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In a constantly evolving technological context, artificial intelligence (AI) is emerging as a major catalyst for economic and social transformation. Recent advances in this area suggest the emergence of new players on the global scene, likely to redefine the industrial landscape. However, faced with the multitude of investment options, it becomes crucial to identify opportunities with high potential. This article explores two stocks that, according to expert analysis, could soon capture the attention of billionaires, revealing key issues for informed investors.
The Artificial Intelligence Revolution
If the last 18 months have made you miss the meteoric rise of Nvidia, all is not lost in the field of artificial intelligence (AI). Other opportunities are on the horizon and some billionaire investors have already grasped their magnitude.
Amazon: A Multifaceted Approach to AI
In 2023, the action ofAmazon has already climbed by almost 30%, propelling the company’s capitalization beyond the threshold. 2 trillion dollars. Although the company is primarily known for its e-commerce platform, its involvement in AI is equally impressive.
Amazon uses AI to optimize its product recommendations, boost its Prime Video streaming platform, and particularly for its AI-heavy projects on Amazon Web Services (AWS).
Amazon has also designed its own data center chips, making it possible to train AI models at much lower costs than market-leading GPUs like those from Nvidia. The AWS Bedrock platform offers customers a choice of major language models (LLMs) pre-designed, making it easier to develop custom AI applications.
Recently, Amazon invested $4 billion in startup Anthropic, solidifying its strategic partnership and planning to make AWS Anthropic’s preferred cloud platform. This strategic move could encourage new developers to prefer AWS over its competitors like Microsoft Azure.
Oracle: State-of-the-art AI Data Center Infrastructure
As tech giants invest heavily in new data centers to satisfy the growing demand for computing capabilities from AI developers, Oracle is at the forefront with its state-of-the-art infrastructure.
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Oracle’s Supercluster technology allows developers to scale their projects up to 32,768 Nvidia GPUs, with a planned increase to 65,536. This type of scalability allows for the creation of more advanced and better AI models. By comparison, Amazon’s best AI infrastructures offer clusters of just 20,000 GPUs.
Another key innovation from Oracle is its RDMA (Random Direct Memory Access) networking technology, which accelerates data transfers between servers much faster than traditional Ethernet networks. This speed significantly reduces processing costs, a feature highly valued by AI developers.
Oracle is building new data centers to meet the surge in demands from big names like OpenAI, Cohere, and Elon Musk’s xAI. Oracle’s remaining performance commitments jumped 44% in one year, reaching a record $98 billion, with $12.5 billion dedicated to AI projects.
Despite this rapid growth, Oracle stock remains relatively cheap compared to its industry peers. It trades at a price/earnings ratio (P/E) of only 26, a reduction of 20% compared to the index Nasdaq-100, and significantly lower than Nvidia’s P/E of 76.
Investors who missed Nvidia’s incredible run still have great prospects to discover with Oracle. The rapid accumulation of actions by David Tepper’s Appaloosa is a vivid testimony to this.
