Two Billionaire-Backed Artificial Intelligence (AI) Shares that You Can Immediately Purchase for $500

Two Billionaire-Backed Artificial Intelligence (AI) Shares that You Can Immediately Purchase for $500

Billionaire investors Bill Ackman from Pershing Square Capital Management and Andreas Halvorsen of Viking Global Investors are two individuals worth watching for investment advice. They manage billions in assets, showcasing their ability to make wise investment decisions.

Alphabet (GOOG 1.72%) (GOOGL 1.54%) and Salesforce (CRM 2.21%) are two stocks these firms hold in the second quarter. Both companies have promising growth prospects due to their investment in artificial intelligence (AI). With $500 left after expenses or debt payment, you can comfortably invest in a share of each. Here's why these are suitable investments in AI at the moment.

1. Alphabet

Pershing Square has maintained a stake in Alphabet's parent company since the first quarter of 2023. Alphabet's shares were undervalued when acquired but remain an appealing choice given the company's strong growth prospects in the AI era.

Alphabet boasts a diverse portfolio, with Google Cloud and its Waymo self-driving car division among its assets. While online advertising drives most of its revenue, it continues to grow steadily.

Revenue amplified by 15% year on year in the third quarter to $88 billion, primarily due to the growth of Google Search, subscriptions, devices, and YouTube ads. New search features, such as AI Overviews, are increasing user engagement and potentially boosting Alphabet's ad revenue in the long term.

Alphabet's investments in AI, like its Gemini AI models, are enhancing the usefulness of its products and bolstering its growth prospects. This is most evident in Google Cloud, where revenue surged 35% year-on-year. Google Cloud offers tools empowering companies to build generative AI applications – a promising segment of the AI market expected to expand substantially in the coming years.

Although Pershing Square sold shares in the second quarter, I believe it remains an underpriced large-cap tech stock. Shares trade at a forward P/E ratio (P/E) of 22, which appears considerably attractive when compared to estimates predicting Alphabet's earnings will increase by a compound annual rate of 16%.

2. Salesforce

Viking Global's investment portfolio includes numerous stocks, and it purchased Dow Jones member Salesforce in the second quarter. Salesforce shares have appreciated by 18% year to date at the time of writing.

Salesforce software facilitates faster workflow for a company's employees, enabling tasks like sales lead chasing, marketing, customer service, and more. The company consistently posted double-digit annual revenue growth until economic challenges in 2022 slowed the entire enterprise software market's growth.

While growth hasn't been as substantial lately, Salesforce's incorporation of AI across its software could lead to improved growth.

Businesses covet improved employee productivity, which seems to be an ideal opportunity for Salesforce, the market leader in CRM software. Salesforce has heavily invested in AI, as demonstrated by Agentforce – an AI-driven assistant that automates tasks and retrieves information.

Although the stock has recently surged, its valuation remains enticing. Shares trade at a forward P/E ratio of 31, which seems reasonable given growth expectations. Analysts forecast Salesforce's earnings will increase by an annualized rate of 16% over the long term, potentially doubling the share price in five years if the stock maintains its current valuation.

The CRM market holds immense potential, with predictions of a $145 billion value by 2029, according to Statista. Salesforce boasts considerable growth potential with only $36 billion in trailing revenue. Shares are an excellent buy-and-hold investment.

Based on the text, here are two sentences that contain the words 'money', 'investing', and 'finance':

1. With $500 left after expenses or debt payment, you can comfortably invest in a share of each Alphabet and Salesforce, given their growth prospects in the AI era and the underpriced nature of their stocks.
2. Investors, like Bill Ackman and Andreas Halvorsen, manage billions in assets and provide valuable investment advice, demonstrating the significance of finance and investing in shaping investment portfolios.

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