As an investor, I focus on holding onto stocks that will perform well over the long term. For me, three stocks stand out as having the potential to be held forever – even if their value fluctuates in the short term. These companies are leaders in artificial intelligence (AI) and are poised to benefit from the massive technological shift underway.
Amazon Web Services (AWS) is a key player in cloud computing, providing computing power for businesses to host websites, process data, or train AI models. With 50% of Amazon’s operating income coming from AWS, despite accounting for just 15% of its revenue, this stock has tremendous growth potential. Cloud computing is expected to grow at an annualized rate of 21% by 2030, making Amazon well-positioned to take advantage of this trend.
Alphabet’s (Google) investment in AI is another area of focus. With a legacy business generating massive amounts of money from advertising, Alphabet has also made significant investments in AI research and development. Its Gemini generative AI model has become a top performer in the space, and with shares trading at a bargain valuation of 20.6 times expected forward earnings, this stock is looking like a good deal now.
Lastly, Taiwan Semiconductor Manufacturing (TSM) dominates the chip foundry market, making it an essential player in the AI arms race. With expectations of compound annual revenue growth rate exceeding 20% over the next five years, TSMC’s financial results are being driven by this massive demand for more technologically advanced chips.
While some may be hesitant to invest due to concerns about market volatility, I believe these stocks have the potential for long-term success and should be considered for a buy-and-hold strategy.
Source: https://finance.yahoo.com/news/3-artificial-intelligence-ai-stocks-161600167.html