Three AI Stocks Leading Growth Investment
Written by Emily J. Thompson, Senior Investment Analyst
Updated: 1 hour ago
0mins
Should l Buy NVDA?
Source: Fool
- Market Leader: Nvidia commands approximately 90% of the GPU market, benefiting significantly from AI infrastructure spending due to its cutting-edge chip designs and CUDA software platform, which are expected to drive long-term growth for the company.
- Cost Advantage: Alphabet gains a structural cost advantage by designing its own TPU chips, allowing it to train and run AI models more cheaply than competitors, while also starting to lease TPUs at scale, creating a new revenue stream.
- Industry Monopoly: Taiwan Semiconductor Manufacturing, as the leading chip manufacturer globally, has established a de facto monopoly in advanced chip production due to its unmatched technological expertise and scale, and is expected to maintain strong pricing power moving forward.
- Long-term Investment Value: All three companies trade at reasonable forward P/E ratios, with Nvidia at 23.5, Alphabet at 26.5, and TSMC at 25.5, indicating their potential for long-term investment in the rapidly growing AI market.
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Analyst Views on NVDA
Wall Street analysts forecast NVDA stock price to rise
41 Analyst Rating
39 Buy
1 Hold
1 Sell
Strong Buy
Current: 187.980
Low
200.00
Averages
264.97
High
352.00
Current: 187.980
Low
200.00
Averages
264.97
High
352.00
About NVDA
NVIDIA Corporation is a full-stack computing infrastructure company. The Company is engaged in accelerated computing to help solve the challenging computational problems. The Company’s segments include Compute & Networking and Graphics. The Compute & Networking segment includes its Data Center accelerated computing platforms and artificial intelligence (AI) solutions and software; networking; automotive platforms and autonomous and electric vehicle solutions; Jetson for robotics and other embedded platforms, and DGX Cloud computing services. The Graphics segment includes GeForce GPUs for gaming and PCs, the GeForce NOW game streaming service and related infrastructure, and solutions for gaming platforms; Quadro/NVIDIA RTX GPUs for enterprise workstation graphics; virtual GPU software for cloud-based visual and virtual computing; automotive platforms for infotainment systems, and Omniverse Enterprise software for building and operating industrial AI and digital twin applications.
About the author
Emily J. Thompson
Emily J. Thompson, a Chartered Financial Analyst (CFA) with 12 years in investment research, graduated with honors from the Wharton School. Specializing in industrial and technology stocks, she provides in-depth analysis for Intellectia’s earnings and market brief reports.
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- Growing Market Demand: Expected capital expenditures from cloud service providers are projected to reach $650B in 2026, up from over $400B in 2025, reflecting sustained demand for Nvidia's products.
- New Product Outlook: The average selling price for Vera Rubin is expected to be 40% to 50% higher than that of GB300, potentially adding around $8B in revenue for Nvidia, further solidifying its market leadership.
- Market Size Expansion: With China now included, Nvidia's total addressable market is estimated to be around $4T, showcasing its dominant position in the global AI platform and future growth potential.
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- Weak Market Performance: Since August 2025, Nvidia's stock has only risen by 5%, significantly lagging behind the S&P 500's 10% gain, indicating market caution regarding its future growth despite optimistic prospects in the AI sector.
- Surge in Capital Expenditures: Amazon, Alphabet, and Meta expect to spend at least $500 billion in capital expenditures in 2026, positioning Nvidia as a primary beneficiary; if it maintains its market share, it could see substantial revenue growth, with global data center capital expenditures projected to reach $3 trillion to $4 trillion by 2030.
- China Market Resumption: Nvidia has regained the ability to export GPUs to China, re-entering the world's second-largest AI market; although the stock has not significantly reacted to this positive development, it provides new momentum for future growth.
- Attractive Valuation: With a forward P/E ratio of less than 24, Nvidia's stock appears cheap compared to the S&P 500's 21.9, suggesting that investors should consider buying during this pullback, especially with upcoming spending increases on the horizon.
