Wednesday's IBD 50 Stocks To Watch pick is artificial intelligence play Samsara (IOT), which is currently finding support at a critical level on the stock market today. That makes the AI stock leader one of the best ideas to buy and watch right now.
Founded in 2015, Samsara provides sensors and cloud-based software to manage vehicle fleets and industrial operations. Also, its Internet of Things platform provides global positioning tracking for trucks, and monitors routes and vehicle performance.
↑ XIn 2018, Samsara expanded into video-based safety products. These enabled fleet customers to lower vehicle insurance costs.
In-cab, dual-facing cameras provide real-time video streaming. Also, artificial intelligence software at cloud data centers detects high-risk behavior, such as distracted driving and lane departures.
On Sept. 5, Samsara's second-quarter earnings and revenue topped Wall Street targets amid strong growth in large accounts. Samsara reported earnings of 5 cents per share on an adjusted basis, versus a 1-cent profit a year earlier. Meanwhile, Q2 revenue rose 37% to $300 million, the company said.
For fiscal 2025 ending in January, Wall Street expects the company's earnings to jump 149% to 17 cents per share, with an increase of 52% in fiscal 2026, per IBD MarketSurge.
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After hitting the 20%-25% profit-taking range from a 39.21 cup-with-handle entry, AI stock Samsara is pulling back to 10-week moving average, a key level to watch.
As the stock rebounds from the line, Samsara shares are in a new buy area. When the stock found support, the 10-week line measured 46.69. Using that as the entry, the 5% buy zone runs up 49.02.
A technical factor to watch is the stock's relative strength line, which is holding near its recent highs. Look for that indicator to reemerge to new highs in the near future if the stock is able to extend its rebound.
Due to long-term earnings strength and strong price action this year, Samsara boasts a near-ideal 98 IBD Composite Rating, according to IBD Stock Checkup.
Further, market risk remains low, and investors should be looking to maintain an exposure level of 80%-100%. And the AI stock is among the best ideas.
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Three recent IBD 50 Growth Stocks To Watch picks are among the best stocks to buy and watch.
| Company | Symbol | Buy point | Type of base |
|---|---|---|---|
| Trade Desk | (TTD) | 121.44 | Tight area |
| Nvidia | (NVDA) | 140.76 | Consolidation |
| Hims & Hers Health | (HIMS) | 23.74 | Cup with handle |
Follow Scott Lehtonen on X at @IBD_SLehtonen for more on the best stocks to buy and watch and the Dow Jones Industrial Average.
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