As we approach 2024, a strange phenomenon is creeping into the market. I’ll call it AI fatigue. There is a feeling that perhaps artificial intelligence is a bubble that has run its course.
Some analysts are looking to move away from the newness of generative AI and large language models and toward the good stuff, which they believe means how companies will make money from AI.
No one can predict the future, but the next wave of AI will include interactive and autonomous AI. While real returns may be years away, several companies are already making inroads into these areas. Here’s why investors may want to consider these three stocks for their 2025 portfolios.
UiPath Leads the Way in Workforce Automation
UiPat today
(As of 12/13/2024 ET)
- 52 week range
- $10.37
▼
$27.87
- Target price
- US$17.50
UiPath Inc. NEW YORK: THE WAY is a software company specializing in robotic process automation (RPA) technology. This technology gives users the tools to automate processes that regularly occur. The company’s UiPath platform advances the path to agent-based automation—a state in which agents, robots, humans, and models seamlessly integrate, enabling autonomous processes that lead to smarter decision making.
The company is not consistently profitable, but revenue is growing year after year. Growth is slowing, but that’s to be expected after the rapid growth in 2023. However, the company faces competition in this area from more established players such as Microsoft. To this end, UiPath continues to spend on marketing as well as research and development.
However, the company is well capitalized and has no debt. Analysts are raising their price targets on PATH stock, with a consensus price target of $17.71. This gives investors a 21% upside from the December 11 closing price.
Intuitive surgical equipment is expensive, but continues to provide benefits
Intuitive surgery today
Intuitive Surgical
(As of 12/13/2024 ET)
- 52 week range
- $320.26
▼
$556.23
- P/E ratio
- 86.75
- Target price
- $550.28
Intuitive Surgery Inc. NASDAQ: ISRG is a leader in the field of robotic surgical assistance. The company is the brains behind the Da Vinci robotic surgical system, now in its fifth generation. Intuitive Surgical uses artificial intelligence and machine learning (ML) technologies to generate information that can help surgeons learn from cases ranging from simple to more complex cases, including those with anomalies and complications.
ISRG stock is up 61% in 2024, easily outperforming the broader market. However, the stock is a good example of how stocks can be expensive and still offer good value. In this case, Intuitive Surgical has a forward P/E of over 100x. Considering the company is forecast to post roughly $6.57 in earnings per share for the full year, you can see why analysts are raising their price targets to $650 per share.
Expansion is the impetus for iRhythm
iRhythm Technologies today
iRhythm Technologies
(As of 12/13/2024 ET)
- 52 week range
- $55.92
▼
$124.11
- Target price
- US$107.82
Digital health company iRhythm Technologies Inc. NASDAQ:IRTC develops and manufactures medical devices that provide ambulatory cardiac monitoring services to help patients diagnose arrhythmias. The company says its latest product, Zio, features the most advanced artificial intelligence for heart monitoring based on more than a million hours of heart rate data.
The company’s current products are used by 6.4 million patients in the United States. However, iRhythm plans to expand its market to include a broader range of symptomatic patients. It is also planning international expansion, which should increase its the total addressable market exceeded one billion. Revenue is growing, but the company is not profitable and is not expected to grow next year.
Despite nearly 20% growth over the past three months, IRTC shares are still expected to fall 15% in 2024. That hasn’t stopped analysts from raising stock prices. The consensus price target of $107.82 is nearly 20% above the stock’s closing price on December 11. However, some analysts have a much higher price target, including Canaccord Genuity Group, which raised its price target from $125 to $152.
Before you consider iRhythm Technologies, you should hear this.
MarketBeat tracks Wall Street’s top-rated and best-performing analysts daily and the stocks they recommend to their clients. MarketBeat identified five stocks that top analysts are quietly whispering to their clients to buy now before the broader market takes hold… and iRhythm Technologies wasn’t on the list.
While iRhythm Technologies currently has a Moderate Buy analyst rating, the top-rated analysts think these five stocks are Strong Buys.
View five stocks here
Wondering where to start (or end) with AI stocks? These 10 common stocks can help investors build long-term wealth as artificial intelligence continues to advance in the future.
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