We recently compiled a list of the 10 Best Artificial Intelligence (AI) Stocks To Buy According to Financial Media. In this article, we are going to take a look at where ServiceNow, Inc. (NYSE:NOW) stands against the other artificial intelligence stocks recommended by financial media.
CEO Says AI is “Gonna Keep Providing Value”
Artificial Intelligence (AI) has now become a technology that most people are increasingly familiar with. With AI seeping into almost every aspect of life, from the ads you see on social media apps to the autonomous driving cars many consumers are shifting to. It’s not an overstatement to say that AI has become part and parcel of everyday life for every person using technology today. Considering the widespread use and application of AI technology, this area of the market has become an exciting area to invest in today.
With the recent big tech companies’ earnings being released, many investors are wondering what role AI is playing in the tech markets today, and how it will develop. On August 2, Databricks CEO Ali Ghodsi joined CNBC’s “The Exchange” to discuss this very development. Here are some of his comments:
“I think what’s happening is two things. On the one hand, it’s macroeconomy, which has been sort of turbulent for a long period of time, and it seems to be now coming to an end, where we see it on the job market and people are seeing it on inflation and the 10-year coming down and so on. On the other hand, we see AI. People are very excited, they know it’s gonna absolutely change the whole world, and that huge investments have been done by the hyperscalers in AI. But for us as a company, we’ve been investing in data and AI for the 10 years, and you know we see a steady growth revenue and customers getting value out of it, but theres been a huge deployment of capital… I think AI is gonna be amazing, it’s gonna keep providing value.”
Ghodsi’s comments clarify the market’s current opinion on AI, namely that this is an area of tech that cannot be ignored and must be invested in to the maximum. However, in light of such a market opinion, many investors may be beginning to wonder whether the huge amounts of investments being made in AI are justified or whether we are merely in what some may call an “AI bubble” that is definitely going to burst. Considering the immense value to be found in AI, though, many investors believe that such huge deployments of capital are, in fact, justified.
West Coast’s Smartphone Giant: AI Stock or Not?
Considering the above, it’s unsurprising that several big tech companies are part of the rat race to invest in and develop AI technologies. However, one notable absence in most lists of the best AI stocks to buy that are being made by financial media reporters is that of Apple. Many investors are beginning to take note of the fact that it is lagging behind other big tech companies that are rapidly developing AI tech. On August 6, Lightshed Partners’ Walter Piecyk’s shared his view on the smartphone maker’s AI moves on CNBC’s “Squawk Box”.
“I signed up as a developer for the latest development or the latest release of iOS 18. I’ve been using the intelligent series – not that much better… There’s a lot of work that’s obviously gonna be done between now and when this is formally released. I just don’t see it, for this year and for next year having some a big impact.”
Investors may be better served by shifting to purer AI plays. For this reason, we have compiled a list of the best AI stocks to buy according to financial media, to offer insights into what companies are actually doing well in the AI space today. Our list includes some of the best AI stocks to buy, according to analysts, and some of the companies offering the top AI SEO tools in 2024 as well.
Our Methodology
We selected AI stocks that made the top AI stocks lists of various financial news reporters, such as Forbes, Motley Fool, Nasdaq, US News, and NerdWallet. We then shortlisted and ranked the stocks based on the number of hedge funds holding stakes in them, from the lowest to the highest, by using Insider Monkey’s hedge fund data for the first quarter of 2024.
Why are we interested in the stocks that hedge funds pile into? The reason is simple: our research has shown that we can outperform the market by imitating the top stock picks of the best hedge funds. Our quarterly newsletter’s strategy selects 14 small-cap and large-cap stocks every quarter and has returned 275% since May 2014, beating its benchmark by 150 percentage points. (see more details here).
A team of software engineers at desks working on code for a cutting-edge cloud computing solution.
ServiceNow, Inc. (NYSE:NOW)
Number of Hedge Fund Holders: 90
ServiceNow, Inc. (NYSE:NOW) is a systems software company based in Santa Clara, California. Over the past three years, the company has seen good EPS growth, with analysts expecting it to continue with growth of 20.9% over 2025. According to Forbes, ServiceNow, Inc. (NYSE:NOW) is a rare growth stock with the tendency to trade cheaply, making it a potentially lucrative and attractive investment for growth investors. The company should also be considered in light of its growing influence in the Asia-Pacific region, with a strong focus on leveraging AI to help various organizations orchestrate business processes across business functions. ServiceNow, Inc. (NYSE:NOW) is particularly emphasizing generative AI to help its customers streamline workflows and processes.
We saw 90 hedge funds long ServiceNow, Inc. (NYSE:NOW) in the first quarter, with a total stake value of $6.2 billion.
Overall NOW ranks 9th on our list of the best artificial intelligence stocks to buy according to financial media. You can visit 10 Best Artificial Intelligence (AI) Stocks To Buy According to Financial Media to see the other artificial intelligence stocks that are on hedge funds’ radar. While we acknowledge the potential for NOW as an investment, our conviction lies in the belief that AI stocks hold greater promise for delivering higher returns, and doing so within a shorter timeframe. If you are looking for an AI stock that is more promising than NOW but that trades at less than 5 times its earnings, check out our report about the cheapest AI stock.
READ NEXT: Analyst Sees a New $25 Billion “Opportunity” for NVIDIA and Jim Cramer is Recommending These 10 Stocks in June.
Disclosure: None. This article is originally published at Insider Monkey.