See More
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- Market Leader: Nvidia commands approximately 90% of the GPU market, benefiting significantly from AI infrastructure spending due to its cutting-edge chip designs and CUDA software platform, which are expected to drive long-term growth for the company.
- Cost Advantage: Alphabet gains a structural cost advantage by designing its own TPU chips, allowing it to train and run AI models more cheaply than competitors, while also starting to lease TPUs at scale, creating a new revenue stream.
- Industry Monopoly: Taiwan Semiconductor Manufacturing, as the leading chip manufacturer globally, has established a de facto monopoly in advanced chip production due to its unmatched technological expertise and scale, and is expected to maintain strong pricing power moving forward.
- Long-term Investment Value: All three companies trade at reasonable forward P/E ratios, with Nvidia at 23.5, Alphabet at 26.5, and TSMC at 25.5, indicating their potential for long-term investment in the rapidly growing AI market.
See More
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- Surge in AI Infrastructure Investment: The five largest hyperscalers have committed to spending $700 billion by 2025 to expand cloud capacity, a figure exceeding the GDP of 24 countries, indicating strong demand for AI infrastructure that will drive growth for related companies.
- Nvidia's Market Dominance: Nvidia holds approximately 90% of the GPU market share, with its chips being the primary processors for AI workloads; its cutting-edge chip designs and CUDA software platform have established a strong moat, positioning the company to benefit from the ongoing AI boom.
- Alphabet's Technological Edge: Alphabet boasts the most complete AI tech stack, including the leading large language model Gemini and proprietary TPU chips, enabling it to train and run AI models at lower costs, thereby reinforcing its market leadership.
- TSMC's Growth Potential: As the world's leading chip manufacturer, TSMC is significantly ramping up production capacity and plans to raise prices over the next four years; with its technological expertise and scale, it is expected to maintain a crucial role in the booming AI infrastructure market.
See More
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- CIBC Rating Upgrade: Barclays upgrades CIBC from underweight to overweight, highlighting the bank's progress over the past two years with ROE expansion and consistent earnings performance, suggesting significant growth potential and investment appeal in the Canadian market.
- Credo Technology Buy Rating: Goldman Sachs initiates coverage of Credo Technology with a buy rating and a 12-month price target of $165, indicating a favorable risk/reward profile and confidence in the company's future growth.
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- Retail Investor Interest: Tesla stock continues to attract retail investors despite experiencing recent declines in its value.
- Market Sentiment: The ongoing popularity among retail investors suggests a strong belief in Tesla's long-term potential, even amid short-term fluctuations.
See More
Nvidia's Q4 Earnings Outlook Shows Strong Potential
- Earnings Potential Analysis: Oppenheimer anticipates Nvidia's Q4 sales could see a typical upside of $2B to $3B, primarily driven by the GB300 Ultra, indicating strong performance in the AI sector.
- Growing Market Demand: Expected capital expenditures from cloud service providers are projected to reach $650B in 2026, up from over $400B in 2025, reflecting sustained demand for Nvidia's products.
- New Product Outlook: The average selling price for Vera Rubin is expected to be 40% to 50% higher than that of GB300, potentially adding around $8B in revenue for Nvidia, further solidifying its market leadership.
- Market Size Expansion: With China now included, Nvidia's total addressable market is estimated to be around $4T, showcasing its dominant position in the global AI platform and future growth potential.
See More
Nvidia's Stock Pullback Presents Investment Opportunities
- Weak Market Performance: Since August 2025, Nvidia's stock has only risen by 5%, significantly lagging behind the S&P 500's 10% gain, indicating market caution regarding its future growth despite optimistic prospects in the AI sector.
