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Saturday, August 26, 2023

The Artificial Intelligence Semi-Pure Play Stocks


 I originally wrote about the pure-play artificial intelligence stocks earlier this year in an article called Top Five Pure Play AI stocks.

Unfortunately, those stocks have very low market capitalizations and are very speculative. I figured it may be worthwhile to cover a couple of the semi-pure plays in AI.


AI: What It Is

Artificial Intelligence, commonly referred to as AI, has become a revolutionary force in our modern world. It encompasses various technologies that enable machines to perform tasks that typically require human intelligence. From learning and reasoning to problem-solving and decision-making, AI has the potential to transform multiple aspects of our lives. In this blog post, we will delve into two intriguing applications of AI: Chat AI and image creation with DALL-E.


Chat AI: Transforming Customer Service and Beyond

One of the most widely used AI services today is Chat AI, which leverages natural language processing (NLP) and machine learning to enable machines to communicate with humans through chat interfaces. This technology has found a place in numerous settings, including customer service, healthcare, education, and business operations.

The key advantage of Chat AI lies in its ability to provide 24/7 support to customers without human intervention. Chatbots can efficiently handle frequently asked questions, offer information, troubleshoot issues, and even provide personalized support. By automating routine tasks, organizations can save costs and improve customer engagement.

Developers working on Chat AI face the challenge of creating algorithms that understand and interpret natural language while delivering appropriate responses. Achieving this requires a combination of NLP and machine learning techniques, as well as continuous training and improvement of the chat AI system.


Creating Images with AI: The DALL-E System

AI has ventured into the realm of visual arts with the creation of images using systems like DALL-E. Developed by OpenAI, DALL-E harnesses machine learning techniques, including NLP and computer vision, to generate images based on textual descriptions.

DALL-E’s name is a fusion of the renowned artist Salvador Dali and the beloved Pixar character Wall-E. The system has been trained on vast amounts of data, consisting of text-image pairs gathered from various sources, allowing it to understand the relationship between textual descriptions and their visual representations.

The potential applications of DALL-E are far-reaching. It offers avenues for artists, designers, and advertisers to streamline the creative process and bring ideas to life more quickly. By simply inputting a description, one can obtain an automatically generated image, even depicting non-existent objects or scenes.

However, as with any powerful technology, there are concerns associated with the misuse of AI image creation. Issues such as the production of fake images and the perpetuation of harmful stereotypes require careful consideration and ethical practices.


The Future of AI

Artificial Intelligence continues to shape our world, and its potential is boundless. Chat AI has already made significant strides, revolutionizing customer service and various industries by providing automated support and streamlining operations. As developers enhance algorithms and machine learning techniques, the capabilities of Chat AI will continue to expand.

In the realm of image creation, DALL-E showcases the remarkable progress AI has made. Allowing machines to generate images based on textual descriptions has implications for art, design, and advertising. While this technology opens new doors for creativity, it is crucial to approach it responsibly to mitigate potential risks.

As AI advances further, it is important for society to stay informed and engage in discussions surrounding its development and applications. By fostering a collaborative approach, we can ensure that AI technologies like Chat AI and image creation systems are used ethically and for the betterment of humanity.

Palantir Technologies (PLTR) is a software company that specializes in data analysis and artificial intelligence. Founded in 2003 by Peter Thiel, Alex Karp, and others, Palantir focuses on developing software platforms that enable organizations to integrate, analyze, and interpret large amounts of data.

Artificial Intelligence plays a significant role in Palantir’s offerings. The company’s flagship product is called Palantir Gotham, which is an AI-powered platform designed for data integration and analytics. Palantir Gotham utilizes advanced AI algorithms to extract insights from complex and diverse data sources, helping organizations make informed decisions and gain a deeper understanding of their data.

The AI capabilities of Palantir Gotham enable it to handle vast amounts of structured and unstructured data, including text, images, and sensor data. The platform incorporates machine learning and natural language processing techniques to uncover patterns, detect anomalies, and generate predictive models. By leveraging AI, Palantir Gotham provides users with powerful tools for data exploration, visualization, and collaboration.

Palantir also offers another product called Palantir Foundry, which is an AI-driven data integration and management platform. Foundry enables organizations to ingest, transform, and analyze data from various sources, making it accessible and actionable. Through AI technologies, Foundry automates data processing tasks, enhances data quality, and provides intelligent recommendations for data governance and security.

In addition to their software products, Palantir has developed AI applications for various industries and sectors. They have worked with government agencies, law enforcement, and intelligence communities, providing AI-powered solutions for data-driven decision-making, risk analysis, and security operations. Palantir’s AI capabilities have also found applications in healthcare, finance, and manufacturing, among other sectors, where they help organizations optimize processes, detect fraud, and improve operational efficiency.

However, it’s worth noting that Palantir’s use of AI has also raised concerns regarding data privacy, ethics, and potential biases in decision-making. As with any AI technology, responsible development, transparency, and accountability are essential considerations to mitigate these concerns.

Overall, Palantir utilizes AI as a core component of its software platforms and applications, enabling organizations to harness the power of data for improved decision-making and operational efficiency.

The stock trades at a fairly high forward price to earnings ratio of 65, however, the company has no long term debt. Quarterly revenue growth year-over -year increased by 17.7%, and the long term annual growth estimate of earnings per share over the next five years is 73%.

Verint Systems (VRNT) is a well-established software company that provides solutions for customer engagement, workforce optimization, and security intelligence. While Verint is not primarily known as an artificial intelligence company, they have integrated AI technologies into some of their offerings to enhance their capabilities.

Verint’s AI-powered solutions are designed to help organizations extract valuable insights from large volumes of data, automate processes, and improve decision-making. They utilize machine learning, natural language processing, and other AI techniques to analyze and interpret data from various sources.

In the customer engagement domain, Verint offers AI-driven solutions for voice and text analytics. These solutions can analyze customer interactions, such as calls, emails, chat conversations, and social media posts, to identify sentiment, extract key insights, and detect patterns. By leveraging AI, Verint enables organizations to understand customer behavior, optimize customer service operations, and personalize customer interactions.

Verint also provides AI-powered workforce optimization solutions, which help organizations manage and optimize their workforce performance. These solutions leverage AI algorithms to analyze employee data, identify training needs, and provide recommendations for improving workforce efficiency and productivity.

In the realm of security intelligence, Verint incorporates AI technologies to enhance their offerings. Their security solutions utilize AI-based video analytics to detect and alert on suspicious activities, automate the monitoring of security cameras, and enable real-time incident response.

While Verint Systems is not exclusively an AI-focused company, they have recognized the value of incorporating AI technologies into their solutions to enhance their capabilities and provide value to their customers. By leveraging AI, Verint aims to help organizations improve customer engagement, optimize workforce performance, and enhance security intelligence.

The stock trades at a very reasonable 11.7 times forward earnings, and the quarterly earnings growth year-over-year was 61.2%. The long term annual growth estimate of earnings per share over the next five years is 9.75%.


Disclosure: The author owns PLTR and VRNT. This article contains Amazon affiliate links whereby I would receive a small commission on any sale through those links at no additional cost to you.

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