Are you on the hunt for promising AI stocks that won’t break the bank? The AI revolution is in full swing in 2023, and while many AI companies have witnessed remarkable growth, there are still affordable options out there. In this comprehensive guide, we’ll explore the exciting world of Artificial Intelligence stocks under $10 and shed light on why AI is currently dominating the stock market.Discover promising Artificial Intelligence stocks under $10 with significant growth potential. Explore budget-friendly investment options in the evolving world of artificial intelligence
The AI Craze of 2023
Every year brings a new investment trend that captures the market’s attention. In 2019, it was the tech sector, with companies like AMD and Lam Research reaping significant gains. In 2020, blockchain took center stage as numerous small-cap firms added “Bit” or “blockchain” to their names and enjoyed explosive growth. The meme stock phenomenon featuring GameStop dominated 2021, while 2022 was all about inflation concerns.
In 2023, the spotlight is firmly on artificial intelligence, with NVIDIA leading the charge as the consensus best AI stock. The proliferation of AI tools across various industries, from robotics to healthcare, has sparked massive interest. AI is simplifying tasks, making processes more efficient, and offering unique solutions, even in fields like wealth management, where robo-advisors are becoming increasingly popular.
However, with large-cap stocks like NVIDIA potentially taking a breather due to stretched valuations, the focus is shifting towards under-the-radar stocks that could provide substantial returns, especially for retail investors with smaller account balances. Let’s delve into the reasons why investing in AI stocks under $10 is a compelling idea.
Why Invest in AI Stocks?
- Explosive Growth: The global AI market is projected to surpass $1.8 trillion by 2030, with a staggering compound annual growth rate of nearly 33%, according to Next Move Strategy Consulting.
- Versatility: AI is proving to be a game-changer in various industries, including healthcare, data management, fintech, and cybersecurity. Each of these sectors invested over $5 billion in AI technology and products in 2022.
- Rapid Adoption: AI adoption is happening faster than anticipated. A 2023 Statista survey revealed that over a quarter of young professionals, including Gen X, Gen Z, and millennials, reported using generative AI tools like ChatGPT in their jobs.
Exploring the Top AI Stocks Under $10
Here’s a carefully curated list of the best AI stocks under $10 that are worth considering. Keep in mind that these stocks often belong to small or microcap companies, which can result in volatility. It’s crucial to align your investment goals with your risk tolerance before diving into these AI gems.
- Nio Inc. (NIO)
- Industry: Electric vehicles
- Market Cap: $19.6 billion
- Average Price Target: $13.31
Nio, a Chinese electric vehicle manufacturer, is gaining recognition both domestically and internationally. With a diverse range of products, including smart vehicles, Nio is a strong contender in the EV market. Despite a “hold” rating, analysts anticipate a 16% upside with an average price target of $13.31.
- FiscalNote Holdings Inc. (NOTE)
- Industry: Business services
- Market Cap: $383.7 million
- Average Price Target: $8.35
FiscalNote, a tech firm with a substantial network, provides AI-driven solutions for policy and regulatory management. With six “buy” ratings from analysts and recent institutional accumulation, NOTE is poised for growth.
- SoundHound AI Inc. (SOUN)
- Industry: Software
- Market Cap: $518.5 million
- Average Price Target: $4.35
SoundHound AI specializes in voice-enabled products and customizable AI voice assistants. With a “buy” rating from Canter Fitzgerald and substantial institutional investments, SOUN holds promise.
- Nerdy Inc. (NRDY)
- Industry: Education services
- Market Cap: $708.4 million
- Average Price Target: $5.67
Nerdy operates an online learning platform powered by proprietary AI, connecting learners and educators. Increased price targets and institutional inflows signal potential for NRDY.
- Rekor Systems Inc. (REKR)
- Industry: Software
- Market Cap: $209.6 million
- Average Price Target: $3.88
Rekor Systems focuses on AI solutions for transportation management and public safety. Despite its relatively short existence, REKR has garnered institutional attention and boasts a $200 million market cap.
- Lantronix Inc. (LTRX)
- Industry: Computer equipment
- Market Cap: $143.2 million
- Average Price Target: $9.33
Lantronix provides AI-powered computer equipment and IoT solutions. Analysts predict a 137% upside, with “buy” ratings for LTRX.
- AudioEye Inc. (AEYE)
- Industry: Software
- Market Cap: $55.7 million
- Average Price Target: $9
AudioEye offers accessibility solutions using AI technology, with all three analysts endorsing the stock and an upside potential of over 90%.
- Lantern Pharma Inc. (LTRN)
- Industry: Pharmaceuticals
- Market Cap: $50.1 million
- Average Price Target: $11
Lantern Pharma, a clinical-stage biotech firm, employs AI and machine learning to streamline drug development. With a “buy” rating and an impressive price target, LTRN presents an opportunity in the pharmaceutical sector.
Navigating the Risks of Small-Cap AI Stocks
While AI technology stocks hold great promise, particularly those under $10, it’s essential to acknowledge the inherent risks. Larger, well-established companies like NVIDIA and Microsoft continue to dominate the AI industry. Smaller startups may face challenges, such as competition or the risk of their innovations being surpassed.
Investing in low-priced stocks demands caution, as affordability doesn’t guarantee significant potential upside. Thorough research and a readiness to exit positions at the first sign of trouble are crucial practices when dealing with small-cap stocks in volatile markets.
Conclusion
Artificial intelligence is undoubtedly a trend to watch in the coming years. While identifying hidden gems among small-cap AI stocks can be challenging, the potential rewards are compelling. As AI technology continues to evolve, the landscape of affordable AI stocks may present exciting opportunities for investors willing to explore this dynamic market.
Methodology:
To qualify for our list of artificial intelligence stocks under $10, each company must leverage AI, machine learning, or automated technology to offer a product or service. Additionally, companies must meet at least three of the following criteria:
- Listed on a major exchange (NYSE, NASDAQ, BATS, TSX, etc.) – no penny stocks or pink sheets.
- Accelerating earnings estimates.
- Expanding analyst coverage.
- Average price target above the current price.
- Evidence of insiders accumulating shares.
- Increased buy ratings over the past 12 months.
Disclaimer:
The views and opinions expressed in this article are those of the author and do not necessarily reflect those of Nasdaq, Inc.
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