In the realm of investing in tech, the discussion around artificial intelligence has been dominating the headlines recently. While companies like Nvidia, Alphabet, and Microsoft have been in the spotlight, there is one stock flying under the radar according to Trent Masters, a portfolio manager at Alphinity Investment Management. Masters points towards telecommunications giant Motorola Solutions as a hidden gem in the AI landscape, calling it a “very beautiful, solid, public safety-focused business.”
Contrary to common perception, Motorola Solutions is not just about phones. Masters emphasizes that the core of the business is centered around being a facilitator of public safety. With approximately 70% of the business dedicated to Land Mobile Radio (LMR), which provides essential communication tools for first responders, the company also houses video security and building command center units. This diversified portfolio is what makes Motorola Solutions an intriguing investment opportunity.
Masters is notably bullish on the stock, citing the ongoing upgrade cycle in Motorola’s LMR business as a key driver for growth. With new devices commanding higher prices, coupled with the expanding market presence of the video security and command center units, the company is well-positioned for sustained success. The element of public safety and government spending further strengthens the case for investing in Motorola Solutions, especially in uncertain market environments.
While AI may not be the primary driver for Motorola Solutions, Masters sees opportunities for leveraging artificial intelligence to enhance growth. One potential application highlighted by Masters is in the video security solutions segment, where AI can play a crucial role in identifying threats like individuals carrying weapons and regulating access to secure facilities. Despite not being a pure play in the AI space like Nvidia or Microsoft, Motorola Solutions shows promise in integrating AI technologies into its existing business model.
Traded on the New York Stock Exchange, Motorola Solutions has shown impressive performance, with shares up over 18% year to date and over 30% in the last 12 months. This solid track record has garnered positive sentiment from analysts, with nine out of 15 analysts covering the stock giving it a buy or overweight rating. The average price target of $376.38 reflects a slight downside potential, signaling room for further growth in the coming months.
Motorola Solutions stands out as an underrated artificial intelligence gem in the tech investment landscape. With a focus on public safety, a diversified business model, and potential for AI integration, the company presents a compelling opportunity for investors looking to capitalize on the future of technology and innovation.
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