Artificial Intelligence: The Unseen Opportunities in the FTSE 100
As investors, we’re often drawn to the obvious candidates when it comes to artificial intelligence (AI) stocks. However, I believe there are opportunities hiding in plain sight, particularly in the FTSE 100. In this article, I’ll explore how two UK companies, Barclays and the London Stock Exchange Group, could benefit from the rise of AI.
The Data Goldmine
AI needs a significant amount of computing power, and as a result, the market for data centres has been booming. Nvidia has been a big beneficiary of this trend, but with its share price up 700% since the start of 2023, investors are starting to look elsewhere. Specifically, they’re turning to other AI inputs, such as power and data.
Data centres are crucial for AI development
Information is key to AI, and companies that provide this data could be about to do well. This is where I think there are opportunities for UK companies to benefit from the rise of AI.
Barclays: A Hidden Gem
Barclays is a good example of a company that could benefit from the rise of AI. The bank has a roughly 40% share of the UK credit card market, giving it unparalleled data into people’s spending habits. This data could be incredibly valuable when paired with a trained large language model (LLM).
Barclays’ credit card data could be a goldmine for AI
The London Stock Exchange Group: A Data Powerhouse
Another interesting candidate is the London Stock Exchange Group. The company owns Refinitiv, which accounts for around 70% of its revenues. This part of the company is a data and analytics operation that provides information to investors.
The London Stock Exchange Group’s data could be highly valuable in an AI world
Investing in AI
Artificial intelligence is the investing theme of 2024, and it’s likely to remain popular for some time. That makes it hard to find opportunities to buy AI stocks at decent prices. However, by looking beyond the obvious candidates, I believe there are opportunities to be found in the FTSE 100.
AI is the investing theme of 2024
In conclusion, AI is about more than just computing. Looking slightly further afield, there are some UK companies with data that could prove to be highly valuable assets over the next few years. By investing in these companies, we could be well-positioned to benefit from the rise of AI.
“AI is the investing theme of 2024, and it’s likely to remain popular for some time.”
