2 Magnificent Artificial Intelligence (AI) Stocks to Buy in May and 1 to Avoid
From Nasdaq: 2025-05-05 03:51:00
In 2024 and early 2025, artificial intelligence (AI) has been a major catalyst for the stock market’s rise, with the potential for software and systems to reason and act on their own. AI’s global market is projected to reach $15.7 trillion by 2030, with two standout AI stocks to consider, while one may be overvalued.
Alphabet, parent company of Google, is a top AI stock to watch, with a strong foundation in internet search and a growing AI-driven cloud infrastructure service platform. The company’s robust cash position and low valuation make it an attractive investment opportunity, trading at a discount compared to historical averages.
Baidu, China’s leading AI-powered tech stock, has a core business in online advertising and a growing non-online marketing segment, driven by AI Cloud revenue and its autonomous driving company, Apollo Go. With a strong cash position and historically low valuation, Baidu presents a compelling investment case despite trade tensions.
On the other hand, Palantir Technologies, a provider of AI-fueled software solutions, may be a stock to avoid in May due to potential headwinds. While the company has shown strong sales growth and irreplaceable services, uncertainties surrounding defense spending, market bubbles, and an inflated valuation suggest caution for investors.
Consider joining the Motley Fool Stock Advisor for insights on the 10 best stocks to buy now, excluding Alphabet. With a history of market-crushing returns and expert recommendations, investors can access valuable insights to make informed decisions. It’s essential to evaluate all factors before investing in AI stocks like Alphabet and Baidu for long-term growth and stability.
Read more at Nasdaq: 2 Magnificent Artificial Intelligence (AI) Stocks to Buy in May and 1 to Avoid