Relying on advanced pattern recognition and inferencing techniques, speech recognition, recommendation systems and autonomous vehicles have all become possible. Large language models (LLMs) like OpenAI’s ChatGPT are other examples. They show that ML can be leveraged to generate human-like text, code, images, or video. ML’s integral role in enabling generative artificial intelligence (AI) has made investors keen on publicly traded companies. Those have made significant strides in advancing the technology.
Therefore, let’s explore three machine learning stocks that investors should buy now before they regret it.
Microsoft (MSFT)
The software giant Microsoft (NASDAQ:MSFT) has been key to developing machine learning technologies. In the race to develop the most advanced AI products, Microsoft invested $1 billion into OpenAI way back in 2019.
Successive rounds have seen the software firm’s investment balloon from $1 billion to more than $13 billion. Early in 2024, OpenAI sought out more equity investors in a well-covered equity fundraising round. And at the end, the ChatGPT creator had a valuation of $89 billion.
Outside of ChatGPT, Microsoft has been developing its own generative AI models that use ML as their operational crux. Microsoft’s Copilot is not just chatbot embedded within a browser. The software giant has committed to deepening the LLMs access to all other facets of the Microsoft ecosystem. This includes Microsoft 365 and Azure, enabling powerful efficiencies for a variety of enterprises.
Currently the most valuable company in the world, Microsoft’s share price has risen more than 20% since January. Furthermore, its cloud unit’s strong performance is due to AI processing power demand. Thus, MSFT will likely see its shares increase even more.
Alphabet (GOOG,GOOGL)
The parent company of Google, Alphabet (NASDAQ:GOOG,NASDAQ:GOOGL) has also been a key investor in ML technologies. Since its incorporation, Google has been selling itself as an AI business. Real use-cases for machine learning appeared in Google Search. The company leveraged those algorithms to “suggest better spellings to users searching the web,” according to its fiscal year 2023 SEC 10K filing. Between the years of 2017 and 2017, Google CEO Sundar Pichai made announcements regarding the tech firm’s strategic shift. It went from being “mobile-first” to “AI-first.” Thiss meant employing ML algorithms throughout all the company’s key products.
Nowadays, Google’s large language model Gemini has absorbed much of the spotlight. And similar to Microsoft’s Copilot, it has been integrated into all kinds of Google products. Google Cloud is another business that has leveraged its cloud computing power to help businesses write and implement ML algorithms and LLMs.
GOOG has risen 31.8% year-to-date (YTD). Yet, its trading valuation is amongst the lowest of the major tech giants, making an enticing opportunity for potential long-term investors.
Meta Platforms (META)
Meta Platforms (NASDAQ:META), formally known as “Facebook,” is an important player in the internet sector. It has built and managed large social media platforms, including Facebook, Instagram and WhatsApp.
The use of machine learning and commitment to developing AI technologies started over a decade ago at the social media giant. META has also helped developed various research centers and clusters to enable greater scientific collaboration on the development of machine learning algorithms. The AI Research Supercluster is a supercomputer that the tech company developed to pave the way for AI research on advanced LLMs.
Moreover, Meta Platforms has developed a special LLM named Llama that the company has already begun embedding into its various social media platforms. “Meta AI,” which uses Llama, will likely help to drive user growth on a going-forward basis due to its utility and functionality.
Also, META shares have rallied in 2024, so far having risen 44.5%, and similar to Alphabet, Meta Platforms is not boasting a hefty valuation either. The social giant’s valuation sits at 25.0x forward earnings.
On the date of publication, Tyrik Torres did not have (either directly or indirectly) any positions in the securities mentioned in this article. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.com Publishing Guidelines.
Tyrik Torres has been studying and participating in financial markets since he was in college, and he has particular passion for helping people understand complex systems. His areas of expertise are semiconductor and enterprise software equities. He has work experience in both investing (public and private markets) and investment banking.