Motley Fool’s Top AI Stock Picks – Best AI Investments

Artificial intelligence is everywhere today. It’s being used by Fortune 500 companies and start-up entrepreneurs; by CFOs and online shop owners; and by workers in almost every industry at every level. 

What does that mean for you as an investor? For starters, it means that you need to understand the increasing demand and growth potential of AI stocks is huge.

If you’re familiar with Motley Fool, you might be wondering about Motley Fool AI stock picks and what AI stock is Motley Fool recommending.

We’ve got the answers. If you’re looking to diversify your portfolio and take advantage of the rising wave of AI companies and their growth potential, we’re here to share some Motley Fool AI stock recommendations to help you ride the wave and even stay ahead of developments in the evolving AI industry.

Motley Fool’s AI Stock Recommendations: An Overview

You might be wondering how Motley Fool AI stock picks are made and what philosophy is behind those picks.

Let’s start with the basics. Motley Fool Stock Advisor provides investors with two vetted stock picks every month. They recommend that subscribers buy equal amounts of every stock pick for the best results. (Keep in mind that Motley Fool is not a brokerage and is not regulated by the SEC.)

The stock strategy the Motley Fool is built on is buy-and-hold, meaning that you buy a stock and hold it for at least five years. This approach helps investors ride out market volatility and maximize their profits.

Stock Advisor picks, which are what we’ll be focusing on here, are chosen by Team Everlasting, and they focus on these traits.

• High-quality companies with sustained growth potential and the potential to beat the overall market.
• Founder-led companies.
• Businesses that have a strong corporate culture.
• Cash-rich, low-debt companies.
• Companies with a strong customer bond and related pricing power and proprietary advantages.

In other words, they look for companies that are already strong and well-established, and offer investors a strong opportunity to earn significant profits.

Making these picks requires thorough research and analysis, and that’s something that applies to AI stock picks, too.

Motley Fool AI stock picks have performed extremely well. For example, Nvidia was recommended in May of 2024 and has risen more than 57% in less than six months.

What AI stock is Motley Fool recommending? Keep reading to get five Motley Fool AI stock recommendations.

Pro Tip:

If you sign up with The Motley Fool today, you will receive $100 off and a 3 day money back guarantee!

Top 5 AI Stocks Recommended by Motley Fool

Here is a list of the top 5 Motley Fool AI stocks.

Microsoft

It may come as no surprise that Microsoft was a Motley Fool AI stock recommendation on December 21, 2023, but let’s talk about why.

Microsoft acquired Nuance in March of 2022. Nuance has been a leader in the areas of ambient intelligence and conversational AI in multiple industries, including financial services, healthcare, retail, and telecommunications. The acquisition gave Microsoft a powerful ally in building outcome-based AI, with a focus on vertically-optimized, AI-powered cloud solutions.

Some of the financial metrics that led to the recommendation include a net income margin of 35.6%, which indicates strong profitability, and operating cash flow of $34.18 billion.

Since the recommendation, Microsoft has risen to $424.34, an increase of 13.28% in less than a year.

ServiceNow, Inc.

ServiceNow, Inc. was a Stock Advisor pick on January 4, 2024, when it was trading at $671.87 per share.

The company is responsible for creating the Now Platform for workflow automation and AI integration.

Financial considerations that went into the recommendation include the company’s high profits of 79% TTM and strong cash position with approximately $1.885 billion in cash and equivalents.

Since it was recommended, ServiceNow, Inc. stock has risen to $1,009.30, an increase of 50.22%.

Pro Tip:

If you sign up with The Motley Fool today, you will receive $100 off and a 3 day money back guarantee!

NICE Ltd

NICE Ltd was a Stock Advisor pick on March 21, 2024. This is a company that has been innovating in AI for far longer than some of the other companies on this list.

The Stock Advisor recommendation was based on NICE’s well-established position in the world of AI, including its innovations in the areas of customer engagement and financial crime and compliance.

The company has strong cash flow and a TTM profit of 67.06%. Since it was recommended, the price has dropped by about 30%, a change that’s likely due to the departure of its CEO. It’s important to remember Motley Fool’s buy-and-hold strategy. They are still listing NICE, Ltd as a buy as of November 7, 2024.

Atlassian

Atlassian was a Stock Advisor pick on September 7, 2023, when its stock was trading at $206.92. The company is a leader in digital transformation.

The Stock Advisor pick came because Atlassian has developed a new suite of AI tools that promise to accelerate the company’s growth. They noted that despite a downturn in overall IT spending, Atlassian had the strength to ride out any volatility.

As of November 7, 2024, Atlassian is trading at 231.83, an increase of 12.04%.

Nvidia

Nvidia has been all over the news and with good reason: the company is a monster in the world of AI. It was a Motley Fool pick on May 16, 2024, when the stock was trading at $94.36.

Nvidia got its start developing graphics processing units (GPUs) for use in gaming computers, but their parallel computing power has made them useful in AI applications as well.

The company’s focus on creating integrated software solutions has allowed them to simplify and secure the process of granting access to third-party software suppliers.

As of November 7, 2024, Nvidia stock is trading at $148.26. That’s an increase of 57.12% in less than six months.

We hope that you’ll be inspired by these top 5 AI stocks Motley Fool has recommended.

How to Use Motley Fool’s AI Stock Picks in Your Investment Strategy

How can these AI stock picks fit into a balanced investment strategy? Here are a few tips.

• Keep an eye on your portfolio and make sure no stock takes up more than 10% (at most) of your overall holdings. You can link your brokerage account to Motley Fool to make it easy to sign up for alerts.
• Explore different aspects of AI. For example, it’s good to have some tech companies in the mix, but you should also look at companies that use AI in innovative ways or are investing in AI, even if they’re not directly developing it.
• Spread your AI-related investments across multiple sectors and industries.

It’s just as important to keep an eye out for when Motley Fool changes a recommendation. If the experts behind the picks feel that there’s too much of a risk for investors, they’ll change their BUY recommendation to a HOLD or SELL recommendation. When there’s a sell recommendation, you’ll want to act quickly to avoid the price dropping further as other Motley Fool subscribers heed their advice.

Getting regular AI stock picks and updated investment advice are two reasons that we believe subscribing to Motley Fool’s services is a good value for the money.

Pro Tip:

If you sign up with The Motley Fool today, you will receive $100 off and a 3 day money back guarantee!

Conclusion

Investing in AI stocks with Motley Fool’s guidance is something we recommend. AI is the wave of the future and a forward-looking approach is essential if you want to focus on long-term investments.

Here are some of the benefits of investing in AI stocks.

• Ride the wave of a growing industry
• Diversify your portfolio with AI-related stocks across multiple industries
• Get recommendations based on both past performance and future potential

By following Motley Fool recommendations, you’ll be positioned to make informed and strategic investments in a rapidly growing sector, maximizing your earning potential.