Artificial intelligence and its subset machine learning is the next big thing in information technology.
How to invest in artificial intelligence on the stock market? The most directly related to artificial intelligence companies traded on US stock markets are chip producers like Intel Corporation, Advanced Micro Devices, Inc. and NVIDIA Corporation. Artificial intelligence and its application machine learning basically is a string of algorithms or with other words said computer calculations.
Intel went close to its dot-com peak recently, while Advanced Micro Devices currently surpasses its dot-com era high point of its stock price. NVIDIA has been a stock market darling in the recent decade as its graphics processing units have been deemed by the market as the most suitable for the intensive computations related to artificial intelligence and machine learning.
Currently, I estimate that Advanced Micro Devices and NVIDIA Corporation are currently overvalued by respectively circa 30% and 40% by public markets. Intel Corporation is more mildly overvalued, according to my opinion, by circa 10%.
The expected growth priced in the stock market valuations of Advanced Micro Devices, NVIDIA Corporation and Intel Corporation is simply too high and it is very doubtful it will come to fruition.
Yes, artificial intelligence is the global technology disruptor of our lifetime, most likely. But as in the dot-com boom the prices of stocks related to artificial intelligence have just run up too high too fast. Yes, in the future they well be worth even more, but for now Advanced Micro Devices, NVIDIA Corporation and Intel Corporation look overvalued.
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Petar
Vladimirov Posledovich is not liable for any investment losses incurred
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Conflicts of interest: I may possess some of the securities, currencies or their derivatives mentioned in the blogpost and posts on social networks(Twitter, LinkedIn etc.)!
Respectfully yours,
Petar Posledovich
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