Here's 1 of the Best AI Stocks Investors Should Consider Buying in October With $1,000
Key Points
Alphabet trades at a forward price-to-earnings ratio of less than 23, despite being one of the highest-quality companies on Earth.
With its positions in research, chip development, cloud services, and user-facing apps, the business has exposure to all parts of the AI stack.
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At this point, it's almost impossible to ignore just how important artificial intelligence (AI) has become to the economy. Consequently, businesses that have centered their strategies around developing AI products and services have been big winners. These companies are positioning themselves for long-term success.
If you're looking to allocate capital to the space, Alphabet (NASDAQ: GOOGL) (NASDAQ: GOOG) is one of the best AI stocks to consider buying in October with $1,000.
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With a $4.2 trillion market capitalization, it certainly isn't flying under the radar. But even though its shares have soared by 156% in the past five years (as of Oct. 6), they trade at a compelling valuation. Investors can add the stock to their portfolios now at a forward price-to-earnings ratio of just 22.8.
For one of the world's dominant internet enterprises, that valuation almost looks like a no-brainer opportunity.
Alphabet has long been a leader in AI, and its early investments are paying off. The company is involved in many different areas of the AI value chain, from research at Google DeepMind and chip development (Tensor Processing Units) to its thriving Google Cloud segment and its numerous widely adopted user-facing platforms.
The business has a massive user base that gives it unmatched distribution. Network effects provide it with a durable moat. And it has different ways to monetize its AI capital expenditures, which number in the hundreds of billions of dollars.
Allocating $1,000 to the stock now would be a smart decision.
Should you buy stock in Alphabet right now?
Before you buy stock in Alphabet, consider this:
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Neil Patel has no position in any of the stocks mentioned. The Motley Fool has positions in and recommends Alphabet. The Motley Fool has a disclosure policy.
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