Generative artificial intelligence (AI) can do a lot of amazing things today. But is it any good on the investing/stock-picking front? Recently, I asked ChatGPT to list five of the ‘best UK stocks to buy for 2025’ for me. Here’s a look at the names it came up with.
ChatGPT’s stock picks for 2025
I’ve listed the five stocks below. Apparently, these were chosen based on ‘current trends, solid financials, and growth potential’.
- Shell – ChatGPT said that Shell’s shift toward renewables and clean technologies could position it well for growth in 2025.
- AstraZeneca (LSE: AZN) – The chatbot told me that AstraZeneca’s strong research and development capabilities, partnerships, and product launches could make it a solid long-term growth stock.
- Diageo – According to ChatGPT, Diageo remains a solid long-term investment due to its strong brand portfolio, international reach, and stable dividend payments.
- Unilever – The app told me that Unilever’s sustainability efforts are expected to attract increasing interest from environmentally-conscious consumers and investors.
- Tesco – ChatGPT reckons Tesco’s growing online grocery business and expansion into new services like banking and telecoms may offer growth drivers.
My initial thoughts
Now, when the app spat out this list of names, I had several initial thoughts.
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One was that these were quite lazy choices. All of these companies are large-cap FTSE 100 businesses. And all are very well known. I was hoping for some more obscure stock picks (with the potential to smash the market).
Another observation was that it hadn’t really done any real analysis. For example, there was no mention of revenue or earnings growth, potential to deliver better-than-expected earnings, return on capital, or valuations.
Additionally, some of the information looked a little off. For example, Tesco recently sold its banking division while Unilever has actually been dialling down its sustainability efforts.
Some decent picks
Having said all that, there are a couple of decent picks to be fair.
For example, I personally think pharma giant AstraZeneca looks quite interesting at current levels. Its share price has pulled back in recent months, and with the price-to-earnings (P/E) ratio now sitting at 14, I reckon there’s some value on offer at current levels.
One thing ChatGPT didn’t mention with this stock was that in November, several directors – including the CEO and the chairman – bought a ton of shares. Combined, the insiders invested more than £2m in the company, which suggests they believe the stock will rebound.
It also didn’t mention that AstraZeneca’s revenue and earnings are projected to grow by 7.3% and 14.3% respectively in 2025. That’s a healthy level of growth.
Additionally, it didn’t highlight any risks. And there are a few here, including ongoing regulatory investigations in China.
Overall though, I think it’s a decent large-cap stock pick. I believe it’s worth considering for 2025.
Johnnie Walker and Guinness owner Diageo – a great long-term performer – is also worth considering at current levels, in my view. I already own some shares here but I’m tempted to buy a few more as they’ve come down in price significantly recently.
I’m going to track performance
What I’m going to do however, is put these five shares into a spreadsheet and track their performance this year. Let’s see if ChatGPT can beat the FTSE 100…
