Take A Look: Only These 17 AI Stocks Are Undervalued

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An Introduction

PEG ratios go up and down as stock prices change and the major decline (-13.2%) last week in the 17 "best value" AI stocks has resulted in changes to their PEG ratios so, if you’re looking for AI companies primed for revenue and earnings growth, strong profitability, and upward analyst revisions, consider investing in one or more of the stocks highlighted in this article.


What Is the PEG Ratio?

The PEG ratio (price/earnings-to-growth ratio):

  • provides a simple way for an investor to calculate how cheap a stock is relative to its growth rate and to compare a stock to its competitors,
  • builds upon a stock's current price-to-earnings (P/E) ratio by factoring in its earnings growth prospects in the ensuing year,  
  • determines if a stock is trading at, above, or below, fair value and if the stock is priced above, or below, the industry median.
    • A PEG ratio below 1.0 suggests that the stock price is undervalued relative to its expected future earnings growth. In other words, the market may not fully account for the company’s growth potential.
    • Conversely, PEG ratios above 1.0 indicate that the stock price might be overvalued, as it isn’t necessarily supported by growth forecasts,

A PEG ratio should be used along with an analysis of the company's balance sheet, debt burden, and cash flow, and other valuation metrics that use the income statement it's important to understand things like a company's competitive advantage, its addressable market, and its long-term growth prospects.


The 17 "Best Value" PEG Ratio AI Stocks 

Below are the PEG ratios of the top 17 "best value" AI stocks, in descending order:

  1. Baidu (BIDU): PEG Ratio: 0.40
  2. Block (SQ): PEG Ratio: 0.49
  3. ASE Technology (ASX): PEG Ratio: 0.51
  4. Unity Software (U): PEG Ratio: 0.56
  5. Super Micro Devices (SMCI):PEG Ratio: 0.65
  6. Zoom Video (ZM): PEG Ratio: 0.66
  7. Twilio (TWLO): PEG Ratio: 0.71
  8. Uber Technologies (UBER): PEG Ratio: 0.75
  9. Axcelis Technologies (ACLS): PEG Ratio: 0.83
  10. Box (BOX): PEG Ratio: 0.84
  11. Nvidia Corporation (NVDA): PEG Ratio: 0.87
  12. Qorvo (QRVO): PEG Ratio: 0.89
  13. Taiwan Semiconductor (TSM): PEG Ratio: 0.90
  14. Advanced Micro Technology (AMD): PEG Ratio: 0.95
  15. Intel Corporation (INTC): PEG Ratio: 1.01 
  16. STMicroelectronics (STM): PEG Ratio: 1.01
  17. Meta Platforms (META): PEG Ratio: 1.08 
    • 17-stock Average PEG Ratio: 0.77

Please keep in mind that the above PEG ratios are the current stock prices of the day relative to the 12-month earnings estimates of the company and that they will vary throughout the trading day as the company's stock price fluctuates - the PEG ratio will increase as the stock price rises and decrease as the stock price falls.


Conclusion

The above analysis provides the answer to the opening statement about looking for AI companies primed for revenue and earnings growth, strong profitability, and upward analyst revisions. You now have a short list from which to do your own due diligence before proceeding further. 


More By This Author:

Small Cap AI Stocks Portfolio Already Down 19% So Far In April
All 7 AI Category Portfolios Continued To Decline This Week
Bitcoin Halving Is Happening Saturday; What Could It Mean For Its Future Price?

Disclosure: None

This article has been composed with the exclusive application of the human intelligence (HI) of the author. No artificial intelligence (AI) technology has been deployed. ...

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