Thales is latest Barron’s stock pick due to AI capabilities (Pink Limited Info:THLEF)

Barron’s has selected defense, security, and aeronautics stock Thales S.A. (OTCPK:THLEF) as its latest stock pick citing the French company incorporating artificial intelligence more and more in its offerings.

Thales (OTCPK:THLLY) has three segments: defense and security, aeronautics and space, and digital identity and security. In Q1 2024, the first unit brought in about 52% of the company’s total revenue.

Barron’s also noted that the defense & security business saw the most growth with sales up 13.1% over the past 12 months and orders rising 128%. Thales just reiterated guidance made in March that it is seeking organic sales growth of 4%-6% in 2024 and for its margins to rise to as much as 12%.

But the financial newspaper said that the company’s artificial intelligence services, which is being included in many of its offerings, is aiding growth. In Q4, Thales booked 13 large orders, which included a €2B contract with the U.K. Ministry of Defence for the Royal Navy involving AI as well as with the United Arab Emirates for training on Rafale fighter jets.

At its media day in late March, Thales (OTCPK:THLEF) said it had formed cortAIx, an “AI accelerator designed to expand the integration of AI technology into all of the company’s sectors of activity.”