In recent years, artificial intelligence has been a strong force in the business and tech sector. It offers many benefits to large organizations and individuals alike, from enhancing workforce productivity to providing solutions to common problems. Gartner released a report that found at least one-third of businesses are looking to spend at least $1 million on AI in the next couple of years. Moreover, the industry will grow at a compound annual growth rate (CAGR) of 33.6% over the next several years and will reach an estimated market size of $360.36 billion by 2028. Naturally, this will lead to huge upside for AI stocks.

The sector includes some of the most powerful tech companies globally with meteoric valuations. Hence, it’s tough to find AI stocks trading under the $10 mark. After careful scrutiny, I’ve picked out seven of the most promising AI stocks that are trading at remarkably cheap valuations:

  • Rekor Systems (NASDAQ:REKR)
  • Duos Technologies Group (NASDAQ:DUOT)
  • Alithya (NASDAQ:ALYA)
  • Lantronix (NASDAQ:LTRX)
  • Ideanomics (NASDAQ:IDEX)
  • Vivint Smart Home (NYSE:VVNT)
  • AudioEye (NASDAQ:AEYE)

AI Stocks to Buy: Rekor Systems (REKR)

 

Rekor Systems is a provider of advanced vehicle recognition mechanisms. The company leverages video with AI to deliver robust automated services for its clients. Moreover, its AI and machine learning competencies allow for the effective identification of vehicles and license plates. The results have been excellent with a high-quality service at lower costs.

The company is looking to evolve from a direct-sales approach to a subscription model. The new model is likely to result in higher margins and recurring revenues. Revenues during its latest quarter were up 23% from the prior-year period but significantly down from the previous quarter.

According to the management, the long-term benefits of its business transition will more than offset its short-term losses. Moreover, REKR stock could perhaps be an excellent long-term bet based on its incredible outlook.

Duos Technologies Group (DUOT)

 

Duos Technologies is an enterprise that develops automated inspection spaces for rail cars. It has efficiently automated rail car inspection through its proprietary technology and plans to branch out into other verticals.

Moreover, it intends to move towards a more recurring revenue model and international expansion. Its automated inspection services have provided substantial cost savings for its clients so far.

The company results have been highly encouraging of late. Its revenues during its third-quarter have grown by 36% to $1.74 million. Moreover, it forecasted its net loss for the upcoming quarter to fall in the $250,000 to $295,000 range compared with a reported $426,000 in the same quarter last year.

Additionally, it expects its net revenues to double this year from last year. Therefore, it has an incredible growth runway ahead which points to a healthy upside with DUOT stock.

AI Stocks to Buy: Alithya (ALYA)

 

Alithya Group provides a wide array of digital technology services in the U.S., Canada and Europe. Its services include enterprise architecture services, digital transformation, consulting and other services. Moreover, it provides an integrated AI service called Askida, enabling clients to test the functionality of various applications effectively.

The company financials have been excellent of late. In its most recent quarter, its sales shot up 55.4% to $109.7 million, comfortably surpassing analyst estimates. Moreover, with its recent acquisition of Vitalyst, a transformative change enabler, Alithya is looking to expand its business through acquisitions and merger activity.

Expanding margins and efficient expense management will be two primary goals for the company as it seems to take ALYA stock to new heights.

Lantronix (LTRX)

 

Lantronix provides internet of things (IoT) solutions across a range of applications for its customers. Though it operates in a highly competitive sector, its growth rates have been stellar in recent years, with a rapid increase in incomes. Hence, its solid top-line growth can consistently rake in positive income.

It saw tremendous expansion in its top and bottom lines during the pandemic. On a year-over-year basis, its sales have grown by a remarkable 103%.

Looking ahead, the company expects a colossal 57% to 78% bump in year-over-year revenues in fiscal 2022. Margins are also likely to improve over time with the expansion of its software as a service (SaaS) platform. Hence, LTRX stock could perhaps be one of the best AI stocks currently in the market.

AI Stocks to Buy: Ideanomics (IDEX)

 

Ideanomics is an up-and-coming fintech and EV (electric vehicle) specialist. It operates two segments that use AI to improve outcomes for its userbase. Firstly, its mobility segment offers electrification solutions for commercial fleet operators. This includes forecasting, inventory benchmarking, charging infrastructure and other elements. The other division provides fintech solutions by leveraging technology and innovation.

The business has been growing rapidly, boasting triple-digit revenue growth in the past year. In its most recent quarter, sales improved by 155% to $27 million from the prior-year quarter. Gross margins are also improving, and with well over $250 million in cash, the company has a deep pool of capital to continue advancing its expansion plans.

Its debt load is concerning, so IDEX stock is a relatively risky play. However, it has massive upside potential with its innovative offerings.

Vivint Smart Home (VVNT)

 

Vivint provides a vertically integrated smart home solution to its growing client base. Its services include sales, software, support, hardware and other related aspects. The smart home trend has been growing swiftly, and it stands to benefit hugely.

Its revenues are growing rapidly, but its path to profitability remains a concern. A lot of it is down to its poor distribution strategy, which raises questions on its scalability. Nevertheless, it offers an amazing value proposition that can gain plenty of traction in the coming years. However, VVNT doesn’t come without its risks.

AI Stocks to Buy: AudioEye (AEYE)

 

AEye is an Arizona-based digital accessibility platform. It specializes in making digital content more accessible to people. It offers a holistic solution with an easy setup, legal compliance and other unique features. An estimated 20% of people in the U.S. alone have a disability which equates to 67 million people. Worldwide that number is at around 1 billion.

The company is targeting a colossal $350 billion market, a fraction of which can result in sizeable revenues. It currently has an impressive customer base of 80,000 individuals, which grows with every passing quarter. Hence, AEYE stock has a lot of potential for exponential growth ahead.

Image Credit: Tara Winstead Pexels; Thank you!

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