The AI rally of the past 18 months has largely focused on big-tech names and semiconductor manufacturers. But AI’s applications can encompass and benefit every company, no matter what industry it’s in.
That’s leading to a number of stealth AI plays. These are companies that will benefit from the rise of this technology and its rollout in the years ahead. Investors who buy into these companies can see market-beating returns in the years ahead.
One such company is
Dell Technologies (DELL). Best known for personal computer manufacturing, the company’s expansion into servers plays right into the AI boom.
Shares just received an analyst upgrade, and the stock hit a new 52-week high last week. That pushed the company’s market cap to $100 billion, which still makes it a fraction of the big-tech players benefitting from AI today.
Earnings have surged 89% over the past year. And shares are reasonably valued at 19 times earnings.
Action to take: Long-term investors may want to buy a small stake now, and use any market pullback to add to that position. Dell shares currently pay a 1.2% dividend.
For traders, shares are in an uptrend and are likely to continue in the months ahead. The July $160 calls, last trading for about $7.80, could see mid-double-digit returns from a further rally in Dell shares.
Disclosure: The author of this article has no position in the company mentioned here, but may trade after the next 72 hours. The author receives no compensation from any company mentioned in this article.