The bull market that started in October 2022 has been dominated by a single theme: artificial intelligence (AI). Over the past three years AI has dominated the conversation on Wall Street regarding how it holds the potential to transform businesses, create new opportunities, and drive earnings growth for numerous industries.
Indeed, some of the biggest businesses in the world have been driven higher as their earnings explode amid the push for AI dominance. Nvidia is the poster child for AI stocks, climbing an eye-popping 1,330% from October 2022 to today and surpassing a $4 trillion market capitalization.
As many of the most popular AI stocks have soared higher, a lot of them now look fairly pricey these days from a valuation standpoint. An investor just starting out with $300 will want to ensure they're buying a great company at a fair price, and those are getting harder and harder to find in the AI space.
But there are still a few good opportunities out there if you're willing to do the work. Here are three stocks, all with share prices below $300, that can help you get started.
Image source: Getty Images.
1. Salesforce
Salesforce (CRM +2.88%) is best known for its growing suite of enterprise software, which covers everything from its original sales vertical to customer service. The company has been working to integrate AI capabilities with all of its software, but its biggest development over the past year is Agentforce.
Agentforce is built on top of Salesforce's Data Cloud software, which helps aggregate all of the data generated by a business into a single unified source. With Agentforce, customers can create AI agents that can tap into that data to make informed decisions and complete low-level tasks. Salesforce sees enterprises using Agentforce as part of their customer service and sales teams and internally for research or teaching new skills to employees.
Salesforce had 8,000 Agentforce contracts as of the end of the first quarter, generating over $100 million in annual recurring revenue after just two full quarters of sales. CEO Marc Benioff says it's the fastest Salesforce product to reach that milestone.
NYSE: CRM
Key Data Points
The strong early results of Agentforce are encouraging, but it's worth noting that it remains a small part of the overall business for now. Salesforce generated $37.9 billion in revenue during fiscal 2025, which ended Jan. 31, so it'll take some time before the new AI product has a significant direct impact. But the indirect impact could be substantial. It encourages users to take more of Salesforce's products, including Data Cloud, which should increase revenue and retention rates over time.
Salesforce stock trades for about $260 as of this writing. At that price, shares are valued at just 23 times forward earnings estimates. That's a great value for a company that's leading the push toward agentic AI. With management's focus on improving profitability, it should be able to grow earnings per share at a double-digit pace for the foreseeable future, more than justifying its current price.
2. Taiwan Semiconductor Manufacturing
Taiwan Semiconductor Manufacturing (TSM +5.08%), known as TSMC, is the largest contract chip fabricator in the world. Thanks to its scale and leading technology, which commands a premium price, TSMC brings in over two-thirds of all spending on outsourced chip production. And that market share is growing.
There are two important reasons why TSMC continues to take market share: its scale and its technology. As the leading chip manufacturer, TSMC has more money to invest in expanding its production capabilities. When there's a ramp-up in spending on chips like we've seen with AI over the last few years, TSMC is best equipped to handle that demand.
TSMC also takes a significant amount of its sales and reinvests it into research and development, ensuring its technology remains ahead of its closest competitors. That ensures it can continue winning contracts for the most high-end cutting-edge chips well into the future. Nvidia CEO Jensen Huang said TSMC isn't just the best in the world when it comes to its chip technology, it's "the world's best by an incredible margin."
NYSE: TSM
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Management set lofty expectations for its second-quarter results, and it exceeded them based on its preliminary sales reporting. Based on its monthly sales data, TSMC grew revenue 39% last quarter on the back of strong AI-related demand.
Shares of the stock have climbed higher over the last few weeks on that strong monthly sales data and overall strength in chipmakers. Still, at $229 per share, the stock's forward P/E ratio is just 24. That's far lower than most leading AI stocks, especially chipmakers like Nvidia (which trades for more than 38 times forward earnings). Even after the run-up, the stock looks attractive, and it could continue to climb as AI spending doesn't look to be slowing down anytime soon. It's a great option for your $300.
3. Alphabet
Alphabet (GOOG +1.44%) (GOOGL +1.71%) is the company behind Google. Many see AI as a major threat to Google, since more and more people may use OpenAI's ChatGPT or Anthropic's Claude for searches for information. Perplexity has developed product searches and its own AI-first web browser, which could displace Google's Chrome browser. And OpenAI is reportedly following in its footsteps.
The fears accelerated in May when Apple's product chief testified that the company saw fewer Google search queries on its Safari browser in April, the first time it's ever experienced a drop in search traffic. The implication was that AI chatbots were stealing traffic from Google.
But so far Alphabet has managed to see much more benefit from artificial intelligence than any downsides. Google has integrated AI into Google Search with AI Overviews, Google Lens, and Circle to Search. The former has expanded the range of search queries on Google, increasing engagement and user satisfaction, according to management. Importantly, management says searches with AI Overviews monetize at similar rates as those without. Meanwhile, Google Lens and Circle to Search have led to an increase in product-related searches, which are generally more valuable for advertisers. As a result, Google Search revenue climbed 9% in the first quarter.
NASDAQ: GOOG
Key Data Points
The bigger revenue driver from AI, though, is Google Cloud. The company has seen strong demand for cloud computing as developers look to train and develop their own software powered by large language models. That led to a 28% increase in revenue in the first quarter. More importantly, Google Cloud's operating margin expanded from 9.4% to 17.8% last quarter as it scales. And based on its bigger competitors, there could be a lot of margin expansion for Google Cloud in the years ahead. As such, it should provide strong support for bottom-line growth at Google in combination with the slow and steady growth of Google Search.
On top of that, Alphabet also has several other irons in the fire. The biggest of those other businesses is likely Waymo, which has grown quickly over the past few years with its self-driving car service. The company now says it completes 250,000 rides per week, and it's expanding to several more cities in 2025. The potential for Waymo once it scales and brings down the cost of production for its vehicles is significant, but in the near term Alphabet is willing to sink money into it to maintain its first-mover advantage.
At a current price of $181, shares of Alphabet trade for a forward P/E of just 19. That's far and away the least expensive of the "Magnificent Seven" stocks and an absolute bargain considering the growth potential of Google Cloud and the cash flow generated by Google Search. Investors with just $300 could see solid long-term returns from a stock that has remained resilient for years.