- Surge in Capital Expenditures: Amazon, Alphabet, and Meta expect to spend at least $500 billion in capital expenditures in 2026, positioning Nvidia as a primary beneficiary; if it maintains its market share, it could see substantial revenue growth, with global data center capital expenditures projected to reach $3 trillion to $4 trillion by 2030.
- China Market Resumption: Nvidia has regained the ability to export GPUs to China, re-entering the world's second-largest AI market; although the stock has not significantly reacted to this positive development, it provides new momentum for future growth.
- Attractive Valuation: With a forward P/E ratio of less than 24, Nvidia's stock appears cheap compared to the S&P 500's 21.9, suggesting that investors should consider buying during this pullback, especially with upcoming spending increases on the horizon.
See More
Three AI Stocks Leading Growth Investment
- Market Leader: Nvidia commands approximately 90% of the GPU market, benefiting significantly from AI infrastructure spending due to its cutting-edge chip designs and CUDA software platform, which are expected to drive long-term growth for the company.
- Cost Advantage: Alphabet gains a structural cost advantage by designing its own TPU chips, allowing it to train and run AI models more cheaply than competitors, while also starting to lease TPUs at scale, creating a new revenue stream.
- Industry Monopoly: Taiwan Semiconductor Manufacturing, as the leading chip manufacturer globally, has established a de facto monopoly in advanced chip production due to its unmatched technological expertise and scale, and is expected to maintain strong pricing power moving forward.
- Long-term Investment Value: All three companies trade at reasonable forward P/E ratios, with Nvidia at 23.5, Alphabet at 26.5, and TSMC at 25.5, indicating their potential for long-term investment in the rapidly growing AI market.
See More
Nvidia and Others Poised for Growth from AI Infrastructure Expansion
- Surge in AI Infrastructure Investment: The five largest hyperscalers have committed to spending $700 billion by 2025 to expand cloud capacity, a figure exceeding the GDP of 24 countries, indicating strong demand for AI infrastructure that will drive growth for related companies.
- Nvidia's Market Dominance: Nvidia holds approximately 90% of the GPU market share, with its chips being the primary processors for AI workloads; its cutting-edge chip designs and CUDA software platform have established a strong moat, positioning the company to benefit from the ongoing AI boom.
- Alphabet's Technological Edge: Alphabet boasts the most complete AI tech stack, including the leading large language model Gemini and proprietary TPU chips, enabling it to train and run AI models at lower costs, thereby reinforcing its market leadership.
- TSMC's Growth Potential: As the world's leading chip manufacturer, TSMC is significantly ramping up production capacity and plans to raise prices over the next four years; with its technological expertise and scale, it is expected to maintain a crucial role in the booming AI infrastructure market.
See More
Latest Rating Changes on Wall Street
- Nvidia Outlook Positive: Oppenheimer reiterates its outperform rating on Nvidia, anticipating sustained outsized growth in high-performance gaming, datacenter/AI, and autonomous driving, indicating strong market demand and future profitability potential.
- CIBC Rating Upgrade: Barclays upgrades CIBC from underweight to overweight, highlighting the bank's progress over the past two years with ROE expansion and consistent earnings performance, suggesting significant growth potential and investment appeal in the Canadian market.
- Credo Technology Buy Rating: Goldman Sachs initiates coverage of Credo Technology with a buy rating and a 12-month price target of $165, indicating a favorable risk/reward profile and confidence in the company's future growth.
- Chewy Rating Upgrade: Raymond James upgrades Chewy from market perform to outperform, noting an attractive EV/EBITDA of approximately 8x, combined with topline and margin opportunities in 2026, highlighting the stock's appeal.
See More
Tesla Shares Decline: Reasons Retail Investors Continue to Purchase Along with Micron and Microsoft.
- Retail Investor Interest: Tesla stock continues to attract retail investors despite experiencing recent declines in its value.
- Market Sentiment: The ongoing popularity among retail investors suggests a strong belief in Tesla's long-term potential, even amid short-term fluctuations.
See More
