The Road to $1 Million: 3 AI Stocks to Protect Your Financial Future

These days, AI stocks are almost selling like hotcakes, and I can’t blame the investors. With almost every tech company and tech giant announcing the integration of artificial intelligence into their business processes, AI service providers are gaining more and more customers. .

At the same time, SaaS companies are adding GPT to their existing platforms, allowing them to expand their offerings and earn more money. Indeed, the AI ​​trend is completely stable, and everyone is eager to ride it to the top.

However, we will not buy from every company that has a “artificial science” stamp on their products. Trends live and die all the time – and so does AI – but companies with solid operational foundations will always outlast the trend that found them in the spotlight. Therefore, investors must be more selective when choosing AI stocks, even if everyone seems to be buying them out of hand.

So, today, I will discuss three stocks that seem to have what it takes to succeed. To find this list, I analyzed the market using the following data:

• Inspector’s details: At least they “buy.”
• Auditor matters: Minimum of 12 analysts dealing with the stock.
• Income growth: Good growth last year.
• An increase in income: At least 10% in the last two years.

Now, I’ve taken the top three based on revenue growth in their most recent financial year and I’ll rank them from number one. Here are the results:

ServiceNow (NOW)

ServiceNow (NYSE:NOW) provides a 360-degree platform that allows businesses to automate tasks and help monitor, automate and process. Its platform can be used in a variety of industries, including education, government, energy, utilities, financial services and healthcare.

To further enhance its offering, ServiceNow customers now have access to AI-powered Now Assist, which it says is suitable for “every workflow.” The service is operated by Microsoft’s (NASDAQ:MSFT) Co-Pilot and can be used for summarizing, content creation, coding and data analytics, among other things.

By 2023, ServiceNow began reaping the benefits of its AI investment. Revenue increased by 24% year-on-year (YOY), due to growth in subscription business. Contracts over $1 million also increased 33% YOY, as the company finished the year with a 99% renewal rate. In the end, earnings grew exponentially by 427%.

Moreover, its Q2 2024 report shows that it still has gas in the tank. ServiceNow exceeded its revenue and profit guidance, which led to its full-year subscription growth from 20.5% to 22% on the high end. CEO Bill McDermott said:

“Our importance as an AI platform for business transformation is stronger than ever as CEOs look for new vectors of growth, simplification and digitization. ServiceNow aims to reinvent every job function, in every company, in every industry, with GenAI at the forefront.”

Its AI partnerships and global expansion efforts have earned it a “strong buy” rating from Wall Street analysts, ranking it as one of the top stocks for major growth in the period coming.

Palo Alto Networks (PANW)

Palo Alto Networks (NASDAQ:PANW) is a leader in operational technology security solutions. The company has adopted AI to improve its security products, using its Precision AI, which uses machine learning and deep learning to help with cybersecurity.

In 2023, Palo Alto Networks revenue increased 25% YOY, rising from $5.5 billion to $6.9 billion. Additionally, the company turned last year’s loss of 90 cents per share into a profit of $1.45, a 261% improvement.

Good financial performance and expert approval make Palo Alto Networks one of the best AI stocks you can think of right now. Wall Street analysts agree that the consensus estimate for PANW stock is “strong value.”

Day (DAY)

Solar energy (NYSE:DAY) is a software company that provides solutions for people management needs. These requirements include payroll, staffing, benefits tracking and other business-related processes.

Some of the company’s software products include:

• Powerpay: Cloud HR and payroll solutions for the Canadian small business market.
• Day Workers: Provides internal storage of HR related records.
• Day Labor Management: It helps organize employees by organizing the system to meet the rules and policies of heavy work and working time.
• Dayforce Wallet: A digital payment solution that gives employees access to their salaries instantly.

More importantly, Dayforce recently launched Dayforce Co-Pilot, an AI-driven hub for human resources. Its functionality can be divided into three parts: Answer and Summarize (Questions & Features), Create and Refine (generate job descriptions, performance reviews and knowledge base topics) and Automate and Nudge ( report generation, automated scheduling, analytics and payroll).

In 2023, Dayforce reported a profit of 35 cents a share, an improvement of 173% YOY. Revenue also rose 21.5% YOY to $1.5 billion, with recurring revenue growing 36.3%.

The company’s 2024 guidance reflects this improvement. Taxes are expected to end up somewhere around $1.73 billion – an increase of 15% YOY. As a result, it’s no surprise that DAY stock has a consensus of “strong buy” from 16 analysts.

On the day of the announcement, Rick Orford held a long position in NOW. The opinions expressed in this article are those of the author, in accordance with InvestorPlace.com Publishing Guidelines.

On the date of publication, the responsible editor did not have (either directly or indirectly) any conditions of compensation mentioned in this article.