Editor's note: Artificial intelligence ("AI") is redefining the future...

With companies looking to capitalize on AI's rapid growth, many businesses are implementing this technology into their hiring systems.

Joel Litman – chief investment officer for our corporate affiliate Altimetry – believes this trend will lead to lucrative buying opportunities for investors who are paying attention.

In today's Masters Series, originally from the April 23 issue of the free Altimetry Daily Authority e-letter, Joel explains how you can position yourself to profit from corporations embracing AI-focused strategies... 

AI Is Reshaping the Corporate Playbook

By Joel Litman, chief investment officer, Altimetry

Shopify's (SHOP) recent hiring freeze could redefine the U.S. workforce...

The e-commerce giant announced it will only approve new hires for roles that artificial intelligence ("AI") can't fill.

This comes on the heels of similar decisions by technology giant IBM (IBM)... and even smaller companies like Klarna, which provides payment solutions.

They're all pursuing an "AI first" strategy, mirroring Elon Musk's Department of Government Efficiency ("DOGE") mandate for the U.S. government.

Altogether, this illustrates a growing trend among tech companies to double down on AI capabilities. It's what they need to continue evolving... and dominate the competition.

Today, we'll explore how Shopify's AI-driven strategy is leading the pack... This technology could unlock big cost savings, boost profitability, and meet growing investor expectations. And, just as important, it's not the only company capitalizing on this trend.

AI is already shifting the company's financial outlook...

Analysts have long speculated that AI could reduce operational costs, optimize products, and enhance user experience. And now, we're finally seeing tangible actions and results.

Shopify's pivot to AI is a strategic bet on efficiency and growth.

The company has already leveraged AI tools, like Sidekick and Shopify Magic, to boost productivity... These tools are helping merchants streamline and automate routine tasks.

With an AI-focused hiring approach, Shopify will scale its offerings without significantly growing its workforce. This will keep company costs in check.

Simply put, the company is using AI to redefine the future of work in the U.S. And, luckily, investors are catching on to the trend...

In fact, they seem to understand Shopify's full potential...

We can see this through our Embedded Expectations Analysis ("EEA") framework.

The EEA starts by looking at a company's current stock price. From there, we can calculate what the market expects from the company's future cash flows. We then compare that with our own cash-flow projections.

In short, it tells us how well a company has to perform in the future to be worth what the market is paying for it today.

The company's Uniform return on assets ("ROA") has hovered around 23% since 2019. (We're setting aside two outlier years due to the COVID-19 pandemic.)

Analysts are projecting a Uniform ROA of 36% by 2026, thanks to the surge in the company's AI initiatives.

Similarly, investors expect Shopify's profitability to continue expanding and its Uniform ROA to reach an impressive 80% by 2029. Take a look...

In other words, the market is already pricing in Shopify's future gains from AI technology.

Wall Street has similar expectations for IBM... Its Uniform ROA is expected to improve over the next few years as a result of rapid AI growth.

This underscores just how powerful these tech investments can be. And it's encouraging smaller players (like Klarna) to get on the AI bandwagon, too...

That's why investors should look beyond the usual suspects...

Shopify's AI-focused strategy highlights an important evolution... Businesses must keep up with the latest technology to compete in this fast-paced environment.

Right now, AI is revolutionizing the corporate playbook. And the companies that embrace this technology – big and small – could see exponential growth.

Folks, there are many potential AI winners out there. What's happening at Shopify will play out at scale in the wider economy...

Lots of smaller, under-the-radar companies may become critical players in the value chain. And they may offer even bigger upside potential than Shopify.

Regards,

Joel Litman

Editor's note: This isn't the only shift in the AI sphere we're monitoring right now...

We're less than two weeks away from DOGE's "Phase II." While this story has flown under the radar in the mainstream media, Joel has been closely following this development in order to pounce on the opportunities it will create.

So he recently went on camera to reveal how you can capitalize on the aftermath of the government's plans for AI growth – including four specific stocks that are set to explode higher as a result. Learn more here...