Since the coronavirus bloodbath began in March, economies across the globe are in various stages of lockdown. With the U.S. stock market on a rollercoaster ride, technology stocks are keeping the indexes high.
In fact, technology companies, which are helping organizations and individuals cope with stay-at-home and work-from-home orders, are booming. At this hour, the need for automation and efficient use of data has boosted AI, which was already a promising industry.
AI May Outpace Traditional Practices
Remote working is the new normal now. AI has moved on from Internet search to some big changes like cloud and productivity boosters. Public cloud leaders Amazon Web Services, Microsoft Azure and Google Cloud have seen significant growth in just months.
Google Cloud has raked in $2.78 billion in the first quarter of 2020, showing a massive 52% year-over-year increase. The segment, which was earlier a minor part of the company,made up nearly 7% of the top line in the first quarter.
Organizations are now looking to adapt to the digital era and AI companies are propelling digital transformation. This is because a suite of software helps organizations with all aspects of customer relationship and data management. These software cover sales, service, marketing, and data management services. The AI-based insight givesusers instant actionable items to help in decision making and deliver a better experience to customers.
Moreover, AI has the power to liberate human time to help them focus on higher-order activities and rational decision making.
Big data and AIare becoming integral part of business driven by the availability of data from sources like IoT. Coupling with machine learning, these can easily collect and handle big data. And AI’s applications in real-time functions like cloud, autonomous robots, and facial analysis are fueling growth. In fact, AI can deliver services to banking and finance, healthcare, manufacturing, retail, e-commerce, telecommunication, marketing and sales, and education sectors.
What’s more? AI finds wide application ranging from material science to medical research and climate science. For instance, researchers at Geisinger have developed an algorithm that could reduce intracranial hemorrhaging by up to 96% during diagnosis. Meanwhile, researchers from the Montreal Institute for Learning Algorithms use GANs (generative adversarial networks) to simulate the damage of severe storms and rising sea levels, and educate and predict the impacts of climate change.
5 Stocks to Buy
At present AI is also helping with research on coronavirus vaccine. AI-powered by deep-learning algorithms has been in use in the healthcare for a decade now. Recently, GE Healthcare announced a suite of AI algorithms intended to lessen the clinical strain caused by coronavirus. The company’s eight algorithms from Lunit INSIGHT CXR are capable of analyzing chest x-rays to find abnormalities such as tuberculosis, lung nodules and pneumonia, which are indicators of COVID-19 and a key cause of mortality in coronavirus patients.
Per a MarketsandMarkets forecast, the AI market was valued at $21.46 billion in 2018 and is likely to reach $190.61 billion by 2025, at a CAGR of 36.62%. In fact, major drivers for the AI market are growing use of big data, the increasing adoption of cloud-based applications and services, and rising demand for intelligent virtual assistants.
Given the encouraging factors, we have shortlisted five stocks that could enjoy the boom.
Dropbox, Inc. DBX provides a collaboration platform. The company’s expected earnings growth rate for the current quarter is 70% against the Zacks Internet - Services industry’s projected earnings decline of 16.3%. The Zacks Consensus Estimate for its current-year earnings has moved up 8.6% over the past 60 days. Dropbox sports a Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.
The Trade Desk, Inc. TTD operates a self-service cloud-based platform that allows buyers to create, manage, and optimize data-driven digital advertising campaigns. The company’s expected earnings growth rate for the next year is 30.6% compared with the Zacks Internet - Services industry’s projected earnings growth of 23%. The Zacks Consensus Estimate for its current-year earnings has moved up 2.8% over the past 60 days. The Trade Desk holds a Zacks Rank #2 (Buy).
AudioEye, Inc. AEYE provides web accessibility solutions to Internet, print, broadcast and other media. The company’s expected earnings growth rate for the current quarter is 33.3% compared with the Zacks Internet - Software industry’s projected earnings growth of 23.1%. The Zacks Consensus Estimate for its current-year earnings has moved up 2.9% over the past 60 days. AudioEyecarries a Zacks Rank #2.
NVIDIA Corporation NVDA operates as a visual computing company. Its CUDA GPU programming language plays a role in AI technology. The company’s expected earnings growth rate for the current year is 36.4% against the Zacks Semiconductor - General industry’s projected earnings decline of 14.3%. The Zacks Consensus Estimate for its current-year earnings has climbed3.8% over the past 60 days. NVIDIA holds a Zacks Rank #2.
Micron Technology, Inc. MU provides an easy-to-use software programmable platform that supports a broad range of machine learning frameworks. The company belongs to the Zacks Semiconductor Memory industry and has an expected earnings growth rate of 33.9% for the next year. The Zacks Consensus Estimate for its current-year earnings has risen 15.4% over the past 60 days. Micron Technology holds a Zacks Rank #2.
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