From Nvidia (NVDA) to enterprise software publishers like Salesforce.com (RCMP), Working day (WDAY) And JFrog (FROG), a range of artificial intelligence games make IBD Breakout Stock Index. SAP (SAP) is also making this stock screen as it approaches a breakout with profits expected on January 24.
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As AI Trends continue driving NVDA Stock and others to new heights, SAP emphasizes what it calls Trustworthy AI.
In line with this desire, the global software giant based in Germany has also just announced new AI-powered capabilities to help retailers. Through its SAP Business AI technology, the company seeks to help its customers make increasingly informed, AI-driven decisions. The objective is to enable retailers to optimize their processes to increase their profitability and retain their customers.
See who joins SAP, CRM and NVDA on the IBD Breakout Stocks Index
SAP says the full impact of generative AI is yet to be realized
Although the enormous potential of generative AI is well known, SAP says its impact is yet to be fully realized.
If applied as a tool to transform businesses, supply chains and entire industries, SAP believes that generative AI can accelerate the evolution of the global economy, making it more sustainable, resilient, equitable and prosperous.
But ensuring the reliability of generative AI remains essential to delivering on this promise. According to SAP, this all comes down to AI being firmly established as relevant, trustworthy and responsible.
SAP emphasizes that the quality of AI depends on the data it is trained on. The software leader says the generic data used for today’s best-known large language models (LLMs) won’t help companies solve particularly granular problems. Delivering context-specific propositions requires working with real business data.
Reliability also matters. The stakes arising from a single business decision can be very high. Therefore, commercial AI results must demand the highest accuracy and quality.
SAP also highlights how responsible generative AI for business needs to be. AI models trained and working with public data on the Internet may violate privacy and copyright regulations. SAP says this type of “gray zone” mode of operation is unthinkable in the business world.
Ethical AI implementation also comes into play. SAP says ensuring ethical operations requires clear guiding principles, internal governance structures and an advisory board of external experts.
SAP Stock generates a new purchase point
Fellow AI leaders Nvidia and Selling power both were on the list of best stocks of 2023. NVDA stock continues to build on last year’s gains and is now trading around another all-time high. Business software peers Salesforce, along with Workday and JFrog, are also showing strength after an early setback to kick off 2024. FROG stock has been under pressure but continues to find support at its 21-day exponential moving average.
Meanwhile, SAP stock has established a first leg flat base with gains forecast for next week. THE point of purchase is 160.35.
While it’s risky to buy a stock right before its release, SAP continues to rely on a strong rebound in earnings and sales.
In each of the last three quarters, the company has seen earnings growth. For the third quarter, SAP reported 40% year-over-year earnings growth, to $1.53 per share. Revenue growth accelerated during the same period. Third-quarter sales jumped to $8.186 billion, a 12% gain from the year-ago quarter.
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Follow Matthew Galgani on X (formerly Twitter) at @IBD_MGalgani.
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