1 under the radar FTSE 100 AI stock investors should consider buying
One FTSE 100 business that’s already successfully employing artificial intelligence (AI) tech successfully is RELX (LSE: REL). The business may not be an obvious name in the AI race, compared to the likes of Nvidia, for example.
Here’s why investors should be taking a closer look at RELX.
Data and decisions
RELX helps a vast array of organisations turn data into actionable insights, and help them make decisions. Imagine a load of data, records, and publications, all cleaned and then quantified. This data is then given to relevant professionals to help them do their jobs effectively. Machine learning is a big part of its offering, and this is where the AI element comes in too.
It’s worth noting that RELX shares are up 32% over a 12-month period. At this time last year, they were trading for 2,254p, compared to current levels of 3,391p.
The investment case
Let’s start with the bear case. One big aspect that stood out to me was RELX’s current valuation. The shares trade on a price-to-earnings ratio of close to 36. This is significantly higher than the FTSE 100 average. A couple of things could happen. Firstly, RELX could see its performance dip. The other is if AI sentiment among investors were to fall dramatically. Both issues combined or separately could severely dent the shares.
The other risk is the changing face of academic research, one of RELX’s biggest money spinners. If the current pay-to-read article model continues to pivot towards pay to publish, RELX’s subscription model could take a big hit. This could hurt its performance and investor sentiment.
To the bullish view, I’m buoyed by RELX’s wide coverage geographically, and from an industry perspective. It helps the legal sector with cases, doctors with diagnosing patients, and governments make key decisions, as a few examples. In addition to this, as the world continues to use digital tools more, there’s room for RELX to continue to grow.
Plus, the business has an excellent track record of performance, growth, and returns. The shares currently offer a dividend yield of just under 2%. Furthermore, it’s buying back shares, which is positive.
Finally, the business is now using its substantial profits from impressive margins to drive AI-related growth. This could prove to be a fruitful strategy moving forward, in my view.
Final thoughts
Whenever I see a high valuation, I often think that sometimes paying a premium for a quality business is absolutely fine. However, there is a risk that the hype around AI dies down or RELX can’t deliver the growth it’s targeting.
To conclude, even away from the AI aspect, RELX is a quality business with an excellent reach, great track record, solid balance sheet, and offering a passive income.
Personally, I’d love to buy some shares when I next can, and I’d buy them quicker if they dropped in value slightly. If the AI surge continues, and RELX can capitalise, there could be some good times ahead.
5 Shares for the Future of Energy
Investors who don’t own energy shares need to see this now.
Because Mark Rogers — The Motley Fool UK’s Director of Investing — sees 2 key reasons why energy is set to soar.
While sanctions slam Russian supplies, nations are also racing to achieve net zero emissions,
he says. Mark believes 5 companies in particular are poised for spectacular profits.
Open this new report — 5 Shares for the Future of Energy
— and discover:
- Britain’s Energy Fort Knox, now controlling 30% of UK energy storage
- How to potentially get paid by the weather
- Electric Vehicles’ secret
backdoor
opportunity
- One dead simple stock for the new nuclear boom
Click the button below to find out how you can get your hands on the full report now, and as a thank you for your interest, we’ll send you one of the five picks — absolutely free!
Grab your FREE Energy recommendation now
More reading
Sumayya Mansoor has no position in any of the shares mentioned. The Motley Fool UK has recommended RELX. Views expressed on the companies mentioned in this article are those of the writer and therefore may differ from the official recommendations we make in our subscription services such as Share Advisor, Hidden Winners and Pro. Here at The Motley Fool we believe that considering a diverse range of insights makes us better investors.
News Related
-
, Nov. 28 — One of the most anticipated Android releases for 2023 has been the Google Pixel 8 lineup. The Pixel series is often considered the best of what Android has to offer since it brings the true stock Android experience. The Pixel 8 Pro was globally released on ...
See Details:
Google Pixel 8 Pro Review: Is this the best Android phone of 2023?
-
A blank space or an (NR) indicates no readings received. An (e) indicates that the water level has been estimated. An (w) indicates that the conditions were very windy, resulting in an inaccurate reading. Omatjenne Dam does not have abstraction facilities. The dam contents are according to the latest dam ...
See Details:
Namwater Dam Bulletin on Monday 27 November 2023
-
Dhaka, Nov. 27 — Nobel laureate Dr Muhammad Yunus has been appointed chair of the international advisory board of Moscow’s Financial University (under the government of the Russian Federation). On November 23, he joined a high-level strategic meeting with Prof Stanislav Prokofiev, Rector of the Financial University, and his colleagues. ...
See Details:
Dr Yunus appointed chair of Moscow Financial University's international advisory board
-
In a pivotal encounter at the International Cricket Council (ICC) Twenty20 World Cup Africa Final Monday, the Cricket Cranes faced Nigeria, knowing that a win could significantly boost their chances of securing one of the coveted tickets to the 2024 T20 World Cup in West Indies and the USA.Nigeria won ...
