Interest in artificial intelligence (AI) skyrocketed last year after the launch of OpenAI's ChatGPT. The generative chatbot astounded the tech world with its ability to produce human-like dialogue based on prompts. OpenAI's platform highlighted just how far AI has advanced and its potential to boost countless industries.
As a result, dozens of tech companies ventured into AI and enjoyed major stock gains for their efforts. Companies like Nvidia and Amazon have seen their stocks climb 228% and 45% over the last 12 months, thanks to dominating positions in their respective areas of AI.
However, the market is vast and appears to have plenty of room left to run, projected to expand at a compound annual growth rate of 37% until at least 2030. Consequently, it could be worth investing in a company that is still in the early stages of its AI journey and could deliver significant growth in the coming years as the industry develops.
Here are two AI stocks that could make you a millionaire if you're willing to wait.
1. Intel
Shares in Intel (INTC 4.13%) have risen more than 115,000% since its initial public offering in 1971. The company was once the biggest name in chips and has undoubtedly created many millionaires in its time. However, the last decade has challenged the tech giant, with its stock down 3% alongside tumbles in revenue.
Yet, recent developments suggest a recovery is underway, with Intel an increasingly attractive way to invest in AI. The chipmaker's fall from grace and changes in the tech market forced Intel to rethink its business model. The company is reshaping its business around the semiconductor foundry market, an industry projected to more than double its 2022 valuation and hit $232 billion by 2032.
Intel kicked off its foundry expansion by beginning construction on chip factories around the world, with its primary focus being the U.S. The company plans to build at least four American manufacturing facilities. On June 11, Intel temporarily delayed construction on a plant in Israel as it works to proceed with its multibillion-dollar investment at a slower pace and keep finances in check. The move comes after Intel announced it would sell a 49% stake in its Irish plant for $11 billion.
NASDAQ: INTC
Key Data Points
Chip manufacturing plants won't come cheap but could pay off over the long term, especially regarding Intel's position in AI. While rivals like Nvidia and Advanced Micro Devices are prioritizing chip design and outsourcing much of their manufacturing, Intel could have a lucrative opportunity to become one of the biggest AI chip fabricators in the world.
Moreover, Intel's shares are trading at 28 times its forward earnings, significantly lower than Nvidia's 48 and AMD's 46. The figures indicate Intel's stock is potentially the biggest bargain in AI chips. In addition to a promising shift in its business model, Intel is a stock that could make you a millionaire over the long term.
2. Apple
Apple (AAPL +1.00%) was slower than many of its rivals in joining the AI race. As AI-driven companies like Microsoft and Amazon have seen their stock pop 33% and 45% since last June, Apple's has risen a more moderate 16%. However, the company's more gradual venture into AI isn't out of the norm for the consumer tech giant.
Apple hasn't necessarily found success being first to a technology. The company instead tends to stand by the sidelines as it observes the competition, perfecting its own version and then launching a product that catapults it to the top of the industry. The tech giant has used this strategy to dominate smartphones, tablets, headphones, and smartwatches.
Other companies led these industries before Apple landed on the scene, yet have mostly fallen by the wayside. Now, Apple appears to be employing a similar strategy to AI. The iPhone maker hosted its Worldwide Developer Conference on June 10, debuting its new AI platform, Apple Intelligence. The company's stock spiked 12% since the announcement, allowing it to surpass Microsoft and retake its position as the world's most valuable company by market cap.
NASDAQ: AAPL
Key Data Points
Apple Intelligence will launch in September and bring AI upgrades across the company's product lineup, including iPhone 15 Pro Models and Macs and iPads equipped with M1 through M4 chips. New features like language and image generation, a smarter Siri, and editing tools will elevate Apple's offerings with AI. Meanwhile, the new features could motivate many consumers to upgrade to the company's newer devices to gain access to the AI tools.
Apple's stock isn't a huge bargain, with its forward price-to-earnings (P/E) ratio at 33. However, compared to Microsoft's forward P/E of 37 and Amazon's 40, Apple is a far better value if you're looking to invest in AI. The company is only just getting started in the industry and could be worth investing in before it's too late.
