Morgan Stanley Reveals Top 20 AI-Driven Stocks as Adoption Hits Critical Mass

Katy Huberty, the Global Head of Research at Morgan Stanley, has spotlighted 20 stocks from companies that are likely to see significant benefits from the adoption of Artificial Intelligence (AI).

What Happened: Huberty expressed that we are currently at a “tipping point” for AI adoption. She underscored that businesses utilizing AI to boost their profits are on the verge of reaping considerable benefits.

Speaking with Business Insider earlier this month, Huberty pointed out that businesses with strong pricing power, those capable of maintaining or increasing their prices due to high demand, will witness the most significant impact on their profits.

“Pricing power will allow the companies to retain the productivity that they experience on the back of these investments and not have to pass that on to the customer,” she elaborated.

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Huberty referred to a list of stocks her team assembled in client note. The stocks, all AI adopters with high pricing power, have market caps over $20 billion. The list comprises The Home Depot, Inc. HD, Thermo Fisher Scientific Inc. TMO, and Intuitive Surgical, Inc. ISRG, Deere & Co. DE, Spotify Technology SPOT, MercadoLibre Inc MELI, Marriott International Inc MAR, Hilton Worldwide HLT, PACCAR Inc PCAR, Schlumberger NV SLB, Johnson Controls International PLC JCI, Axon Enterprise Inc AXON, Coupang Inc CPNG, Baker Hughes Co BKR, Experian PLC, Delta Air Lines Inc DAL, IDEXX Laboratories Inc IDXX, United Airlines Holdings Inc UA, Halliburton Co HAL, among others.

Why It Matters: The adoption of AI has been a hot topic in recent years, with many industries recognizing its potential to transform business operations and drive profitability.

Huberty’s identification of these 20 stocks underscores the growing importance of AI in the business landscape. Companies that successfully leverage AI technologies stand to gain a competitive edge, particularly those with strong pricing power.

This development could signal a shift in investment strategies, with investors potentially looking to companies with strong AI adoption as promising opportunities.