Artificial intelligence (AI) stocks remain some of the biggest investment opportunities out there for investors. After all, these are companies that are part of the future, but in more ways than answering your day-to-day questions on ChatGPT.
In fact, AI is the future in one of the most important areas: supply chain management. Remember when we couldn’t get a hold of practically anything during the pandemic? That’s supply chain management. Supply chains were bogged down, and companies like Kinaxis (TSX:KXS) were there to help, even training smaller companies in how to manage them effectively. Today, the company has even more opportunities, so let’s get into them.
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About KXS
First, let’s look at this supply-chain management company a bit further. Kinaxis is a Canadian software company based in Ottawa. While a Canadian company, it operates on a global scale, helping businesses anticipate disruptions, streamline operations, and make better business decisions.
How does it do that? This is where AI comes in. Kinaxis stock has a RapidResponse platform. This powers concurrent planning, instantly recalculating supply, demand, inventory and more for any data changes. It also evolved this platform into Maestro, an AI-driven, end-to-end tool that spans from sales to operations and control towers for real-time execution.
What’s more, it’s not some small businesses latching onto Kinaxis. The company boasts deals with Ford, Cisco, Qualcomm and more. These are recurring revenue streams usually lasting between two and five years. And what’s more, the company never has more than 5% of its company taken up by one business. That makes it safe and secure for today’s investor.
Into earnings
This power can be seen in the company’s earnings. Kinaxis stock recently reported strong earnings for the second quarter; in fact, its strongest second quarter ever! Revenue jumped 15% to $136.4 million. This included a 17% increase in software-as-a-service (SaaS) revenue and a huge 270% jump in subscription term licenses.
What’s more, gross profit went up 64%, showing the strength of its subscription business. As the company started deploying more AI capabilities, the AI stock is looking to attract even more business. This helped the decision in its 2025 guidance, projecting revenue between $535 and $550 million, and SaaS growth between 13% and 15%.
Yet amongst all this, Kinaxis stock still holds value. Yes, its price-to-earnings (P/E) ratio at 157.7 is very high. Yet the growth potential for this company is immense. It offers the unique position of growth in AI, while also providing the security and stability of a supply stock.
Bottom line
New investors will love this AI stock. Not just for growth in the next year or two, but for decades to come. It’s an AI stock that offers immense wealth for those patient enough to hold onto it. And trust me, you’ll want to hold onto it for years to come. So forget the AI stocks that promise quick growth. If you want true wealth, consider this AI stock Canadians continue to sleep on.
