Expert Reveals June 2024’s Top Must-Invest AI Stocks

Choosing Stock Market as Career

This week it was reported that NVIDIA has surpassed Microsoft as the world’s most valuable company, thanks to its AI offerings which have seen it almost triple its stock this past year. 1 For investors looking to invest in AI technologies, there are plenty of opportunities to capitalise on AI’s rapid growth. 2 Even if you choose not to invest in AI stocks for your portfolio, these companies’ success is likely to impact the businesses you are monitoring.

But which companies are actually driving the trend and not following it? The stock market experts at City Index have shared the five best AI stocks to watch in 2024.

Five best AI stocks for 2024

  1. Nvidia (NVDA) 

Nvidia had a record year in 2023, profiting from the boom of OpenAI’s large language model software, ChatGPT. The company’s graphics cards are some of the most valuable semiconductors available, partly driving Nvidia’s valuation past $1 trillion last year, which has now surpassed $3.34 trillion (£2.64 trillion) as of June 2024. Competitors such as AMD and Intel are worth only a fraction of that figure, leaving Nvidia head and shoulders above its competition in 2024.

  1. Altair Engineering (ALTR)

The company posted strong revenue figures in 2023—a 12.3% increase YoY—and nearly tripled its free cash flow from $5.2 to $14.7 million (£11.7 million). The future looks bright for the company, as it also released its updated AI-powered data analytics tool, RapidMiner, in November 2023.

  1. C3.ai (AI)

C3.ai’s stock price fell from last year’s high of $44.49 to under $30 at the start of 2024. Analysts’ projections place C3.ai’s revenue to grow by 19.8% this year and 23.6% in 2025, up from 14.7% in 2023. However, the stock isn’t expected to reach profitability until the end of its 2025 fiscal year. It’s now a question of whether or not to bet on the cloud software provider’s potential upside. C3.ai has a lot of room to grow if it can recover to its post-IPO price of $119.58 in December 2020.

  1. Palantir (PLTR)

Palantir had a successful 2023, with its stock price rising from $6.40 to a high of $20.27 in December. Both its revenue and earnings per share are expected to grow by about 20% this year, so there’s no reason the stock won’t continue to thrive as enterprise AI solutions remain in demand.

  1. Upstart (UPST)

As an AI-powered lending assistant, Upstart’s revenue is closely linked with US federal interest rates. Despite high rates being one of the reasons the company failed to reach revenue forecasts in 2023, the Federal Reserve is expected to begin cutting interest rates in 2024. This means more individuals may be looking to borrow money this year, and Upstart’s services could be in higher demand.

Matt Weller, Head of Market Research at City Index, comments:

“In 2024, the landscape of AI stocks presents intriguing opportunities for investors. Companies at the forefront of artificial intelligence, such as Nvidia and Altair Engineering, are worth watching closely. These firms have demonstrated exceptional innovation and a strategic vision that aligns with the evolving demands of the market.

AI’s ability to swiftly process information, coupled with predictive analytics, allows investors to stay ahead of the curve in an ever-changing market landscape. The integration of natural language processing has not only amplified our understanding of market sentiment but has also opened doors to new dimensions of data interpretation.

As the demand for AI solutions continues to surge, these companies are well-positioned to capitalise on the market trends, making them compelling choices for investors looking to navigate the dynamic landscape of AI stocks in the coming years.”

What AI means for the stock market

When choosing the best AI stocks for 2024, we focused on the companies building the infrastructure for the AI revolution. The stocks on this list power AI and LLMs either by manufacturing the graphics processing units (GPUs) used in hyperscale data centres or by providing data analytics software integrating generative AI for big tech companies like Apple and Microsoft. You can trade these and other top AI stocks in one fund with the AI index available on City Index.

AI has revolutionised the stock market, with algorithmic trading and predictive analytics at the forefront. Algorithms powered by AI analyse market data swiftly, enabling rapid trade execution, whereas, predictive analytics, driven by AI models, forecasts stock prices and market trends through in-depth scrutiny of historical data. Using AI to harness the power of big data may provide traders and investors with the tactical advantage they need to navigate an increasingly unpredictable market.

CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. 69% of retail investor accounts lose money when trading CFDs with this provider. You should consider whether you understand how CFDs work and whether you can afford to take the high risk of losing your money.

About Neel Achary 19614 Articles
Neel Achary is the editor of Business News This Week. He has been covering all the business stories, economy, and corporate stories.