Carey Smith, CEO of Parsons Corporation (PSN), highlights AI integration into drone defense, cybersecurity and supply chain solutions

We recently compiled a list of the AI News investors probably missed it. In this article, we'll take a look at where Parsons Corporation (NYSE:PSN) stands compared to the other AI stocks.

Investors have been looking for smart ways to capitalize on the artificial intelligence (AI) boom that has swept global financial markets over the past two years. Most of the attention in this regard has been limited to obvious choices in semiconductors, software and biotechnology. Even within these sectors, well-known companies and their AI initiatives dominate the headlines. However, there are several hidden gems in these sectors that offer the same value for money in the current macroeconomic context, but as such are not in the spotlight. For example, UBS analyst Bernie Ahkong recently noted that the first phase of AI involved interest in chipmakers. In the second phase, investors turned to the industrial companies that actually supply the components for the data centers. The current move toward utilities and energy companies may be the third phase of this AI focus.

For more information on these developments, see The top 33 AI companies to watch out for And 20 industrial stocks are already riding the AI ​​wave.

A recent study on artificial intelligence from Stanford University in the US shows that companies are already outperforming academics when it comes to training AI models. For example, in 2023, the AI ​​industry was able to train nearly 51 notable machine learning models, compared to just 15 in academia. This happened despite rising costs for training models. For example, ChatGPT 4, the latest version of the popular ChatGPT that started the AI ​​wave in late 2022, cost almost $80 million to train. Likewise, Gemini Ultra, an AI tool developed by Google, cost $191 million to calculate. The number of AI patents is also increasing, as evidenced by the fact that the number of AI patents granted has increased more than 31 times since 2010.

For more information on these developments, see 30 The most important AI stocks according to BlackRock And Beyond the Tech Giants: 35 Non-Tech AI Opportunities.

Our methodology

For this article, we selected AI stocks by reviewing news articles, stock analysis and press releases. These stocks are also popular with hedge funds.

Why do we care about the stocks hedge funds invest in? The reason is simple: Our research shows that we can outperform the market by mimicking the top stock picks of the best hedge funds. Our quarterly newsletter strategy selects 14 small-cap and large-cap stocks each quarter and has returned 275% since May 2014, outperforming its benchmark by 150 percentage points (see more details here).

The story continues

A satellite that navigates the sky and represents the capabilities of the Geospatial Solutions company.

Parsons Corporation (NYSE:PSN)

Number of hedge fund owners: 36

Parsons Corporation (NYSE:PSN) provides integrated solutions and services to the defense, intelligence and critical infrastructure markets in North America, the Middle East and internationally. Carey Smith, the company's CEO, told analysts during the first quarter earnings call that Parsons is using artificial intelligence across its portfolio and gave some example areas that the company works with in the federal technology and critical infrastructure segments , should be taken into account. Per Smith, one of those applications was the systems needed to defend against unmanned aircraft. Smith described the use of AI for this as the way operators identify, detect and track a drone that is in a place it probably shouldn't be. Cybersecurity and supply chain trustworthiness were the other two areas that Parsons Corporation (NYSE:PSN) focused on in developing AI solutions.

Total PSN takes 13th place on our list of AI stocks that investors probably missed. While we recognize PSN's potential as an investment, we believe some AI stocks have greater prospects of delivering higher returns, and within a shorter time frame. If you're looking for an AI stock that's more promising than PSN but trades at less than five times earnings, check out our report on it cheapest AI stock.

READ MORE: $30 Trillion Opportunity: The 15 Best Humanoid Robot Stocks to Buy, According to Morgan Stanley And Jim Cramer says NVIDIA has “become a wasteland”.

Disclosure: None. This article was originally published on Insider Monkey.