The AI market continues to grow rapidly, attracting investors looking to capitalize on the latest technological advancements. However, not all AI stocks are created equal, and some may present more risks than rewards.
According to Joel Lim, a financial analyst at Trading.biz, there are two AI stocks that investors should consider selling in 2024. These stocks, Twilio and C3.ai, have struggled to establish consistent profitability, making them less attractive investment options.
Twilio, a cloud communications company based in San Francisco, has faced challenges in generating steady revenue streams. Despite efforts to optimize its business segments, Twilio reported a significant GAAP loss of $361.7 million and only a 5% revenue growth in Q4. Joel Lim highlights that Twilio’s slow growth may not lead to promising short-term returns for investors.
On the other hand, C3.ai, specializing in enterprise AI, has seen a considerable jump in its stock price but lacks a solid financial foundation. With a 5% revenue increase in 2023 and a GAAP net loss per share of $-0.58, C3.ai has yet to reach profitability. While the company aims to turn a profit by the end of fiscal 2024, it still faces challenges in achieving sustainable growth.
Investors are advised to consider selling Twilio and C3.ai stocks sooner rather than later to minimize risks and explore more profitable opportunities in the AI market. With a focus on companies with stronger financial footing and growth prospects, investors can make informed decisions to maximize their returns in the evolving AI landscape.
