Following their strong performance in the previous year, stocks related to artificial intelligence have picked up momentum once more. As investor confidence grew that President Donald Trump’s trade tariffs may not pose as significant an obstacle for companies as first anticipated, these high-growth stocks started climbing higher again.
In recent months, the prospect of high tariffs initially caused concern among investors about potential reductions in AI investments and increased costs across various sectors. However, as U.S.-trade negotiations advanced, investor sentiment improved, and they began paying attention to optimistic news like companies reaffirming their commitment to AI investment and discussing strategies for operating within a tariff environment. This newfound optimism made the situation seem more manageable, leading investors to once again show interest in growth stocks, including those involved in AI.
Currently, as these stocks rise, one might assume they’re trading at high prices. However, for investors interested in AI stocks or looking to increase their existing positions, there are still attractive deals available. Remarkably, some of these deals are even on market titans who have already demonstrated their AI capabilities. Let’s explore two AI stocks that are priced lower than anticipated.
1. Meta Platforms
Meta, the company behind Facebook, Messenger, Instagram, and WhatsApp, has constructed a vast social media domain that is utilized by approximately 3.4 billion people every day. This massive user base has enabled Meta to consistently generate billions of dollars in revenue. So, how does Meta achieve this? Primarily through advertising. Businesses seeking to market their products or services to us do so by advertising on Meta’s platforms, aiming to capture our attention effectively.
Beyond just social media, Meta is also venturing into various domains, notably AI research and development. In fact, they’ve gone as far as developing their own large language model, named Llama. This project has been made open source, inviting others to collaborate and potentially steer Meta towards a leading position in the field.
It’s possible you’re curious about how Meta plans to generate revenue using AI. To begin with, Meta has introduced a popular virtual assistant that’s used by millions worldwide. This increased usage means people are spending more time on Meta’s platforms, which could lead advertisers to invest more in these spaces to reach their intended audiences. Moreover, Meta’s AI is expected to play a role in helping advertisers design more effective ad campaigns as well.
AI proficiency can potentially expand the range of goods and offerings for which Meta might generate income. For instance, Meta has recently initiated Meta Advanced Intelligence Research (or MAIR), a project aimed at enhancing the company’s AI capabilities.
It’s plausible that these developments will significantly expand Meta’s growth potential, given the projected expansion of the AI market to potentially exceed trillions of dollars in the near future. Consequently, with a valuation of 27 times forward earnings projections, Meta currently appears to be a reasonably priced investment opportunity.
2. Alphabet
Alphabet, represented by GOOG (-0.22%) and GOOGL (-0.32%), is currently triumphant in AI through two distinct strategies. The tech giant has created an original Language Model called Gemini, which it has integrated into its primary income source: Google Search, the globally recognized search engine with the highest usage. This integration of Gemini has improved the quality of results for users and also optimized the ad experience for advertisers on the platform. Similar to Meta, Alphabet derives a significant portion of its earnings from advertising, specifically across the Google platform.
The enhancements in Google Search are expected to encourage advertisers to maintain and potentially boost their advertising investment on this platform.
Here’s another way of expressing how Alphabet is profiting from AI through Google Cloud: Google Cloud, a division of Alphabet, provides artificial intelligence products and services to clients, which has propelled a significant growth in revenue by double digits. For instance, in the last reported quarter, Google Cloud recorded a 28% increase in revenue, reaching over $12 billion, attributing this surge to increasing demand for generative AI and AI infrastructure.
Indeed, Alphabet has already seen benefits from its AI investments; however, the revenue growth possibilities are still vast, given that we are merely skimming the surface of the AI narrative.
Given its history of consistent earnings growth and recent performance, Alphabet might appear to warrant a high valuation. However, quite surprisingly, it is the most affordable, trading at just 19 times forward earnings projections, among the top seven tech stocks that drove market advancements last year. At this price point, it’s an undeniably smart move to invest in Alphabet as a leading AI player for long-term growth.
Read More
- KPop Demon Hunters: Is Your Idol by Saja Boys Inspired by Real K-Pop Bands? Here’s What We Know
- Gold Rate Forecast
- Justin Bieber Teases New Album ‘SWAG’ with Tracklist Reveal
- 15 Best Sherlock Holmes Actors, Ranked from Worst to Best
- Superman’s Record-Breaking $21M+ Thursday Box Office: Highest of 2025
- 📢 BrownDust2 X BiliBili World 2025 Special Coupon!
- Ultraman Live Stage Show: Kaiju Battles and LED Effects Coming to America This Fall
- Tokyo Game Show 2025 exhibitors announced
- Superman’s Rotten Tomatoes Score Blasts Past Expectations—Shocks Even the Harshest Critics
- KPop Demon Hunters Had a Kiss Scene? Makers Reveal Truth Behind Rumi and Jinu’s Love Story
2025-07-17 17:35