Meet the artificial intelligence (AI) stocks I just bought

Key points

• Nvidia shares have been relatively weak in recent months.

• The market is not impressed by Nvidia’s staggering growth figures.

With the market suddenly turning bearish on some of the best artificial intelligence (AI) stocks on the market, I decided now is the perfect time to take action and buy some shares. The company I most recently purchased is quite popular and has been one of the top AI choices for a long time. However, one of the best investment pieces of advice I ever heard came from Peter Lynch, who noted, “Sometimes the best stocks to buy are ones you already own.”

I agree with that philosophy, which is why I recently purchased Nvidia (NASDAQ: NVDA) shares before earnings. While I may be a little disappointed that Nvidia stock didn’t soar after its earnings report, and could have gotten cheaper if I had waited, I’m confident in its long-term prospects and believe it’s still a great buy today.

Will AI create the world’s first trillionaire? Our team just released a report on the one little-known company, called an “Indispensable Monopoly,” that provides the crucial technology that Nvidia and Intel both need. Continue “

Image source: Getty Images.

AI spending isn’t slowing down

The biggest reason why some of the big tech stocks are down next to Nvidia is the market’s growing skepticism about AI spending. The big four hyperscalers alone will spend around $650 billion in capital expenditures this year, the vast majority of which will go towards AI ambitions. There has been a huge amount of innovation in AI in recent months, and it doesn’t look like it’s going to slow down anytime soon. What’s missing, however, are the massive revenue streams needed to justify these expenses, and that’s what the market is concerned about. If there is no real return on investment, why are they spending so much? The reality is that none of these companies can afford to be left behind. If they choose not to invest in AI, and it turns out to be the real deal, it will be nearly impossible to catch up, rendering their business obsolete within a few years. So each of them chooses to continue spending.

Nvidia gets a huge cut on that spending for its graphics processing units (GPUs), so if the hyperscalers were to reduce their AI spending, the company would suffer. But the reality is that no one is slowing down; they speed up. This is evident from Nvidia’s latest quarterly results, where revenue growth actually accelerated compared to the previous two quarters.

NVDA revenue (quarterly annualized growth rate) according to YCharts

Considering that Nvidia generated $68.1 billion in revenue in the fourth quarter of fiscal year 2026 (ending January 25), this growth rate is almost unbelievable. It also gives me confidence that Nvidia is still doing well and that the AI ​​wave shows no signs of slowing down.

While the market may want more muted spending, Nvidia predicts that global capital expenditures on data centers will reach $3 trillion to $4 trillion by 2030. That’s a long way from where we are today, and Nvidia will make shareholders a lot of money along the way if its vision of what the future holds comes to fruition.

It’s also a flashy deal.

Nvidia’s valuation is polarizing

There’s a huge debate going on about Nvidia stock: should you use trailing earnings or forward earnings?

Trailing earnings are much more concrete, because they measure where the company has already been. However, you lose the forward-looking aspect of the market, which is a big problem when a company is growing as fast as Nvidia. On the other hand, there is no guarantee that Nvidia will achieve the analysts’ targets, which set the stage for valuing future earnings. Each of these statistics has its shortcomings; The question is: what do you think is a better representation of Nvidia as an investment?

NVDA PE Ratio data according to YCharts

To me, valuing Nvidia based on future earnings makes the most sense because I believe the AI ​​expansion will be a multi-year opportunity and that Nvidia still has plenty of growth left in the tank. As a result, it looks like a screaming buy at these levels, and investors should consider adding more to their portfolios.

Should You Buy Nvidia Stock Now?

Consider the following before buying shares in Nvidia:

The Motley Fool stock advisor The analyst team has just identified what they think is the 10 best stocks for investors to buy now… and Nvidia wasn’t one of them. The ten stocks that survived the cut could deliver monster returns in the coming years.

Think about when Netflix made this list on December 17, 2004… if you had $1,000 invested at the time of our recommendation, you would have $534,008!* Or when Nvidia created this list on April 15, 2005… if you had $1,000 invested at the time of our recommendation, you would have $1,090,073!*

It’s worth mentioning Stock Advisors total average return is 949% – a market-crushing outperformance compared to 190% for the S&P 500. Don’t miss the latest top 10 list, available at Stock Advisorand join an investment community built by individual investors for individual investors.

View the 10 stocks »

*Stock Advisor returns March 8, 2026.

Keithen Drury has positions at Nvidia. The Motley Fool holds positions in and recommends Nvidia. The Motley Fool has a disclosure policy.