We just published a list of 10 Best AI Stocks to Buy According to Reddit. In this section, we will look at how Snap Inc. (NYSE: SNAP) how it ranks among the best places to buy AI according to Reddit.
On December 4th, Jay Jacobs, US Head of Thematics and Active Equity ETFs at BlackRock appeared on CNBC and discussed the important growth of ETFs as we approach 2025, particularly in relation to the AI development sector. He said that while the adoption of AI is still in its early stages, huge investments, amounting to 250 billion dollars a year from major technology companies, are being made to develop data centers and develop advanced chips. This investment is important in making AI more integrated into daily life and business applications.
Jacobs stressed that the opportunity in AI goes beyond mega-cap tech stocks; includes a large value chain that includes semiconductor and software companies. He mentioned ETFs such as ARTY (index-based artificial intelligence fund) and BAI (effectively managed fund) that aim to capture this growth. In addition, he emphasized the increasing importance of cybersecurity as data becomes more important, indicating that companies will invest more in protecting their data. This trend is reflected in ETFs such as IHAK, which focuses on cybersecurity firms that are benefiting from this increased demand.
Dave Nadig, an ETF expert and Financial Futurist, added a perspective on how AI will shape ETF investing by pointing to the demand for infrastructure resulting from increased energy use driven by AI technology and electric vehicles. He said that companies involved in the production of electricity and utilities are increasing their activity as they are adapting to the rising demand for electricity. The two experts agreed on the important role of physical infrastructure in supporting technological progress, stressing that global resources such as energy and materials are essential to the continued development of AI technology.
Dan Ives, Global Head of Technology Research at Wedbush Securities, also believes that the tech market is set for significant growth driven by advances in AI. He expects AI software companies to play an important role in this expansion, as he said in an interview with CNBC on November 25. We discussed this in our article about 12 Best Artificial Intelligence Tools to Invest in Under $10here is an excerpt from it:
“… Ives believes that the use of brands in the AI business, driven by advances from major chipmakers, will lead to an unexpected growth of 15% to 20% for these software companies.
We started sifting through Reddit threads to create a list of the top AI stocks. We then selected 10 stocks that were the most popular among elite hedge funds and that analysts were bullish on. The stocks are listed in ascending order of the number of hedge funds that have stakes in them, as of Q3 2024. The hedge fund data was taken from Insider Monkey’s database which tracks the movements of more than 900 elite money managers.
Why do we like the stocks that hedge funds invest in? The reason is simple: our research has shown that we can outperform the market by following the best pictures of the best quality hedge funds. Our quarterly newsletter strategy selects 14 small-cap and large-cap stocks each quarter and has returned 275% since May 2014, beating its benchmark by 150 percentage points (syes more information here)
Why Snap Inc. (SNAP) is the Best AI Stock to Buy According to Reddit?
A young adult family uses a camera to record moments of their daily life.
Number of Hedge Fund Holders: 34
Snap Inc. (NYSE:SNAP) is a technology company known for popular products such as Snapchat, Spectacles, and Bitmoji. Snapchat, in particular, uses AI to enhance user experience.
The company is also investing in GenAI to empower developers to create more complex AR experiences. For example, the introduction of AI-powered tools in Lens Studio enables developers to easily create full 3D characters and images. In addition, its AI-powered chatbot, My AI, provides personalized responses and assistance to users, leading to increased user engagement, which is evident by three-quarters of the Snaps sent to My AI in Q3.
The company had strong Q3 2024 financial results, with revenue improving by 15.28% year-over-year to $1.37 billion. This growth was mainly driven by a 16% increase in direct response advertising revenue, which also uses AI for ad targeting and optimization. Snap Inc. (NYSE:SNAP) is expanding the user experience, and opening up new opportunities for marketing and monetization through AI.
RiverPark Large Growth Fund said the following about Snap Inc. (NYSE:SNAP) in its first quarter 2024. investor letter:
“Snap Inc. (NYSE: SNAP): SNAP was our top performer in the quarter even though it reported fourth quarter results generally in line with or better than expectations. Revenue growth of 5% was in line with investors’ estimates and at the end of guidance, and EBITDA of $159 million was $49 million above estimates. Daily Active Users (DAUs) were also ahead of expectations, finishing the quarter at 414 million (about 2 million better), driven by continued innovation in Snap’s offerings. Earnings guidance for 1Q24 was also in line with analysts’ estimates, but EBITDA guidance of a negative $55-95 million was below estimates. The company attributed the increase in property prices and the US marketing campaign to lower-than-expected margin guidance.
Overall, SNAP third place on our list of the best AI stocks to buy according to Reddit. As we know the growth potential of SNAP, our confidence lies in the belief that AI stocks hold great promise of delivering high returns and doing so within a short period of time. If you are looking for an AI stock that is more promising than SNAP but that trades less than 5 times its earnings, check out our report about cheap AI stock.
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Disclosure: None. This article was published on Insider Monkey.
