Under the Radar: 3 AI Sleeper Stocks to Own Now


  • Move over Nvidia and Advanced Micro Devices, these three sleeper AI stocks have incredible upside potential.
  • Palantir Technologies (PLTR): Palantir’s AIP has been a game-changer for the business.
  • C3.ai (NYSE:AI): AI stock looks highly undervalued at $30.
  • Qualcomm (NASDAQ:QCOM): The partnership with Microsoft could boost the stock.
AI stocks to buy - Under the Radar: 3 AI Sleeper Stocks to Own Now

Source: shutterstock.com/Allies Interactive

Unless you’re living under a rock, you have heard about artificial intelligence (AI) and its impact on our lives. The earnings season was all about AI and several tech companies reported impressive financials driven by AI. Companies not investing in AI could be left behind in the race to the top and if you do not embrace it in your life, you could be left out. The future is AI and Nvidia (NASDAQ:NVDA) is proof that it pays off.

The company is an industry darling and its stock has soared over 154% year-to-date. I’d recommended buying Nvidia in 2022 when it was trading at $243. However, if you missed that opportunity, here’s another chance for you to get in on the AI hype. Here are three AI stocks to buy before they soar.

While it might not be possible for these companies to rally like Nvidia did, they do have the potential to skyrocket and grow your money. Let’s dive deep into them. 

Palantir Technologies (PLTR)

In this photo illustration, the Palantir Technologies (PLTR) logo is displayed on a smartphone screen.
Source: rafapress / Shutterstock.com

Do not make the mistake of thinking that Palantir Technologies (NYSE:PLTR) is only moving due to AI hype. This company has substance and it has proved its strength several times in the past.

Its Artificial Intelligence Platform (AIP) is a huge success and has helped convert several leads into clients. Palantir offered AIP boot camps to companies who were keen to learn about how the platform worked and these boot camps led to the addition of new clients. It is set to unveil new products and customers at the AIPCon today.

The company reported its sixth consecutive profitable quarter with a net income of $105 million. The commercial business accounted for 24% of the total revenue which came in at $634 million.

Recently, the company signed a $480 million contract with the U.S. Department of Defence until 2029. Palantir has remained an integral service provider for the Government and while its commercial client base has increased, it continues to bag government contracts. It has also partnered with Eaton (NYSE:ETN), an energy systems manufacturer to improve Eaton’s supply chain efficiency through Palantir’s platform. 

Trading at $22, PLTR stock looks undervalued to me and could be one of your best AI bets. The stock is up 38% year-to-date and 48% in the last 12 months. It has attracted major companies which has helped boost revenue. Palantir offers an ideal combination of growth and innovation, making it one of the best AI sleeper stocks to own.

C3.ai (AI)

C3IoT (AI) website displayed on a modern smartphone
Source: Piotr Swat / Shutterstock.com

Overlooked AI stock C3.ai (NYSE:AI) is trading for $30 today and is up 23% in the past month and 6% YTD. The stock soared after the company reported results and shared a strong forecast for the rest of the year.

This is one company that has been investing in AI long before it gained this hype. Several businesses across industries are using C3.ai to enhance AI adoption and with the rising demand, the company’s revenue is soaring. 

In the third-quarter results, C3.ai reported revenue of $78.4 million, an 18% YoY jump, and the GAAP net loss was $0.60 per share. Its subscription revenue, which consists of 90% of the total revenue saw a 23% YoY jump to reach $70.4 million.

It managed to close 50 new deals including 29 pilots. For the fourth quarter, it is aiming for revenue in the range of $82 billion to $86 billion. While it is important to keep in mind that the company is losing money, it could become an AI giant in the next five years.

This is a crucial period of growth for the company and investors who get in on the ride while the stock is undervalued, can reap solid returns.

The opportunities in AI are only going to expand and C3.ai has over 40 turnkey AI applications that can be easily plugged into any business operation, making it a crucial aspect of the tech and AI sector. 

Qualcomm (QCOM)

Qualcomm (QCOM) logo on the side of a building in San Jose, CA.
Source: jejim / Shutterstock.com

Cathie Wood’s favorite stock Qualcomm (NASDAQ:QCOM) is exchanging hands for $211 and is up 51% YTD. The stock has been on a strong rally since the end of last year and I do not think this rally is going to slow down anytime soon. It is very close to the 52-week high of $217 and could keep moving upwards. 

A leader in the AI space, the semiconductor company has shown impressive financial performance in the recent results. Driven by the popular Snapdragon platform, the company reported a modest 1.2% YOY rise in revenue to $9.39 billion.

Its non-GAAP profit came in at $2.44 per share and the gross margin stood at 56.3%, up from 55.2% in the prior year. The profit margins have remained stable despite the economic uncertainty and as the smartphone market revives, Qualcomm is set to benefit. 

The company has been around for several decades and the growing popularity and demand of AI is going to benefit the stock. The management is aiming for a revenue jump of 8.9% YOY in this quarter. Its Snapdragon platform could continue to generate revenue for years to come.

Qualcomm has recently signed a deal with Microsoft  (NASDAQ:MSFT) to integrate AI chips for the surface PCs and this could boost the stock. It could also be a brand-new growth market for the company. Despite moving closer to the 52-week highs, Qualcomm stock offers great value. 

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

Vandita Jadeja is a CPA and a freelance financial copywriter who loves to read and write about stocks. She believes in buying and holding for long term gains. Her knowledge of words and numbers helps her write clear stock analysis.

Article printed from InvestorPlace Media, https://investorplace.com/2024/06/under-the-radar-3-ai-sleeper-stocks-to-own-now/.

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