Investing in AI stocks to buy might be your ticket to financial freedom.
AI stocks have grown staggeringly over the past 12 months, driving equity markets to record highs. Yet, those impressive gains are just the beginning. With the AI sector, valued at $184 billion in 2024, poised to skyrocket past $826 billion by 2030, the best is yet to come.
Amidst this rapid expansion, there is still ample opportunity to buy the best AI stocks and continue reaping the rewards. Moreover, with the interest rate cuts expected at the end of the year, the sector’s momentum is expected to intensify further.
These three AI stocks represent the sector’s finest, moving the needle for massive long-term gains. These companies have been growing at an impressive rate of late and are positioned for even greater gains, making them top picks for AI stocks to buy today.
AI Stocks to Buy: Nvidia (NVDA)
Nvidia (NASDAQ:NVDA) is a no-brainer AI pick set to continue its dominance for years. AI has been arguably the biggest catalyst for the chip giant, briefly surging past the $3 trillion valuation mark to become the most valuable company.
Moreover, we’re still in the genesis stages of the current AI boom, pointing to a massive growth runway ahead for Nvidia. The firm continues leading the competition with its cutting-edge AI chips, with Blackwell set to release this year and Rubin in 2026. Also, on the financial front, NVDA continues firing on all cylinders, with growth rates exceeding 200%.
Despite the significant surge in NVDA stock last year, Wall Street remains overwhelmingly positive about its long-term potential. 38 analysts have given NVDA stock a ‘strong buy’ rating, with no analysts issuing a ‘sell’ rating. This consensus underscores the market’s confidence in Nvidia’s position, solidifying its status as the top AI company to buy.
Amazon (AMZN)
Tech giant Amazon (NASDAQ:AMZN) has supercharged its recent financial performances, including a 200% jump in the first quarter (Q1) of 2024.
At the heart of its success is Amazon’s cloud computing powerhouse in AWS, a key driver for its top-and-bottom-line expansion. Amazon has done an excellent job leveraging its massive AWS client base to promote AI innovations and solidify its market position.
The impact of this strategy was on full display during Q1, when AI sales were up 17%, along with an 84% boost in operating income on a year-over-year (YOY) basis. Hence, AWS has swiftly become a powerhouse for Amazon, contributing 60% to its overall operating income.
As we look ahead, generative AI within AWS could unlock $600 billion in new software revenue by 2028. Therefore, Amazon has a lucrative future ahead, with analyst consensus estimates pointing to a 17% upside from current prices.
Broadcom (AVGO)
Broadcom (NASDAQ:AVGO) is a juggernaut in semiconductor and infrastructure software solutions, and it is critical to powering AI.
The chipmaker has long been a giant in the sector, with recent AI chips accelerating its top-line growth. Moreover, last year’s acquisition of VMware is starting to pay dividends, with Broadcom posting a 175% surge in infrastructure software sales, reaching $5.3 billion in the second quarter (Q2). Moreover, VMware products’ annualized booking value (ABV) also rose from $1.2 billion to $1.9 billion, showcasing powerful client adoption and revenue visibility.
However, the show’s star is still its semiconductor solutions division, which comprises almost 60% of its overall sales. The division generated $7.2 billion in Q2, a 6% YOY increase. Additionally, its networking division experienced a substantial 44% revenue increase during Q2, driven by heightened AI networking demand.
Hence, Broadcom’s recent results underscore its dominance and bright prospects in the AI-driven tech landscape.
On the date of publication, Muslim Farooque did not have (either directly or indirectly) any positions in the securities mentioned in this article. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.com Publishing Guidelines.
