Only a modicum of intelligence is needed to see that artificial intelligence (AI) will profoundly change our world given recent advancements in technology and innovation. By smartly investing in HI-quality companies embracing artificial intelligence, including Alphabet Inc. (GOOGL), long-term investors should reap bright rewards, explains Ingrid Hendershot, editor at Hendershot Investments.

During the pandemic, half of US companies increased their investment in AI, according to Accenture. AI holds enormous promise for companies to create value in all directions— from market leadership to a more skilled workforce to innovation that contributes to meeting the world’s top challenges.

Chart  Description automatically generated Regarding AI’s impact on society, Paul Daugherty, chief technology and innovation officer of Accenture (ACN), remarked, “This is by far the fastest-moving technology that we’ve ever tracked in terms of its impact and we’re just getting started.”

Even though artificial intelligence was founded as an academic discipline more than 65 years ago, it has recently received remarkable buzz with the rollout of intelligent chatbots from Microsoft (MSFT) and Google. These chatbots use generative AI to rapidly produce answers in a “human voice” in response to questions or requests by synthesizing vast amounts of information on the Internet.

Microsoft has invested billions in OpenAI’s ChatGPT and is integrating it into its Bing search engine. More than 100 million users flocked to ChatGPT within its first two months of launch. Google has unveiled Bard, its chatbot competitor, which seeks to combine the breadth of the world’s knowledge with the power, intelligence and creativity of its large language models.

With the new generation of AI rolling out across American workplaces, McKinsey & Co. estimates that 25% of work activities in the US across all occupations could be automated by 2030. This dovetails with a forecast made in 1930 by economist John Maynard Keynes, who had predicted that in 100 years technology would eliminate the monotonous nature of work, freeing up humans to toil less and enjoy life more.

Alphabet is an online advertising and technology sector leader that generated a strong 23% Return on Equity and impressive $60 billion in free cash flow in 2022. It is also an AI leader.

Recommended Action: Buy GOOGL

Subscribe to Hendershot Investments here…