Ever since OpenAI released the artificial intelligence (AI) chatbot ChatGPT back in November 2022, companies have raced to develop their own AI products.

• Microsoft Corporation (MSFT) partnered with OpenAI and plans to use the latter company’s GPT-4 technology for its products, like its search engine Bing…
• Alphabet Inc. (GOOG) is creating its own AI chatbot, called Bard…
• And TikTok is testing an AI chatbot, named Tako.

This week, though, another company announced that it is entering the AI race: Apple Inc. (AAPL).

On Wednesday, Bloomberg reported that Apple is working on its own generative AI tool, similar to ChatGPT and Bard. Remember that generative AI is a type of artificial intelligence algorithm that generates a new output, like a text or image, based on examples it’s been given.

Apple is no stranger to integrating AI into its products. You may already be a user of its core AI product, voice assistant Siri.

Siri is a form of narrow AI, which means its capabilities are limited. It is meant to complete simple tasks, like setting reminders. However, Apple’s newest AI endeavor is a large language model (LLM) service.

So, in today’s Market 360, let’s take a look at what some Apple engineers are calling “Apple GPT”. Then, I’ll reveal where to find the best AI stocks.

Apple Announces Ajax

Ajax is no longer just the name of a Greek mythological hero: It is now the name of Apple’s developing AI chatbot.

According to Bloomberg, Ajax was “created as an experiment at the end of last year by a tiny engineering team” and was meant to “unify machine learning development at Apple.” Basically, Ajax will serve as the foundation for the internal ChatGPT-style tool at the company. It is built on top of Google Jax, which is a framework developed by Google for machine learning.

Just like ChatGPT and Bard, Ajax helps to answer questions and summarize texts based on information that it has been trained with.

The AI chatbot is accessible through a web application, but it isn’t available to the public. In fact, as Bloomberg also states, “Any output from it can’t be used to develop features bound for customers.”

So, currently, Apple has no plan to release Ajax to consumers.

Instead, the company is planning on hiring more experts in generative AI. An advertisement on Apple’s website states that the company is looking for engineers with a “robust understanding of large language models and generative AI.” The company also states that it wants to apply LLM technology to the way that “people communicate, create, connect and consume media” on its own devices, like the popular iPhone.

Apple CEO Tim Cook said that he believes LMM technology to have “great promise.” However, during a conference call in May, he said that there are still a “number of issues that need to be sorted.” He has warned about the possibility of misinformation and response bias, both problems faced by ChatGPT and Bard. So, the addition of AI into Apple’s products will be done, according to Cook, on a “very thoughtful basis.”

While Apple does not have a plan in place for the current AI technology it is developing, it is believed to make a significant AI-related announcement next year.

Shares of Apple popped briefly on Wednesday after Bloomberg reported about Ajax. The stock ended the trading day up less than 1%. Shares of Microsoft, Alphabet and NVIDIA Corporation (NVDA) dropped more than 1% after the report.

The Hunt for the Best AI Picks

In my Portfolio Grader, Apple currently has a B-rating, making it a “Buy.”

Likewise, its Quantitative Grade, which accounts for about 70% of a stock’s Total Grade and measures a company’s institutional buying pressure, also sits at a B-rating. You can think of this as “following the money.” The more money that floods into a stock, the more momentum a stock has to rise.

But, the fact is, Apple is just the beginning…

AI is one of the fastest growing trends right now – and companies big and small are trying to stake their claim as leaders.

That’s why my colleagues Luke Lango, Eric Fry and I are getting together next week for a special AI Impact Event.

We are sitting down on Thursday, July 27, at 7 p.m. Eastern time to talk about everything AI – the winners (and losers) – and how you can come out on top.

Folks, this is an event you won’t want to miss.

To make sure you reserve your seat to our AI Impact Event, click here.

Sincerely,

Louis Navellier

The Editor hereby discloses that as of the date of this email, the Editor, directly or indirectly, owns the following securities that are the subject of the commentary, analysis, opinions, advice, or recommendations in, or which are otherwise mentioned in, the essay set forth below:

NVIDIA Corporation (NVDA)