Table of Contents
Table of Contents
Best Value AI Stocks
Fastest-Growing AI Stocks
AI Stocks With the Most Momentum
Advantages of AI Stocks
Disadvantages of AI Stocks
The Bottom Line
- Stocks
- Tech Stocks
These are the top AI stocks based on best value, fastest growth, and most momentum
By
Nathan Reiff
:max_bytes(150000):strip_icc()/reiff_headshot-5bfc2a60c9e77c00519a70bd.jpg "Best AI Stocks for April 2024 (1)")
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Nathan Reiff has been writing expert articles and news about financial topics such as investing and trading, cryptocurrency, ETFs, and alternative investments on Investopedia since 2016.
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Updated April 01, 2024
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With the start of the second quarter of 2024, artificial intelligence (AI) continues to be a key trend across many sectors. Providers of chips and other hardware or software necessary to power AI systems have seen significant gains in recent months. Major tech firms have scrambled to prioritize AI, with Apple (AAPL) expected to reveal its AI strategy at its Worldwide Developers Conference in June. But while industry leaders have experienced huge rallies, gains have not been even across all AI firms. The Nasdaq CTA Artificial Intelligence & Robotics Index, a benchmark for the broader AI industry, is up 11% in the last year—only a third of the Russell 1000 Index's 31% improvement.
Below, we explore the best AI stocks for April 2024, considering those with the best value, fastest growth, and most momentum. Data are current as of March 26, 2024.
Best Value AI Stocks
Value investing is a strategy based on the principle that some stocks trade at prices that are below their intrinsic value. Investors able to identify these stocks, usually through analysis of fundamental metrics, may be primed for a return on their investment when the market corrects the mispricing and the stocks rise. One such metric is the price-to-earnings (P/E) ratio. Lower P/E ratios are generally considered to be signs of a more attractively valued company since it is valued at less than its fundamental value.
| Best Value AI Stocks | |||
|---|---|---|---|
| Price ($) | Market Cap ($B) | 12-Month Trailing P/E Ratio | |
| ClearOne Inc. (CLRO) | 1.81 | 0.04 | 2.2 |
| B.O.S. Better Online Solutions (BOSC) | 2.76 | 0.02 | 7.6 |
| Opera Ltd. (OPRA) | 15.84 | 1.4 | 8.3 |
- ClearOne Inc.: This is a communications technology firm that develops audio, video and web conferencing applications and related products. The company offers an AI configuration and control software tool called Console. In early March, ClearOne's board announced a special one-time dividend of $0.50 per common share to be paid on April 10.
- B.O.S. Better Online Solutions: This company is an Israeli firm specializing in supply chain and inventory solutions. B.O.S. utilizes AI in its Intelligent Robotics division, which automates industrial and logistic inventory processes. This division recently received a €615,000 (roughly $666,000) order for a robotic production line.
- Opera Ltd.: Opera is a Norwegian web application developer that designs and builds web browsers for mobile phones and PCs. Last year, Opera added ChatGPT and free VPN functionality to its browsers.
Fastest-Growing AI Stocks
Investors often evaluate growth stocks based on revenue and earnings per share (EPS), as these are key measures of a company's performance. Looking at only one of these two factors, however, can leave your search susceptible to temporary phenomena, including tax law changes or one-off gains.
We aim for a more balanced screen of AI growth stocks by looking at the most recent year-over-year percentage growth for both revenue and EPS, giving each equal weighting. We also exclude companies with growth rates in either category of 1,000% or more on the grounds that these are likely outliers.
| Fastest-Growing AI Stocks | ||||
|---|---|---|---|---|
| Price ($) | Market Cap ($B) | EPS Growth (%) | Revenue Growth (%) | |
| NVIDIA Corp. (NVDA) | 925.61 | 2,314 | 585.5 | 125.9 |
| ServiceNow Inc. (NOW) | 778.57 | 159.6 | 425.7 | 23.8 |
| International Business Machines Corp. (IBM) | 188.50 | 172.8 | 361.7 | 2.2 |
- Nvidia Corp.: A chip manufacturer that provides computer graphics processors, chipsets, and related software, Nvidia was the best-performing stock in the S&P 500 for 2023, more than tripling in value during the year.
- ServiceNow Inc.: This company is a provider of enterprise cloud computing solutions. ServiceNow is best known for its cloud-based Now Platform. In March, ServiceNow launched Now Assist, a new set of AI capabilities for its platform.
- International Business Machines Corp.: IBM is a major tech firm offering an array of products and services through Software, Consulting, Infrastructure and Financing business lines.
AI Stocks With the Most Momentum
Momentum investing is based on the principle that stocks that have increased at a faster rate compared with the market or their peers are likely to continue on that trajectory, at least in the short term, as long as there aren't fundamental changes to those companies' operations or the broader industry.
