Many top artificial intelligence (AI) stocks have produced monster gains in recent years. These gains have been great for their longer-term shareholders, of course, but they've also left the stocks trading at expensive and forward-looking valuations -- levels high enough that some risk-averse investors may be avoiding the theme altogether.
But not all AI stocks are valued purely on where they will be several years from now.
Deere (DE 9.84%) and GE Healthcare Technologies (GEHC 10.60%) are both highly profitable, while Samsara (IOT 15.63%) went public in December 2021. All three companies offer unique ways to invest in AI, and all three are worth buying now.
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Deere offers a balance of growth, value, and income
Daniel Foelber (Deere): While you are probably familiar with Deere's agriculture and construction equipment, you may not be aware that Deere is also a play in industrial AI.
Deere is responding to a skilled labor shortage in the agriculture and construction industries by developing autonomous vehicle tech for its equipment. It first unveiled its autonomous tractor in 2022. Earlier this year, Deere released its second-generation autonomous kit featuring computer vision, AI, and cameras. New solutions include an autonomous tractor for large-scale agriculture, an autonomous orchard tractor, an autonomous articulated dump truck for quarry operations, and an autonomous battery-electric mower for commercial landscaping. All of the machines are managed by the company's cloud-based platform, John Deere Operations Center Mobile.
In addition to its AI opportunities, Deere could also be a solid stock to buy for investors who are concerned about how tariffs will impact U.S. companies. On its February earnings call, Deere noted that more than 75% of its domestic revenues come from equipment manufactured in the U.S., and less than 5% of U.S. completed goods sales come from Mexico. The majority of its products that are manufactured outside the U.S. are made in Europe. And Mexico only makes up 10% of U.S. manufacturing cost of goods sold, while China accounts for less than 2% and Canada is just 1%.
So, despite its international presence, Deere is still predominantly a U.S. company from a manufacturing and sales perspective. That could help insulate it from the impact of trade conflicts, in contrast to companies with more global supply chains.
Deere's stock price reached an all-time in February. However, its earnings, sales, and margins have dipped due to broader slowdowns across many of Deere's end markets. Deere is a cyclical company in a cyclical industry, so investors should be wary of putting too much weight on traditional valuation metrics like the price-to-earnings (P/E) ratio because the stock will look cheap when earnings are booming and expensive when earnings are coming down. However, P/E ratio can be a useful gauge when Deere is in mid-cycle form and when looking at historical averages.
Deere's earnings have come down significantly in recent years, but they're still far above pre-pandemic levels. However, the stock price has also gone up significantly.
Still, Deere's P/E sits at a reasonable 20.9. And the stock has a growing dividend too with a yield of 1.4% at the current share price.
Add it all up, and Deere is a good, safe stock with extra upside potential from its ability to monetize its AI over the long term.
AI is the future of better healthcare
Lee Samaha (GE Healthcare): While most investors are focused on the AI companies that are behind the technology and infrastructure used to support and grow it, a host of companies are increasing the value of their products by integrating AI into them. One such company is GE Healthcare.
As management said in the last earnings call, "Our commercial strategy supports our evolution from an imaging company to a healthcare solutions provider." A key part of that transition involves using AI-enabled devices to improve its overall offering.
GE Healthcare is a leader in imaging equipment and, at the same time, makes pharmaceutical diagnostics (imaging agents used to diagnose and even guide the treatment of diseases). In fact, it's the only company that does both. It also makes patient care systems (monitoring, anesthesia delivery, maternal infant care, etc). Last year, it went from 58 AI-enabled FDA authorizations to 85, and these AI-enriched solutions can help doctors diagnose patients more quickly and accurately.
AI also helps clinical physicians better gather data and make more informed decisions by analyzing vast amounts of data from different sources, including imaging, monitoring equipment, and healthcare records.
It's also a key driver of GE Healthcare's precision healthcare strategy, whereby AI can better analyze patient data to develop personalized medical solutions. For example, in oncology, the company's imaging and pharmaceutical diagnostics can guide the precise distribution of a drug.
GE Healthcare is applying AI across all of its solutions, and the company's investment in the technology is adding value to its already strong position in the healthcare market. The stock trades today at 18 times Wall Street estimates for earnings in 2025, which looks like a good value for a company with robust long-term growth prospects.
Keep your eye on IoT leader Samsara
Scott Levine (Samsara): While its initial public offering three years ago wasn't heralded with extreme fanfare, and its name isn't much bandied about when AI talk emerges, AI investors searching for under-the-radar opportunities will certainly want to take a closer look at Samsara.
In addition to its broad Internet of Things (IoT) tools, Samsara is leveraging the power of AI to help companies make their operations safer and more efficient. From AI-enabled dashboard cameras that improve driver safety to using AI for proactive maintenance of assets to interactive training resources that improve employee performance, Samsara provides a variety of solutions that extend beyond its IoT offerings. And the company's hardly done innovating with AI tools.
Hinting at future products, CEO Sanjit Biswas commented on the company's fiscal fourth quarter 2025 conference call: "In the future, our customers will use AI to dynamically monitor operations to enhance safety and efficiency, adjust delivery routes based on weather and traffic and anticipate customer requests. By automating these tasks, AI will help fill labor shortages and skills gaps in operations."
It's important to recognize that Samsara stock carries a certain degree of risk as an investment. The company is still unprofitable on a GAAP basis, with an operating loss of $190 million and a net loss per share of $0.28 in its fiscal 2025 (which ended Feb. 1). However, there are signs that the company is on the right track. For one, it ended fiscal 2025 with $1.46 billion in annual recurring revenue, a year-over-year increase of 32%. Plus, Samsara has been generating positive free cash flow: $112 million and $27 million in fiscal 2025 and 2024, respectively.
