We recently compiled a list of the 10 AI News Investors Shouldn’t Miss. In this article, we are going to take a look at where Tesla, Inc. (NASDAQ:TSLA) stands against the other AI stocks.
Famously known as the “godfather of artificial intelligence”, British-Canadian computer scientist Professor Geoffrey Hinton has recently warned that the pace of technological change today is much faster than was initially anticipated. As a result, there is a 10% to 20% chance that artificial intelligence will wipe out humanity within the next three decades. Previously, he had said there was only a 10% chance of technology doing so.
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Despite such warnings, companies are racing to lead the AI arms race. OpenAI, for instance, which is also known as the company that started the race itself, has recently outlined plans to revamp its structure. The company said that it would create a public benefit corporation so that it would make it easier to raise more capital.
Reuters reported the news back in September, which had sparked debate among corporate watchdogs and tech moguls regarding whether the company would be able to allocate its assets to the nonprofit arm fairly, and whether the company would be able to strike a balance between making a profit and breeding public good as it develops AI.
“We once again need to raise more capital than we’d imagined. Investors want to back us but, at this scale of capital, need conventional equity and less structural bespokeness. The hundreds of billions of dollars that major companies are now investing into AI development show what it will really take for OpenAI to continue pursuing the mission”.
-OpenAI
The company plans to turn its for-profit branch into a Delaware public benefit corporation (PBC), aligning its structure with rivals such as Anthropic and Musk’s xAI, which use a similar structure and have recently raised billions in funding.
“The key to the announcement is that the for-profit side of OpenAI ‘will run and control OpenAI’s operations and business. This is the critical step the company needs to make in order to continue fund raising,” Luria said, although he added that the move did “not necessitate OpenAI going public”.
-DA Davidson & Co analyst Gil Luria.
For this article, we selected AI stocks by going through news articles, stock analysis, and press releases. These stocks are also popular among hedge funds.
Why are we interested in the stocks that hedge funds pile into? The reason is simple: our research has shown that we can outperform the market by imitating the top stock picks of the best hedge funds. Our quarterly newsletter’s strategy selects 14 small-cap and large-cap stocks every quarter and has returned 275% since May 2014, beating its benchmark by 150 percentage points (see more details here).
Tesla, Inc. (NASDAQ:TSLA)
Number of Hedge Fund Holders: 99
Tesla, Inc. (NASDAQ:TSLA) is an automotive and clean energy company that leverages advanced artificial intelligence in its autonomous driving technology and robotics initiatives. On December 19, Reuters reported that Tesla is in conversation with authorities in Austin, Texas about its autonomous vehicle technology. The report revealed that a Tesla employee has been in touch with the city’s autonomous vehicle task force to establish vehicle safety expectations since May. Back in October, the company revealed a prototype of Cybercab, a driverless and pedal-less vehicle, at its Hollywood Robotaxi event. Elon Musk also announced at the event that they will be introducing the “unsupervised” version of its driverless technology in Texas and California next year. According to industry experts, Tesla would face fewer challenges in less-regulated states such as Texas. This is because there are almost no restrictions and the regulation of driverless vehicles by cities is explicitly prohibited.
Overall TSLA ranks 5th on our list of the AI stocks investors shouldn’t miss. While we acknowledge the potential of TSLA as an investment, our conviction lies in the belief that some AI stocks hold greater promise for delivering higher returns and doing so within a shorter time frame. If you are looking for an AI stock that is more promising than TSLA but that trades at less than 5 times its earnings, check out our report about the cheapest AI stock.
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Disclosure: None. This article is originally published at Insider Monkey.
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