Artificial intelligence (AI) is driving the most significant technological shift in the economy since the internet. PwC estimates AI could add $15 trillion to the global economy by 2030.
The following companies are meeting growing demand for AI in national defense, data center infrastructure, and digital advertising. Here's why these stocks should be rewarding investments for the next several years.
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1. BigBear.ai
Governments are budgeting for increased AI spending to address mission-critical national security needs and other operations. BigBear.ai (BBAI 4.30%) is a leader in providing generative AI tools for national security and defense. It's positioning itself to capitalize on this surging demand with its recent acquisition of AskSage.
AskSage could be a game changer in accelerating the company's growth. It offers a platform that combines AI models and AI agents to perform tasks autonomously and is purposefully built for handling sensitive data. This acquisition provides BigBear with an all-in-one solution encompassing software, data, and services, which management expects will give it a competitive edge in securing more government contracts.
NYSE: BBAI
Key Data Points
AskSage has been a fast-growing business. Its annual recurring revenue is expected to be six times higher this year than in 2024. The increased funding for defense in the "big beautiful bill," which allocates $70 billion for customs and border protection and $673 million for biometric identification solutions, is a significant catalyst for BigBear.ai.
For investors to make significant money off the stock, BigBear.ai will have to execute and show stronger revenue growth. Its quarterly revenue has decreased by 18% over the last three years.
However, the additional revenue opportunities from AskSage could provide fuel for the stock to take off over the next year. The stock has a market capitalization of just $2.6 billion at the time of writing, providing material upside potential if the company is able to secure more government contracts.
2. Dell Technologies
The growing adoption of AI is creating tremendous demand for more data center capacity. Dell Technologies' (DELL +2.92%) leading market share in the server market positions it well to benefit from investment in AI infrastructure.
When a new data center is built, there's a good chance Dell is the company designing and installing the servers in those massive facilities. Each server is equipped with high-performance interconnect cables, advanced cooling systems, and sophisticated chips.
All these components must be set up correctly to achieve maximum computing power and efficiency for AI workloads, which require working closely with customers to understand their specific needs. Dell's ability to deliver servers to data centers quickly, along with providing value-added services such as consulting and installation, gives it a competitive edge.
NYSE: DELL
Key Data Points
The company's revenue grew 11% year over year in the last quarter, primarily driven by demand for AI servers. It has shipped more than $15 billion of AI servers this year through the third quarter and ended the recent quarter with a record backlog of $18.4 billion.
The robust growth in the infrastructure solutions business is currently carrying the weight, as the other half of Dell's business (PCs and peripherals) is growing more slowly. However, as Dell's server business continues to grow and achieve higher margins, the stock could deliver outstanding returns. Dell's adjusted (non-GAAP) earnings per share rose 17% year over year in the third quarter, yet the stock trades at a modest forward price-to-earnings multiple of 11 on 2026 estimates.
3. Meta Platforms
Meta Platforms' (META +0.97%) family of apps, including Instagram, is benefiting from more intelligent AI that puts more relevant content in users' feeds and helps advertisers improve their returns on investment. Its revenue grew 26% year over year in the recent quarter. The company is increasing its investment in AI infrastructure to build even smarter AI and drive long-term growth across the business.
NASDAQ: META
Key Data Points
Meta has an enormously strong competitive position to monetize AI across 3.5 billion people who use its family of apps every day. This massive user base is an advantage in terms of the amount of data the company has on which to train its AI models.
Meta claims its Superintelligence Labs has the highest talent density of any company in the industry. It spent $52 billion in research and development over the last year, which includes employee compensation and investment in new products.
Meta plans to spend at least $70 billion this year to support its AI infrastructure and technology needs, which should lead to even better AI over time and better user experiences. Its ability to fund these investments out of its cash from operations, which totaled $107 billion on a trailing-12-month basis, is why Meta stock is a solid investment.
With the stock trading at just 21 times next year's consensus earnings estimate, investors are getting a steal on this dominant tech company. This valuation could set the stage for market-beating returns in the years to come.
