"Meta Platforms and Pure Storage are poised to benefit as artificial intelligence spending continues to surge in the years ahead. Morgan Stanley analysts estimate artificial intelligence (AI) spending across infrastructure and software will increase more than 600% by 2028. Buying stock in Nvidia and/or Palantir has been a popular way to capitalize on that trend, but investors should consider Meta Platforms and Pure Storage."
"Meta Platforms owns three of the four most popular social media networks as measured by monthly active users. That dominant competitive position affords the company insight into consumer tastes and preferences, which helps it target media content and advertising. In turn, Meta Platforms is the second largest ad tech company worldwide, and it's poised to gain market share, according to Morningstar. The company has been investing aggressively in artificial intelligence (AI), including custom chips, Llama large language models, machine learning models to recommend content, and AI creative tools for advertisers."
"Even more ambitious, Meta hopes to automate the entire ad creation process by next year. The Wall Street Journal recently reported, "Using the ad tools Meta is developing, a brand could present an image of the product it wants to promote along with a budgetary goal, and AI would create the entire ad, including imagery, video, and text.""
AI spending across infrastructure and software is projected to increase more than 600% by 2028. Investors commonly target Nvidia and Palantir, but Meta Platforms and Pure Storage present alternative exposures to AI growth. Wall Street median targets imply about 19% upside for Meta and roughly 4% upside for Pure Storage from recent share prices. Meta owns three of the four largest social networks by monthly active users, giving strong ad-targeting advantages. Meta has invested in custom chips, Llama language models, recommendation machine learning, and AI creative tools, boosting user engagement and ad conversion, and plans to automate end-to-end ad creation.
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