Investing experts have always touted the benefits of diversity in a portfolio, and what’s more diverse than betting on the future with AI stocks? Artificial intelligence, or AI, has metamorphosed industries, wielding its transformative power to reshape how businesses function and innovate. From Tenet Healthcare Corporation (THC), integrating AI in healthcare delivery, to Pinterest, Inc. (PINS), elevating user experience with visual AI, and Jones Lang LaSalle Incorporated (JLL), optimizing real estate management through AI insights, these companies epitomize the formidable force of this technology.
Goldman Sachs analyst David J. Kostin, akin to a sage navigating the market seas, foresees tremendous growth for these AI adopters, envisioning a future where enhanced labor productivity and monumental triple-digit bottom-line growth reign supreme.
Discovering Tenet Healthcare’s AI Advancements
Stepping onto the AI stage with a market cap of $13.3 billion, Tenet Healthcare Corporation (THC) emerges as a stalwart in U.S. healthcare services. Founded in 1967 and boasting two robust segments – Hospital Operations and Ambulatory Care – Tenet offers a vast array of services, spanning acute and critical care to specialized procedures such as cardiovascular and neurosurgery.
Tenet Healthcare wields AI to revolutionize patient care efficiency and operational effectiveness. By utilizing AI to project patient outcomes, streamline administrative tasks, and modernize HR and payroll processes, Tenet Health Central Coast hospitals are accelerating stroke diagnosis and treatment with Viz.ai, which not only trims costs but also enhances service quality – metamorphosing Tenet into a surprising healthcare AI contender.
The market has lauded Tenet Healthcare’s strides, propelling its shares to climb an impressive 74.3% over the past year, with a staggering 83% surge in 2024 alone – leaving the S&P 500 Index’s returns in the dust.
Poised for Success: Pinterest’s AI Revolution
Originating in 2008 as Cold Brew Labs Inc., before its 2012 revamp, Pinterest, Inc. (PINS) has evolved into a visual search and discovery platform based in San Francisco, now valued at $30.3 billion by market cap, a testament to its meteoric rise. Users worldwide flock to Pinterest for an array of inspirations, from culinary concoctions to interior design musings.
Embracing AI to overhaul user experience, Pinterest has journeyed from personalized content recommendations to cutting-edge visual search prowess. With CEO Bill Ready championing “inclusive AI,” ensuring diverse representation in search results, Pinterest has positioned itself as a Gen Z shopping haven by seamlessly blending discovery with purchases.
Pinterest’s shares have soared by 67.1% in the last 52 weeks, with a YTD surge of 19.1%, overshadowing the SPX’s performance during the same periods.
Analyzing the AI Impact: Pinterest and Jones Lang LaSalle
Pinterest Surges Past Expectations
Like a sturdy vessel navigating through turbulent waters, Pinterest’s Q1 earnings results on April 30 were a testament to resilience and growth. The company reported a remarkable 23% revenue increase year over year, outperforming Wall Street’s estimates by 5.7%. With an EPS surge of 150% annually to $0.20, Pinterest demonstrated its prowess in the digital realm. Notably, the platform recorded a substantial uptick in global monthly active users, reaching 518 million, a 12% increase compared to the previous year.
In a move akin to two powerful engines propelling a ship forward, Pinterest joined forces with tech giants Amazon.com and Alphabet in Q1. These partnerships yielded tangible results, allowing Pinterest to capture a larger share of advertising budgets. Major clients now allocate approximately 5% of their ad spend to Pinterest, signaling the platform’s growing effectiveness in the advertising landscape.
For the upcoming fiscal Q2, Pinterest anticipates continued growth with revenue projected between $835 million and $850 million, reflecting an 18% to 20% annual increase. This forecast, although slightly lower than Q1, showcases Pinterest’s robust momentum. The company also plans to ramp up investments in research and development, particularly in bolstering its artificial intelligence capabilities through new talent acquisition across the organization.
Jones Lang LaSalle: Pioneering in AI Real Estate Solutions
Steering through the dynamic realm of real estate, Jones Lang LaSalle (JLL) stands out as a beacon of innovation. With a market cap of around $9.5 billion, JLL operates globally as a commercial real estate and investment management firm, providing comprehensive services to institutional and retail investors worldwide.
JLL has embraced the transformative power of artificial intelligence, leveraging generative AI to enhance its operations and empower its workforce. By delving into troves of industry data, JLL has developed cutting-edge AI solutions tailored for commercial real estate leaders. These tools streamline operations, boost productivity, and facilitate informed decision-making, thereby driving operational efficiencies in the industry.
Despite navigating a complex market landscape, JLL’s Q1 earnings results exceeded expectations, signaling robust growth across its core segments. The company showcased double-digit gains in its Work Dynamics segment and witnessed broad expansions in Property Management and Capital Markets. JLL’s ability to thrive in challenging conditions underscores its market resilience and strategic prowess.
With a focus on advancing its margins and driving growth initiatives, JLL aims to achieve an adjusted EBITDA margin between $950 million and $1.15 billion in fiscal 2024. By harnessing the potential of AI, JLL anticipates a significant boost in baseline earnings, paving the way for enhanced operational efficiency and profitability strategies in the future.
Market Outlook and Expert Projections
Goldman Sachs foresees a promising future for both Pinterest and JLL, with AI advancements expected to drive substantial increases in baseline earnings. For Pinterest, analysts project a profit of $0.44 per share in fiscal 2024, a remarkable 175% year-over-year growth, followed by a 59.1% rise to $0.70 per share in fiscal 2025.
Similarly, analysts tracking JLL anticipate the company’s profit to reach $12.36 per share in fiscal 2024, reflecting a 67% year-over-year increase, and further rise to $15.94 per share in fiscal 2025. The consensus ratings for both Pinterest and JLL lean towards a positive outlook, with analysts foreseeing strong growth potential for these AI-driven enterprises.
