Artificial intelligence (AI) has revolutionized the market in recent years, with stocks like NVIDIA and OpenAI stealing the spotlight. However, amidst all the excitement, there are some hidden gems that have not received the attention they deserve. In this article, we will explore two underrated AI stocks with tremendous potential in 2024: OpenText and Adobe.
OpenText, a Canadian AI stock, offers a value proposition that sets it apart from the industry giants. Despite its vast capabilities in information management, the stock trades at just 10.05 times earnings and 2.7 times book value, making it an attractive option for investors. OpenText utilizes AI in text analytics, harnessing the power of “large language models” to enhance content creation. Its Cloud Editions enable users to generate content efficiently by incorporating AI to suggest sentences. With such compelling AI use cases, OpenText has experienced an impressive 418% rise in its stock value over the years. Moreover, the company boasts a dividend yield of 2.45% and a remarkable track record of 25 consecutive years of dividend raises, solidifying its position as a Dividend King.
Another hidden gem in the AI market is Adobe. Renowned for its Adobe Creative Cloud suite, Adobe offers an extensive range of applications for various creative needs. Its recent addition of Adobe Firefly, an AI-based image generation tool, further enhances the user experience. For a monthly subscription fee of just $38, customers gain access not only to exceptional creative applications like Photoshop and Illustrator but also to 20 gigabytes of Cloud hosting. With consistent revenue growth of 17% and a strong net income and earnings per share surge, Adobe has proven its ability to adapt and thrive in the ever-evolving tech industry. As Adobe continues to leverage AI and expand its product offerings, the potential for future growth becomes even greater.
The AI market’s exponential growth shows no signs of slowing down. OpenText and Adobe, with their innovative approaches to incorporating AI into their product portfolios, are well-positioned to ride this wave of success. While the giants of the industry dominate the headlines, these two underrated stocks offer investors the opportunity to join the AI revolution at reasonable prices. As the world becomes increasingly reliant on AI technology, OpenText and Adobe are poised to play significant roles in shaping the future.
FAQ
Q: What are the two underrated AI stocks mentioned in the article?
A: The two underrated AI stocks mentioned in the article are OpenText and Adobe.
Q: What sets OpenText apart from industry giants?
A: OpenText offers a value proposition that sets it apart from industry giants. It trades at just 10.05 times earnings and 2.7 times book value, making it an attractive option for investors.
Q: How does OpenText utilize AI?
A: OpenText utilizes AI in text analytics, harnessing the power of “large language models” to enhance content creation. Its Cloud Editions enable users to generate content efficiently by incorporating AI to suggest sentences.
Q: What is the stock value rise that OpenText has experienced over the years?
A: OpenText has experienced an impressive 418% rise in its stock value over the years.
Q: What is Adobe known for?
A: Adobe is renowned for its Adobe Creative Cloud suite, which offers an extensive range of applications for various creative needs.
Q: What recent AI-based tool has Adobe introduced?
A: Adobe has recently introduced Adobe Firefly, an AI-based image generation tool, which enhances the user experience.
Q: What are the key financial indicators for Adobe?
A: Adobe has consistent revenue growth of 17% and a strong net income and earnings per share surge.
Q: What is the potential for future growth for OpenText and Adobe?
A: As the AI market continues to grow exponentially, OpenText and Adobe, with their innovative approaches to incorporating AI, are well-positioned for future growth.
Definitions
AI: Artificial intelligence – refers to the development of machines that can perform tasks that would typically require human intelligence.
Stocks: Shares of ownership in a company that represent a claim on its assets and earnings.
Book value: The value of a company’s assets minus its liabilities, as listed on its balance sheet.
Dividend yield: The ratio of a company’s annual dividend payment to its stock price.
Subscription fee: An ongoing payment made by a customer to access a service or product on a regular basis.
Net income: The total revenue minus all expenses, taxes, and interest paid.
Earnings per share: The portion of a company’s profit allocated to each outstanding share of common stock.
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