SA Asks: OpenAI or Anthropic -- which is the better investment?

AI developers OpenAI (OPENAI) and Anthropic (ANTHRO) are both reportedly gearing up for potentially massive IPOs later this year.

Microsoft (MSFT) still holds a major stake in OpenAI, while Anthropic counts Amazon (AMZN) and Alphabet (

Analysts favor Anthropic for its lower valuation and unique strengths, though both companies have significant backing and potential.

OpenAI is considered highly overvalued and deeply unprofitable, while Anthropic is seen as more fairly valued and possibly on track to profits sooner according to some projections.

Major risks include high valuations, expected continued cash burn, uncertain profitability of LLM business models, and potential disputes or regulatory issues (especially for Anthropic).