Stocks to buy

3 AI Stocks (Not Named Nvidia) With Upside Galore in 2024

Nvidia (NASDAQ:NVDA) remains the focal point of many investors, given its impressive recent performance. These past few months, investor attention has almost entirely been taken up assessing the growth potential of AI stocks, with Nvidia leading the way.

The company’s high-powered H100 AI chips and A100 GPUs remain the market standard, and have allowed Nvidia to dominate the imagination of investors, as the company continues to raise the bar and blow out earnings expectations.

However, after reaching an incredible market capitalization of more than $2 trillion this past week, the question remains whether this momentum can continue. Indeed, trees don’t grow to the sky, and higher returns tend to go to under-appreciated smaller-cap stocks.

So, for investors looking to play the AI revolution but are seeking stocks that may not be priced to perfection as of yet, here are three of my top AI stocks to consider right now.

Amazon (AMZN)

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As the leader in the e-commerce space and among the most popular Magnificent Seven companies, Amazon (NASDAQ:AMZN) has been a long-term player in the world of AI, with its core e-commerce platform using artificial intelligence and various algorithms to improve users’ experience for a very long time. It’s definitely one of those AI stocks to consider.

Amazon is now focusing on using AI to retain its dominant market position in the cloud, via the company’s Amazon Web Services (AWS). The company has room to advance in the world of cloud-based AI applications, and in some respects, Amazon lags key competitors in this space. Analysts think the company needs around 6 months to a year to catch up, but given the size of Amazon’s pockets and the performance of its core business, it might not take that long.

Amazon’s AWS cloud platform is set to drive AI advancement by offering powerful computing tools. With in-house-designed chips like Graviton4 and Trainium2, along with Nvidia’s H200 and GH200 Grace Hopper Superchips, AWS aims to support diverse AI applications despite competition from Microsoft and Alphabet, Amazon’s aggressive AI infrastructure development positions it as a key player in AI’s future.

Fortune Business Insights’ research projected 20% annual growth for Amazon, with the global cloud computing market reaching a $2.4 trillion valuation by 2030. With AWS’s longstanding market dominance, Amazon remains essential for long-term growth portfolios, and it remains a relatively sneaky AI pick I think many investors are overlooking right now.

Advanced Micro Devices (AMD)

Source: Pamela Marciano /

As Nvidia’s top rival, Advanced Micro Devices (NASDAQ:AMD) has the potential to roar higher in 2024, creating more AI chip innovations for various applications. In 2024, AMD will prove the company is another dominant and effective player in the world of AI and semiconductor manufacturing. 

AMD unveiled the MI300x GPU chipset in Q2 2023 and forecasts $2 billion in AI chip sales for the following year. New AI chips, like the Instinct MI300X accelerator and Instinct M1300A accelerated processing unit, were announced in December 2023. 

AMD stock surged over 121% in the past year, trailing Nvidia’s triple growth. AMD, trading at 47.8x forward earnings, lags Nvidia’s 35.4x valuation, likely due to its late AI market entry. Despite Nvidia’s better performance and valuation, AMD’s aggressive AI chip efforts make it a compelling alternative.

Wall Street analysts initially doubted AMD’s move into AI due to market volatility, but recent optimism led to target price increases, with a “strong buy” rating and $191 per share target price. This makes it one of those AI stocks for investors to pay attention to.

Meta Platforms (META)

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Meta Platforms (NASDAQ:META) is another AI stock investors shouldn’t be sleeping on right now. Post-earnings, META stock has soared, as investors were delighted to see the company report better than expected results. Notably, Meta saw an impressive 25% increase in revenue, and its Q1 guidance was auspicious. The company’s fourth-quarter earnings per share came in at $4.33, and sales reached $40.11 billion, which also surpassed predictions. 

CEO Mark Zuckerberg emphasized cost reduction and generative AI investments. Meta’s embrace of AI for digital advertising innovation positions it for future growth. 

Meta continues to prioritize AI for its future growth, increasing 2024 CAPEX to $30-37 billion. Investments focus on AI hardware, software, data centers, NLP, computer vision, and conversational AI. These developments aim to enhance user engagement and advertising revenue.

On February 1, Meta declared its inaugural quarterly dividend and expanded its share buyback program to $50 billion. With a payout of 50 cents per share, Meta joins other tech giants in offering regular dividends. Shares surged over 14% post-announcement, with the dividend set for March payout to shareholders as of February 22. 

With a strong buy rating, META stock could certainly benefit from an AI-driven future. It’s a stock I think investors can only afford to sit on the sidelines at their own risk.

On the date of publication, Chris MacDonald 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 Publishing Guidelines.

Chris MacDonald’s love for investing led him to pursue an MBA in Finance and take on a number of management roles in corporate finance and venture capital over the past 15 years. His experience as a financial analyst in the past, coupled with his fervor for finding undervalued growth opportunities, contribute to his conservative, long-term investing perspective.