3 Hidden-Gem AI Stocks Ready to Ride a Massive Market Wave


  • Here are three top, hidden-gem AI stocks to buy and hold today.
  • Nerdy Inc. (NRDY): Goldman Sachs recently raised its price target on NRDY to $3.25.
  • SoundHound AI (SOUN): Analysts at Ladenburg initiated coverage of SOUN with a buy rating, with a $4 price target.
  • BigBear.ai Holdings (BBAI): Cantor Fitzgerald just initiated an overweight rating on the stock, with a $3 price target.
Hidden-gem AI stocks - 3 Hidden-Gem AI Stocks Ready to Ride a Massive Market Wave

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By now, you’re well aware of the artificial intelligence boom. You know Big Tech has been investing billions into it. You also know the market could be worth billions, if not trillions, which is great news for well-known AI stocks and even hidden-gem AI stocks.

In fact, according to Allied Market Research, the generative AI market could be worth $191.8 billion by 2032. Healthcare AI, according to SNS Insider, could be worth nearly $187.57 billion by 2030. The AI cybersecurity market could be worth $133 billion by 2030, says Techopedia. Even the education AI market could be worth $150 billion by 2027, according to IDC. In short, there’s incredible potential to make gobs of money from AI.

And while you can always invest in Nvidia (NASDAQ:NVDA), Advanced Micro Devices (NASDAQ:AMD), and Microsoft (NASDAQ:MSFT) to take advantage of the story, you may want to consider the hidden-gem AI stocks, such as:

Nerdy (NRDY)

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Leveraging AI to deliver live online learning, Nerdy (NYSE:NRDY) is still undervalued. At just $3.21 a share, the $372 million company has been delivering revenue and profitability that have been well ahead of its expectations. Revenue, for example, just popped for $40.3 million in the third quarter, which was above its guidance range of $38 million to $40 million.

Even better, “For the fourth quarter of 2023, we expect revenue in a range of $54-56 million, representing 32% growth at the midpoint vs. our Q4 2022 revenue of $41.8 million. For the full year, we expect revenue in a range of $192-194 million; representing 19% growth at the midpoint vs. our 2022 revenue of $162.7 million,” noted Nerdy in a company press release.

Helping, Goldman Sachs recently raised its price target on NRDY to $3.25.

SoundHound AI (SOUN)

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Or, take a look at hidden-gem AI stocks, like SoundHound AI (NASDAQ:SOUN), a $582 million voice AI and speech recognition company trading at just $2.30 a share. 

Helping, just days ago, analysts at Ladenburg initiated coverage of SOUN with a buy rating, with a $4 price target. Analysts at Northland also just named SOUN a “top pick for 2024,” noting that SOUN is gaining momentum.

Better, the company is benefiting from voice AI demand, as more restaurants automate ordering. According to FoodonDemand.com, “It seems almost daily, another restaurant is testing or implementing voice AI to take over phone and drive-thru orders. The reasoning remains consistent across the board, ‘to deal with labor shortages and free up staff time so they can focus on in-person customer service’ or “to upsell and never miss a call.’”

Most recently, SOUN inked a deal to take orders for Jersey Mike’s Subs. It’s also working with White Castle, Krispy Kreme (NASDAQ:DNUT), Toast (NYSE:TOST), and Block (NYSE:SQ) to name a few.

Earnings have been solid, too. In its most recent quarter, SOUN saw revenue of $13.3 million – a 52% sequential increase, and a 19% year over year increase. Its operating loss improved by 46%. Net loss improved 33% year over year. It also saw a 57% improvement in adjusted EBITDA year over year, as well.

BigBear.ai Holdings (BBAI)

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Or, take a look at BigBear.ai Holdings (NYSE:BBAI), a $283 million company that provides AI and machine learning for decision support for government and defense, manufacturing, healthcare, and life sciences. 

Most recently, BBAI announced it was working with Amazon (NASDAQ:AMZN) Web Services Professional Services. “This is a landmark moment for BigBear.ai, as our work with AWS will focus the power of AI on supply chains and logistics operations around the world,” said CEO Mandy Long.

Better, analysts at Cantor Fitzgerald just initiated an overweight rating on the stock, with a $3 price target. Plus, in its third quarter, the company posted its first quarter of positive net income, positive adjusted EBITDA, and positive cash flows from operations since public company debut in December 2021, as noted in a company press release.

On the date of publication, Ian Cooper did not hold (either directly or indirectly) any positions in the securities mentioned. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.com Publishing Guidelines.

Ian Cooper, a contributor to InvestorPlace.com, has been analyzing stocks and options for web-based advisories since 1999.

Article printed from InvestorPlace Media, https://investorplace.com/2024/02/3-hidden-gem-ai-stocks-ready-to-ride-a-massive-market-wave/.

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