Yesterday I discussed a theme that I think will be huge over the next 10 years and beyond. The investment theme is artificial intelligence (AI),or deep learning. I think everyone should have some exposure in their portfolio.
Today, I am going to follow up with three investment ideas for those of you interested in getting exposure to this huge secular (market-speak for “long-term”) trend. Without further ado, here we go:
- Tencent Holdings (TCEHY): $56.40. I know many of you may not have ever heard of this company before. Tencent is a Chinese company, and it is an absolute beast! It is the largest video game company on the planet, and it operates in the largest country in the world. In America we have Facebook, Yelp and Uber; in China, Tencent is all of those apps wrapped into one. They are dominant, and I’m confident that they will implement AI to become even more dominant. AI is based on information. He who has the most information has a competitive advantage…and no one has more information on its users then Tencent.
- Alphabet (GOOGLE): $1,126. Now, this is pretty pricey, at over a thousand dollars for one share. But it may not look that pricey in 10 years. I could not leave this off my list, because Google is one of the leaders in AI. Right now, their self-driving platform is in the lead – if they are first to market, that could propel them to enormous growth. The projections for the autonomous vehicle market are in the multiple trillions – yes, trillions! Now I’m not saying that this will necessarily happen, but…Berkshire Hathaway looked very pricey back in 1983, at $1000 a share – and today it trades at $315,000 a share! Imagine you’d invested in it back then?
- iRobot (IRBT): $85.55. Over the last two years, the best selling vacuum cleaner in America has been the Roomba. iRobot manufactures the Roomba along with many other household robots that clean your floors. People want convenience, and they want freedom…and that’s what the Roomba gives them! It may not be the best product on the market, but it performs the job well enough to have become the top selling vacuum cleaner in the country! We are without a doubt moving towards a Jetsons existence (link provided for those of you who aren’t old enough to know who the Jetsons are!). I believe iRobot will continue to be a leader in the consumer robotics category for many years to come. AI, or deep learning, will only improve their products’ performance, giving them a distinct competitive advantage.
In my opinion, these three companies are set to thrive over the next 10 years, and artificial intelligence will be a big reason why. I would strongly consider making one, if not all, a part of your portfolio.
Until next time, Joes!