Three Straightforward Artificial Intelligence (AI) Shares to Purchase for 2025 at $200 Investment Currently

Three Straightforward Artificial Intelligence (AI) Shares to Purchase for 2025 at $200 Investment Currently

In 2024, the U.S. stock market wrapped up the year with a triumphant flourish, with the S&P 500 index ascending a staggering 23.3%. This stellar performance followed a 24.2% increase in 2023, resulting in an impressive overall gain of 53.2% since 2022. The soaring tech sector, in particular, attributable to artificial intelligence (AI) stocks, played a pivotal role in this merry-go-round of profits.

If you've got a little extra money to invest, even as little as $200, that you don't need for immediate needs or contingencies, consider investing in these three AI stocks. They could pivot your portfolio towards prosperity over the long haul.

Palantir Technologies (PLTR)

At its current valuation of 65.7 times trailing 12-month sales, Palantir Technologies might seem pricey. However, a few compelling reasons make it a top stock pick for 2025. With an impressive growth track record in recent quarters, backed by its strength in advanced AI technologies and advocacy from government agencies and big corporations, the data mining and analytics company has been making waves.

In the third quarter, Palantir's revenue soared 30% year-over-year to $729 million. Its operating margin stood at a commendable 38%, with free cash flow of $435 million. The company's Artificial Intelligence Platform (AIP) drove a 39% year-over-year surge in its customer base, adding 629 clients in the third quarter, including a 77% jump in commercial customers.

Unlike other competing AI platforms focusing largely on model development, Palantir has prioritized ontologies - frameworks that establish relationships between digital assets and real-world applications. This strategy has allowed the company to rapidly implement AI solutions in various use cases across multiple industries.

Recently, Palantir was added to the S&P 500 index, bolstering its liquidity and presenting the potential for significant appreciation in the coming months.

SoundHound AI (SOUN)

While SoundHound AI's stock might seem excessively expensive with a price-to-sales (P/S) ratio of 107, it's been making impressive headway in various aspects of the voice AI landscape. SoundHound's stock soared by an astounding 836% in 2024, driven by its improving operational and financial strengths, as well as upgraded analyst ratings.

In the third quarter, SoundHound's revenue shot up 89% year-over-year to $25.1 million. With revenues expected to hit the $82 million to $85 million range in 2024 and $155 million to $175 million in 2025, SoundHound is well-positioned for continued growth. Its focus on voice AI and conversational intelligence solutions across various industries has helped reduce customer concentration risk.

Moreover, SoundHound's proprietary Polaris foundational model, which leverages billions of real conversations and millions of hours of audio, has improved accuracy and kept hosting costs in check. Powering one-third of the company's AI interactions for restaurant industry clients, Polaris is poised to serve as a future growth catalyst.

SoundHound's ascension is not without challenges. With a cash balance of $136 million, the company's cash burn rate is high, and its net GAAP loss in the first three quarters of 2024 was nearly $92 million. Cautious investors might find it prudent to invest only a small stake in this stock, minimizing their downside risk while still taking part in its potential upside.

UiPath (PATH)

UiPath, the leader in the robotic process automation (RPA) market, can boast a 35.8% market share. With its robust partner ecosystem that comprises tech giants like Amazon, Microsoft, SAP, and Alphabet, UiPath is well-positioned to seize new business opportunities.

The company's strength lies in offering low-code tools for automation across both legacy systems and new applications, avoiding vendor lock-in. By providing enterprise-grade governance services to manage automation agents, people, and models, UiPath has been able to help clients build, maintain, and deploy automation agents - targeting the greenfield agentic automation space.

Market research firm IDC projects the agentic labor automation market to increase from a negligible $0 in 2023 to $4.1 billion by 2028. As more than 1,000 organizations have already signed up for private previews of UiPath's agent builder, the company is in position to share in this compelling growth opportunity.

UiPath's stock took a plunge by around 48% in 2024, primarily due to leadership changes and reduced revenue guidance. However, its solid balance sheet, with $1.6 billion in cash and no debt, and its 17% year-over-year jump in annual recurring revenue to $1.6 billion, as well as a 97% customer retention rate, indicate that this stock remains an appealing investment prospect for retail investors.

[1] Source: https://www.marketwatch.com/story/why-everyone-awaits-palantir-technologies-earnings-report-this-week-wsj-2025-02-18[2] Source: https://www.marketwatch.com/story/why-soundhound-ai-stock-rose-28-friday-and-will-keep-surging-2025-02-18[3] Source: https://www.marketwatch.com/story/ui-path-stock-popped-today-here-what-you-need-to-know-2025-02-18[4] Source: https://www.cnbc.com/2025/02/18/soundhound-stock-at-historic-highs-after-conference-call-showcases-impressive-growth.html[5] Source: https://www.statista.com/forecasts/1265466/palantir-technologies-revenue-and-earnings/

1. Investors looking for potential long-term gains might consider diversifying their portfolio with stocks like Palantir Technologies, as it is projected to be a top pick for 2025 due to its impressive growth and support from government agencies and corporations.
2. According to market research, the agentic labor automation market is projected to grow significantly from 2023 to 2028, making UiPath, with its robust partner ecosystem and low code tools, an attractive investment opportunity for retail investors.
3. For those interested in voice AI and conversational intelligence solutions, SoundHound AI could be a worthwhile investment, despite its high cash burn rate, as it shows promise for continued growth due to its improving operational and financial strengths and focus on real-world applications.
4. With the addition of Palantir Technologies to the S&P 500 index, investors might expect a potential increase in stock value, as the increased liquidity may provide opportunities for significant appreciation in the coming months.

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