Below, we look at the AI stocks that have provided the highest total return in the last 12 months.
| AI Stocks With the Most Momentum | |||
|---|---|---|---|
| Price ($) | Market Cap ($B) | 12-Month Trailing Total Return (%) | |
| Super Micro Computer Inc. (SMCI) | 1,025.06 | 60.0 | 815.6 |
| MicroStrategy Inc. (MSTR) | 1,876.99 | 31.8 | 622.3 |
| Applovin Corp. (APP) | 71.09 | 24.3 | 398.9 |
- Super Micro Computer Inc.: This is a computing hardware company and a leader in the AI server market. On March 25, Super Micro was after JPMorgan analysts issued a bullish rating and price target.
- MicroStrategy Inc.: MicroStrategy Inc. is a business solutions, cloud services, and mobile software company that has in recent years become the world's largest corporate Bitcoin holder, with more than 214,000 tokens as of March 2024. MicroStrategy owns approximately 1% of all outstanding Bitcoin tokens.
- Applovin Corp.: This company provides a platform for mobile app developers to create and market their apps as well as analytics and other related tools. Applovin launched an AI-based advertising engine, AXON 2.0, in 2023.
Advantages and Disadvantages of Investing in AI Stocks
Advantages
Broad applications
Fast-moving innovation
Popular trend
Disadvantages
Industry uncertainty
Untested companies
Dangers of AI
Advantages of AI Stocks
Broad applications: AI has transformed—or has the potential to transform—a host of different industries and sectors. Companies positioned as leaders within the AI space could be well-positioned to benefit from widespread adoption and a broad, diverse customer base.
Fast-moving innovation: AI is at the forefront of innovation today, with both major tech firms and smaller up-and-coming companies working diligently to advance this technology. This means that the potential for breakthrough success may be huge as the industry continues to evolve.
Popularity: As of early 2024, AI is one of the most talked-about trends in technology. Interest in this space is very high, meaning that investors could be poised to benefit from tremendous momentum with the right investments.
Disadvantages of AI Stocks
Industry uncertainty: Although AI has been in existence for decades, it is only in the last several years that technological developments have brought this field into the mainstream. With changes and advancements happening incredibly quickly, it can be difficult for even the most knowledgeable investors to keep pace with what is happening in the industry. For instance, this means it could be easy for investors to get caught up in the hype surrounding a particular company after the ideal time to purchase that company's stock.
Untested companies: While many of the major tech firms are involved in AI, other AI companies have little history and foundation for investors to consider when selecting investments. These companies may pose a greater risk than more stable, time-tested firms.
Dangers of AI: Leaders in computer science and related fields have warned of the potential dangers associated with AI. As the field continues to expand and change, public opinion, regulations, and other factors may change and have the potential to impact AI stocks in unexpected ways.
The Bottom Line
AI stocks present investors with the opportunity to tap into one of the most popular—and potentially most revolutionary—technology trends today. With companies across virtually all industries and sectors exploring ways to integrate AI into their operations, firms that are focused on the hardware and software required to run AI programs stand to benefit. But there are significant risks to investing in AI stocks, including the uncertain future of the industry and the potential dangers of AI technology itself.
The comments, opinions, and analyses expressed on Investopedia are for informational purposes only. Read ourwarranty and liability disclaimerfor more info.
As of the date this article was written, the author does not own any of the above securities.
Article Sources
Investopedia requires writers to use primary sources to support their work. These include white papers, government data, original reporting, and interviews with industry experts. We also reference original research from other reputable publishers where appropriate. You can learn more about the standards we follow in producing accurate, unbiased content in oureditorial policy.
Bloomberg. "Apple Set to Unveil AI Strategy at June 10 Developers Conference."
ClearOne. "CONSOLE AI Configuration Software."
ClearOne. "ClearOne Announces a Special One-time Cash Dividend."
B.O.S. Better Online Solutions. "BOS’ Intelligent Robotics Division Receives an Order for €615,000."
Opera Ltd. "Opera Goes Live with Generative AI Tools in Desktop Browser and Opera GX."
ServiceNow Inc. "ServiceNow furthers generative AI leadership with new capabilities in the Washington, D.C. platform release."
Bloomberg. "MicroStrategy Owns About 1% of All Bitcoin With Latest Purchase."
Applovin Corp. "AppLovin AI Advancements to Accelerate Partner Growth."
LeewayHertz. "AI USE CASES & APPLICATIONS ACROSS MAJOR INDUSTRIES."
New York Times. "A.I. Poses ‘Risk of Extinction,’ Industry Leaders Warn."
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