5 Best Robotics and Artificial Intelligence Stocks To Buy

3. JD.com (NASDAQ:JD)

JD.com is a China based retailer that focuses on cutting edge artificial intelligence research. They focus on deep learning, natural language processing, and speech recognition. JD is the third most popular artificial intelligence stock in our list. A total of 87 hedge funds had bullish JD positions at the end of June.

We recently shared Hayden Capital’s detailed comments on JD in this article. Billionaire Dan Loeb is also very optimistic about JD. Here is what he said about JD back in August:

“During the quarter, we took advantage of jitters about China’s relationships with Hong Kong and the U.S. that created an air pocket in trading of Chinese‐related shares to establish new positions in e‐commerce leaders Alibaba and JD.com. As we have articulated in prior letters, our outlook for Alibaba and the broader Chinese e‐commerce market is bright. We believe online gross merchandise value (“GMV”) will grow at a mid‐teens CAGR over the next five years, propelled by both (1) rising consumption per capita, as the Chinese retail market is equal in size to the U.S. despite four times as many consumers, and (2)increased penetration of retail by online, a trend which we believe has been structurally accelerated by the COVID‐ 19 pandemic.

As the e‐commerce market matures, we believe Alibaba & JD will leverage scale and growing repositories of transaction data to increase monetization of their platforms through targeted advertising to improve revenue yields (revenues as a percentage of GMV) from a starting point of less than 4% today. As a point of comparison, brick‐and‐mortar retail store rent expenses in China are greater than 10% of sales on average, which provides a significant umbrella for online marketplaces to take a greater share of GMV through a combination of commission and advertising spending as online retailer cost structures converge with brick‐ and‐mortar retail.