Artificial intelligence stocks & ETFs to watch

Nvidia is the inventor and world’s top producer of graphic processing units (GPUs) which are used for AI’s deep learning, controlling over 80% of the market in 2021, according to JPR. It provides GPUs for the gaming, automotive and mobile computing markets, as well as selling to data centres that carry out AI and machine learning tasks. Alphabet, Microsoft and Amazon are three of the largest tech giants that use Nvidia’s products to power their AI services. In particular, demand for the company’s computing solutions has been rising over recent years, as well as the use of GPUs for cryptocurrency mining, which saw a rally throughout 2020.

C3.ai can be described as a pure-play AI company that dabbles in both the AI and SaaS markets. It develops cloud-based software for the operation of AI applications, accelerating digital transformation for its customers, which include blue-chip stocks such as Royal Dutch Shell, 3M and Engie. Customers can use the C3 AI suite for predictive maintenance and monitoring of equipment, which has been shown to improve safety and extend the life of company assets. Despite only going public in December 2020, the company has estimated that its addressable market could expand from $170bn in 2020 to $270bn in 2024. It has also seen increasing revenues throughout 2021.

Palantir specialises in data analytics to help organisations around the world to integrate data, make decisions and improve operations. The company operates in a number of markets including financial services, technology, defense and healthcare, where it operates two main platforms: Gotham and Foundry. These serve both governmental agencies such as the CIA, and large enterprises such as Merck and Rio Tinto, via the integration of software solutions using AI and machine learning. Since having its IPO in September 2020, the company’s share price has risen by over 170% and the company expects its revenues to grow at least 30% on an annual basis from 2021 onwards.

Micron has a broad portfolio of products, offering memory and storage technologies that turn information into intelligence, including dynamic random-access memory (DRAM), flash memory (NOR) and USB flash drives. It is a leader in the semiconductor industry, producing silicon-to-semiconductor solutions for the cloud server, enterprise, graphics and networking markets. Among some of Micron’s most well-known clients are tech companies such as HP, Intel and Kingston. In 2019, the company acquired AI software and hardware start-up Fwdnxt, where it is planning to combine both companies to explore deep learning AI solutions for data analysis. If successful, this could bring Micron into direct competition with other rivals on this list.

Alphabet is the parent company of the world’s largest search engine, Google. Although it is perhaps best-known for Google’s services, the company also has a number of fully owned ventures that focus on artificial intelligence, robotics and machine learning. Examples of subsidiaries within relevant fields include DeepMind, Nest, and Waymo. The business uses artificial intelligence for Google’s algorithms, and it is transitioning into the EV market for self-driving car technologies. Alphabet’s own ventures are specifically focused on AI enablers. The company is also a leading cloud provider, controlling over 7% of the growing market.

International Business Machines (IBM) is a tech giant that provides services in the fields of cloud architecture, IT infrastructure and enterprise security, as well as offering AI-powered solutions. According to Analytics Insight, IBM has a market share of around 10% within the artificial intelligence industry. Some of its relevant projects include building the Summit supercomputer (the second-fastest in the world), offering hybrid cloud solutions based on blockchain technology, and creating the IBM Watson data analytics processor that analyses human language and speech. IBM announced a partnership with Palantir in early 2021, which will combine the capabilities of both companies to integrate and analyse large amounts of data within the healthcare, financial services and telecommunications sectors.

This ETF seeks to invest in companies that may benefit from an increased utilisation of AI technology, including those involved with industrial robotics and automation, non-industrial robots, and autonomous vehicles. The fund has over 35 holdings, including Nvidia, Upstart, and Keyence, giving investors global exposure to multiple and sectors and industries.

This ETF seeks long-term growth of capital by investing in equities involved in the development and production of robotics and automation, autonomous transportation, space exploration, 3D printing, and energy storage. The fund’s investment theme is ‘disruptive innovation’, with top-weighted holdings that include Tesla, UiPath, Trimble, and Lockheed Martin.

This ETF seeks to provide exposure to an index that tracks companies influencing the future of technology, including AI, fintech, robotics, autonomous and electric vehicles, and virtual/augmented reality. These are mainly US-based companies but also from Japan, South Korea and China. Top-weighted holdings of the fund include Snap, Baidu, and Harmonic Drive Systems.

This ETF provides exposure to an equal-weighted index composed of global companies across the robotics and AI value chain. It seeks long-term growth of companies that are shaping the global economic future, including HubSpot, Snowflake, Ambarella, and Teradata.