US tech stocks have been hot property over the past few months. Even though I can easily buy US stocks from this side of the pond, there are tech-related companies right here in the UK. In fact, here are two within the FTSE 100 that are worth considering for investors.
Tailored entertainment
First up is Entain (LSE:ENT). The sports betting and entertainment company might not sound like a tech stock, but hear me out.
The business is heavily focused around the Entain Platform, which is the base from which it can offer out betting services to clients. Fuelling new initiatives is the new innovation hub, which was set up in 2022. Both the lab and the platform are based around pushing tech boundaries to provide a smarter entertainment experience for the end user.
Looking forward, artificial intelligence (AI) stands to play a large part in the future success of the business. The ability for AI models to use sophisticated analytics, behavioural indicators, and data science will help to make Entain more profitable. Given that it’ll allow it to create a more bespoke user experience, it should also help retain more customers.
Granted, that all sounds good but the share price is down 30% over the past year. I think part of this is some disappointment that the growth in the US business hasn’t been as strong as expected. Further, the HMRC investigation into the Turkey operations was damaging to the company reputation.
Ultimately, I don’t see either as being a long-term risk and feel the investment in tech will yield results in coming years.
Using AI for creativity
Another option for tech investors is WPP (LSE:WPP). The global advertising and communications firm has always kept up with new tech relating to marketing, but it has been pushing much harder in this regard recently.
For example, in the summer of last year the company partnered with Nvidia (the global poster child of AI). The two brands are developing a content engine that will allow the WPP creative teams to “produce high-quality commercial content faster, more efficiently and at scale.”
Added to this was the news last month that WPP was going to commit £250m annually towards AI transformation. It appears to me that the business is taking this seriously, hence why I’ve included it as a tech stock to watch carefully.
The stock is down 31% over the past year, which doesn’t inspire confidence. The full-year results that just came out saw the profit after tax hit the lowest level since 2020. The business has seen a slowdown in advertising spend from businesses feeling the pinch. This was most felt in the US market.
Even with this being a risk, I think that lower interest rates and lower inflation this year should see pressure ease on many. This should help spending to pick up for key clients for WPP.
I’m considering adding both stocks to my portfolio shortly. For investors that are looking for different options for tech exposure, I think they are worth considering.
The post 2 tech treasures lurking in the FTSE 100 appeared first on The Motley Fool UK.
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Jon Smith has no position in any of the shares mentioned. The Motley Fool UK has recommended Nvidia. Views expressed on the companies mentioned in this article are those of the writer and therefore may differ from the official recommendations we make in our subscription services such as Share Advisor, Hidden Winners and Pro. Here at The Motley Fool we believe that considering a diverse range of insights makes us better investors.
