New Trade for June 14th, 2023

Investors have been pouring into rapidly developing AI tech names over the past few months and this is likely just the beginning.  According to Grand View Research, the global artificial intelligence market reached a valuation of $136.55 billion in 2022.  It’s projected that by 2030 the industry will command a revenue of nearly $1.9 trillion.  

There’s no denying – AI stocks are red hot.  Our recommendation for today is a company set for massive near-term growth.  Industry experts are calling for a 367% share price increase for this little-known stock over the next twelve months.  Don’t miss your chance to get in before it takes off.  

FARO Technologies, Inc. (FARO)

It’s not uncommon for small tech companies to lose money for years before finding success.  However, it is why investors have been hesitant about three-dimensional measurement solutions developer Faro Technologies since it boosted investment sharply in the last year, with cash burn ramping by 64%.  That does raise some red flags, and there’s no solace in the operating revenue growth of 2.4% in the same time frame.  Clearly, however, the crucial factor is whether the company will grow its business going forward.  

FARO’s latest offering is its cloud-based information platform, Sphere. With Sphere, users are able to leverage artificial intelligence and machine learning to automate time-consuming and repetitive tasks.  Sphere enables faster 3D data capture, processing and project management for engineering and construction projects.  We expect this technology to grow and develop along with AI and don’t see the company’s extra spending as a deterrent.   

Its cash burn of $42 million is about 8.7% of its $478 million market cap. That’s a low proportion and stands out as evidence that the company is well on top of its spending.  Considering the potential for advancement for this micro-cap, the pros on Wall Street are beginning to take notice.  The five analysts offering recommendations for the stock say to Buy FARO, with no Sell recommendations.  A median 12-month price target of $22 represents an increase of 47% from the current price. A high estimate of $57 indicates a 367% upside potential over the next twelve months.

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