See Details:
Victory over Nigeria puts Uganda on the brink
-
Capture 1 The Bank Ghana (BoG) Monetary Policy Committee (MPC) has maintained the key policy rate at 30 percent, while introducing additional liquidity management measures to address excess liquidity and reinforce the disinflation process. Announcing the committee’s decision on Monday following its 115th meeting, BoG Governor Dr. Ernest Addison said ...
See Details:
BoG holds policy rate at 30%, tightens liquidity measures
-
Renita Holmes has been displaced four times in the past three years by rising rents With sea levels rising around the globe, Miami, in the US state of Florida, is facing an urgent need to adapt. As property investors turn their gaze inland, away from the exclusive low-lying beach area, ...
See Details:
When sea levels rise, so does your rent
-
Picture2 In a groundbreaking moment, Mrs. Adelaide Siaw Agyepong, CEO-American International School, has achieved yet another milestone by being crowned ‘Icon of Inspiration and Impact for the Year 2023’. The crowning achievement took place in Accra, where Mrs. Siaw Agyepong surpassed contemporaries to clinch this prestigious title at the 5th ...
See Details:
American International School CEO honoured as ‘Icon of Inspiration and Impact’
-
Freetown’s streets were almost empty on Sunday after a curfew was imposed Gunmen in Sierra Leone attacked a military barracks and freed hundreds of prisoners in a “co-ordinated and properly planned” attack, the country’s information minister has said. Sierra Leoneans spent Sunday under a nationwide curfew amid disarray in capital ...
See Details:
Sierra Leone prison breaks co-ordinated - minister
-
Freetown’s streets were almost empty on Sunday after a curfew was imposed Gunmen in Sierra Leone attacked a military barracks and freed hundreds of prisoners in a “co-ordinated and properly planned” attack, the country’s information minister has said. Sierra Leoneans spent Sunday under a nationwide curfew amid disarray in capital ...
See Details:
Address the rise of single parenthood
-
Freetown’s streets were almost empty on Sunday after a curfew was imposed Gunmen in Sierra Leone attacked a military barracks and freed hundreds of prisoners in a “co-ordinated and properly planned” attack, the country’s information minister has said. Sierra Leoneans spent Sunday under a nationwide curfew amid disarray in capital ...
See Details:
Hyundai Chief Picked as Auto Industry Leader of the Year
-
Freetown’s streets were almost empty on Sunday after a curfew was imposed Gunmen in Sierra Leone attacked a military barracks and freed hundreds of prisoners in a “co-ordinated and properly planned” attack, the country’s information minister has said. Sierra Leoneans spent Sunday under a nationwide curfew amid disarray in capital ...
See Details:
Unmarried People Under 35 Outnumber Married Ones
-
Freetown’s streets were almost empty on Sunday after a curfew was imposed Gunmen in Sierra Leone attacked a military barracks and freed hundreds of prisoners in a “co-ordinated and properly planned” attack, the country’s information minister has said. Sierra Leoneans spent Sunday under a nationwide curfew amid disarray in capital ...
See Details:
European interior ministers in Hungary to discuss migration
-
Freetown’s streets were almost empty on Sunday after a curfew was imposed Gunmen in Sierra Leone attacked a military barracks and freed hundreds of prisoners in a “co-ordinated and properly planned” attack, the country’s information minister has said. Sierra Leoneans spent Sunday under a nationwide curfew amid disarray in capital ...
See Details:
Japan on the watch for unlicensed taxis around Narita airport amid foreign tourism spike
-
Freetown’s streets were almost empty on Sunday after a curfew was imposed Gunmen in Sierra Leone attacked a military barracks and freed hundreds of prisoners in a “co-ordinated and properly planned” attack, the country’s information minister has said. Sierra Leoneans spent Sunday under a nationwide curfew amid disarray in capital ...
See Details:
ECOWAS to send high-powered delegation on solidarity visit to Sierra Leone
OTHER NEWS
Despite doing education at the university, Mellon Kenyangi, also known as Mama Bear, did not think of going to class, and teaching students was her dream job.“Since it was not ...
Read more »
213 Sri Lanka Cricket’s Chairman of Selectors, Pramodya Wickramasinghe reported to the Sports Ministry’s Special Investigation Unit( SMSIU) for the Prevention of Sports Offences yesterday for the second day. He ...
Read more »
137 Malindu Dairy (Pvt) Ltd., a leading food production company in Sri Lanka, won the Silver Award in the medium-scale dairy and associated products category at the Industrial Excellence Awards ...
Read more »
Africans Urged to Invest Among themselves, Explore Investment Opportunities in Continent Addis Ababa, November 27/2023(ENA)-The Embassy of Angola in Ethiopia has organized lecture on the “Foreign Investment Opportunities in Angola ...
Read more »
144 The dynamic front row player Mohan Wimalaratne will lead the Police Sports Club Rugby team at the upcoming Nippon Paint Sri Lanka Rugby Major League XV-a-side Rugby Tournament scheduled ...
Read more »
Dozens of people living with disabilities from New Hope Inclusive in Entumbane, Bulawayo on Saturday last week received an early Christmas gift in the form of groceries. The groceries were ...
Read more »
The East African Community (EAC) Summit of Heads of State has admitted the Federal Republic of Somalia to the regional bloc, making it its 8th member country. The decision was ...
Read more »