Different investors have different attitudes toward artificial intelligence (AI). Some consider it the next “tech bubble” like crypto, while others consider it just as game-changing and revolutionary as the computers and the internet were for the world.
Even if you reserve judgment until you have seen more of this technology, there is one thing you should understand: today, AI is as bad/weak as it’s ever going to be.
Like most technologies, AI is most likely to improve over time. Unlike many technologies, its growth is also tied to data, and we generate more and more of it each day. So, AI-based technologies will only improve from now on, and even if we don’t see a major breakthrough anytime soon, we will see more widespread adoption of AI tools at individual and institutional levels.
It might be prudent to invest in or at least keep an eye on the right AI-oriented tech stocks in Canada.
A supply chain tech stock
Kinaxis (TSX:KXS) is one of a handful of Canadian tech companies that focus on the supply chain. It offers end-to-end supply chain orchestration, allowing corporate entities to monitor and control every “link” of their supply chain. This increased visibility, and control allows them to make smart decisions on the go and identify cost-lowering and efficiency opportunities.
However, the Kinaxis overlap with AI makes it an intriguing pick from the tech sector. The company is empowering its existing tools and platform with AI algorithms, allowing for more efficient data processing, which leads to multiple positive consequences. This includes more automation opportunities, better data-handling abilities (for Business Intelligence), and a more resilient platform.
As a stock, Kinaxis was a powerful grower up until the post-pandemic correction of the tech sector. Kinaxis fell about 41% from its 2021 peak, and even though it’s currently among the most overvalued stocks in the market, it has turned the corner around. Its current recovery/growth is being powered by the bullish tech sector.
An information management tech stock
AI has a strong overlap with data/information. Hence, a company like Open Text (TSX:OTEX), which has a platform that allows businesses to manage their entire flow of information, is a naturally primed contender for an AI revolution.
Open Text has already started integrating its tools and various features of its platforms with AI algorithms and technologies. Their primary focus is currently analytics and automation, but their AI focus is expected to spill onto other services as well.
With a market capitalization of $14.3 billion, not only is Open Text among the few large-cap stocks of the tech sector, but it’s also among a few dividend payers from the sector and an established Aristocrat. It’s also a consistent grower, although the pace is quite modest from the typical tech sector standards.
Foolish takeaway
The two tech stocks might lead the Canadian tech sector in the AI revolution. Even though there are a number of smaller AI companies in the country, many of which are solely focused on AI, these two companies have the resources and presence to make its mainstream adoption a strength.
