When most investors think of artificial intelligence stocks come to mind — and well they should.
Nvidia’s graphics processing hardware has proven an ideal way to complete the intensive number-crunching required by most AI applications, and Microsoft has arguably acquired a number of artificial intelligence companies, garnering some new and impressive technologies it has yet to turn into a practical product. Those products are in the works, though.
Many more organizations have waded into artificial intelligence waters, however — more than you might realize. A bunch of them are smaller and, perhaps, even unknown names. That doesn’t make them inferior AI stocks, however. Indeed, many of these unknown names rank among the best artificial intelligence stocks available to investors today.
With that as the backdrop, here’s a run-down of three AI names you may not have realized were artificial intelligence plays — if you realized they existed at all.
Hot Tech Stocks To Watch Right Now: NVIDIA Corporation(NVDA)
INTC stock is up 45% over the past 12 months. MU stock is up 70%.
But even those huge gains pale in comparison to the gains made by NVIDIA Corporation(NASDAQ:NVDA) over the past year. During that stretch, NVDA stock has risen by more than 140%.
That is especially impressive considering NVDA is among the biggest in the group, meaning these huge gains have come from a big base.
As such, it is easy to tell that a lot of things have gone right for NVDA. Remember all those secular growth markets that are creating robust demand in the semiconductor space (data-centers, AI, IoT, and automation)? NVDA is the king in each of those markets, and the company’s leadership position appears to be only strengthening as the markets get bigger.
As such, NVDA stock should be able to stay hot.
That said, valuation is a concern for this stock. NVDA stock trades at 40-times this year’s projected earnings. That is a much bigger valuation than is normal for a chip stock.
But NVDA also deserves this huge multiple. Revenues have grown by around 40% per year over the past 2 years, and are expected to rise another nearly 30% this year. Meanwhile, margins are powering higher, and earnings are expected to rise 30% this year and more than 15% next year.
Thus, the 40-times forward multiple feels rich, but not unnecessary. There may be some near-term turbulence in the stock as fundamentals catch up to the stock price, but overall, this chip stock should head significantly higher in a long-term window.
Hot Tech Stocks To Watch Right Now: Grupo Supervielle S.A. (SUPV)
Grupo Supervielle SA (NYSE:SUPV) based in Buenos Aires, Argentina, the company is a private domestically-owned financial group primarily in Argentina. The company owns Banco Supervielle S.A., an Argentine private domestically-owned bank.
Grupo Supervielle has expected earnings growth of 27.7% for current year. The Zacks Consensus Estimate for the current year has improved by 4.3% over the last 60 days.
Hot Tech Stocks To Watch Right Now: Mellanox Technologies, Ltd.(MLNX)
You may not have heard of chip maker Mellanox Technologies, Ltd. (NASDAQ:MLNX) — but in the last six months this “strong buy” stock has jumped by 77%. What’s more, there is still plenty of upside potential left! Mellanox is a leading supplier of computer networking products using InfiniBand and Ethernet technology. The stock is buzzing after the company positively pre-announced first quarter earning results. Most notably, midpoint of revenue guidance increasing by $18 million, or 8%, to $245 million.
On the news, top Loop Capital analyst James Kisner boosted his MLNX price target from $80 to $90. The new price target suggests 28% upside potential from current levels. For Kisner, MLNX stands to benefit from 1) the adoption of high-speed Ethernet network interface cards and 2) switches by hyperscale internet/Web 2.0 companies.
Most interestingly, Kisner isn’t concerned about the company’s activist spat. On the contrary, he sees the involvement of Starboard Value LP as a positive catalyst that could lead to a company sale or operating improvements. Starboard owns 10.6% of Mellanox shares and is currently pushing to take over the board of directors.
Hot Tech Stocks To Watch Right Now: Equinix Inc.(EQIX)
Equinix Inc (NASDAQ:EQIX) connects businesses to their customers, employees and partners via data centers.
The company’s top-line reached $4,368 million as of its latest fiscal year, up 131.5% from fiscal year December 2012. Over that time period, Equinix’s revenue growth has ranged from 11.5% to 32.5%.
Wall Street analysts estimate that Equinix’s total revenue will continue to grow at an annual rate of 10.1% over the next five years.
Equinix’s stock currently trades at $414.48 per share as of Tuesday, up 9.4% over the last year. On a fundamental basis, the company’s stock is trading at a 7.0% discount to finbox.io’s intrinsic value estimate.
Hot Tech Stocks To Watch Right Now: Camtek Ltd.(CAMT)
Camtek Ltd. (NASDAQ:CAMT) is a developer of automatic optical inspection systems that are used to enhance both production processes and yield for manufacturers in the circuit board and semiconductor industries.
After posting better-than-expected earnings results last week, CAMT has moved to a Zacks Rank #2 (Buy), and its resulting share price surge has earned it an “A” grade for Momentum in our Style Scores system.
Camtek is also an exciting growth pick, with EPS figures expected to improve by 81.5% in the current fiscal year and an additional 25.5% in 2019. Still, the stock is trading with a Forward P/E of just 16.1 and a P/S of 2.8—so its valuation is hardly stretched considering its rapid expansion opportunities.