My 3 Favorite Artificial Intelligence (AI) Stocks to Buy Right Now
Prosper Junior Bakiny, The Motley Fool
Tue, July 28, 2026 at 11:50 AM GMT+5:30
4 min read
- NVDA
-4.99% - GOOG
+2.34% - AMZN
-0.31%
Missed Nvidia in 2009? This Rare Signal Is Flashing Again. In 2009, a “Double Down” signal flashed for a little-known chipmaker called Nvidia. For the first time in years, that same “Total Conviction” signal is flashing for a company 1/100th the size of Nvidia. Continue »
1. Nvidia
Nvidia is at the very center of the AI revolution. The company’s GPUs (Graphics Processing Units) are the most important hardware for AI training, and it has kept a large lead in this niche by making GPUs whose raw performance beats that of competitors, not to mention Nvidia’s CUDA ecosystem, which provides a wide moat from switching costs. Some investors think Nvidia may not maintain its momentum for much longer, but the fact that AI infrastructure spending continues to grow at a good clip suggests otherwise.
The hyperscalers are pouring small fortunes on capex and planning to spend even more, as is the case with Alphabet. Beyond major cloud providers, companies in other industries, including Tesla (NASDAQ: TSLA) — an electric vehicle maker — and Bristol Myers Squibb (NYSE: BMY), a pharmaceutical leader, are also ordering Nvidia’s GPUs. Sustained demand for its products could make Nvidia one of the biggest winners in the long run, as the AI industry continues to expand
2. Alphabet
Alphabet’s business — from advertising to cloud computing — is improving thanks to AI. For instance, the company is increasing search volume through AI modes and AI overviews, helping boost ad demand. Meanwhile, Google Cloud offers AI services that allow businesses to build, customize, and deploy AI applications and agents. Google Cloud’s year-over-year revenue growth has been accelerating — 48% in the fourth quarter of 2025, 63% in Q1 2026, and 82% in Q2
It’s hard to argue with these results, and given that Alphabet is doubling down and planning to spend even more to capitalize on the technology, it should remain one of the leaders in the medium term. Some investors see Alphabet’s spending as a bearish sign, especially since it recorded a negative free cash flow in the second quarter. But Alphabet’s $514 billion cloud backlog as of the second quarter tells a different story, as it suggests it may keep growing its cloud sales at a good clip over the next few quarters, at least. Investors should stick with Alphabet to cash in on AI.
