Facebook, Instagram and WhatsApp, but Threads is steadily emerging as social media’s next potential winner.

CEO Mark Zuckerberg noted during the company’s fourth-quarter earnings call that Threads, which competes with Elon Musk’s X (formerly Twitter), has grown to more than 130 million monthly active users. Threads is still virtually non-monetized as Meta focuses on growing its user base. Still, this momentum is promising for a company that has proven it can turn social networking into a cash cow.

See also  Looking for Blue Chip Stocks for Your Portfolio? Here are a wonderful seven to consider.

Do not get me wrong; Meta is a great buy, even without knowing how Threads will ultimately impact the company. The shares have soared over the past 18 months, but still trade at a price-to-earnings ratio of 24. Analysts believe the company will grow earnings at an average annual rate of 19% to 20% over the next three to five years , which will make the stock an important player. potential bargain for the expected growth. No company does social media like Meta Platforms.

2. Salesforce

Enterprise software has become a huge industry with Salesforce at the center of it. The company is built on its customer relationship management software, but has expanded to cover virtually every aspect of what you need to run a business. After several additional acquisitions, Salesforce also offers collaboration tools via Slack and data tools on Tableau.

Salesforce uses AI to improve its existing operations. This generative AI, which Salesforce calls Einstein, is being implemented across Salesforce to make its various products more usable. It’s like having a digital assistant by your side. It’s an internal AI that helps users answer questions, understand and predict customer behavior, and create content across all parts of Salesforce’s software suite.

Financially, Salesforce is trading at attractive levels today. The stock trades at 31 times 2024 earnings, but that is backed by solid earnings growth that analysts expect to average almost 18% in the coming years. That’s a reasonable PEG ratio of 1.8. Investors can nibble on these blue chip tech stocks and become more aggressive as the shares fall to a more attractive price.

See also  Shares of New York Community Bancorp continue to fall

3. SentinelOne

Other companies, like SentinelOne, built their products on AI. SentinelOne is a cybersecurity company that uses AI to proactively hunt viruses and other threats on devices and their networks. Cybersecurity is highly competitive, so SentinelOne must stay at the forefront of technology. The company has received awards from third parties such as Gartner because of its excellent protection.

SentinelOne has been criticized for not being a profitable company. However, quarterly cash burn has improved from $32 million to just $10 million over the past year, so free cash flow generation appears imminent. Moreover, SentinelOne has a sparkling balance sheet with no debt and $925 million in cash. The company should already be quite profitable by the time it runs out of cash.

That lack of profitability has caused the shares to sell at a discount. Its most direct competitor, CrowdStrike Possess, trades at more than twice the price-to-sales (P/S) ratio that SentinelOne does. That’s fair today, but long-term investors who believe SentinelOne can balance growth and make profits could enjoy picking up shares on the cheap. The stock’s price-to-earnings ratio is just 9 today, which was once more than 100 when the shares first went public.

See also  Fisker shuts down production for six weeks

Should You Invest $1,000 in Meta Platforms Now?

Before you buy shares in Meta Platforms, consider this:

The Motley Fool stock advisor The analyst team has just identified what they think is the 10 best stocks for investors to buy now… and Meta Platforms wasn’t one of them. The ten stocks that survived the cut could deliver monster returns in the coming years.

Stock Advisor provides investors with an easy-to-follow blueprint for success, including portfolio building guidance, regular analyst updates and two new stock picks per month. The Stock Advisor service has more than tripled the return of the S&P 500 since 2002*.

View the 10 stocks

*Stock Advisor returns April 1, 2024

Randi Zuckerberg, former director of market development and spokeswoman for Facebook and sister of Mark Zuckerberg, CEO of Meta Platforms, is a member of The Motley Fool’s board of directors. Justin Pope has positions in SentinelOne. The Motley Fool holds and recommends CrowdStrike, Meta Platforms, and Salesforce. The Motley Fool recommends Gartner. The Motley Fool has a disclosure policy.

3 Artificial Intelligence (AI) Stocks to Buy This Month: April 2024 was originally published by The Motley Fool

- Advertisement -


Please enter your comment!
Please enter your name here

Most Popular

Recent Comments