The artificial intelligence (AI) buildout is a time for investors to potentially create generational wealth. Trillions of dollars will be spent on AI computing over the next few years, and ensuring that your portfolio is properly positioned to take advantage of this massive spending could create generational wealth for you.
The key is to buy the right stocks. I've got four that I think can help accomplish this worthy goal.
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Nvidia and Broadcom
Unless you've been stuck in a cave, it's hard not to have heard about Nvidia (NVDA 1.53%) over the past three years. Its graphics processing units (GPUs) have become the primary computing unit for powering AI workloads. As a result, Nvidia has become the largest company in the world. Broadcom (AVGO 1.63%) is lesser known but starting to become popular. The company does a lot of things, but its primary product in the AI space is its custom AI chips.
While Nvidia's GPUs are great for a wide variety of workloads, Broadcom is specifically designing chips for known workloads. Neither one of these solutions will become the sole winner, so owning a combination of these two makes perfect sense.
NASDAQ: AVGO
Key Data Points
Investors may look at the stock charts of these two companies and believe they've missed the boat, but that's far from the truth. There's a ton of growth left in AI, and Nvidia believes that global data center capital expenditures will reach $3 trillion to $4 trillion annually by 2030. That's plenty of spending to go around, making these two stocks fantastic buys right now.
Taiwan Semiconductor
Both Nvidia and Broadcom are on the design side of AI computing hardware and don't actually manufacture the chips. The work is primarily outsourced to Taiwan Semiconductor Manufacturing (TSM 4.96%), the leading logic chip fabricator.
Taiwan Semiconductor is continuously pioneering new technologies and launching its 2-nanometer chip node, as a result. This is just one technology in the pipeline, but it helps solve a key problem -- energy consumption.
NYSE: TSM
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TSMC's management claims that 2nm chips consume 25% to 30% less power when configured to run at the same speed as previous 3nm-generation chips. Taiwan Semiconductor also has more technologies in the development pipeline that offer similar gains. This continuous innovation is what makes TSMC the primary partner in producing chips.
Taiwan Semiconductor will be a beneficiary of increased AI spending, regardless of which computing units are being used. This makes it a great way to stay neutral in the AI revolution, as a rising tide will lift all boats.
Nebius
The previous three companies were all trillion-dollar companies. Nebius is much smaller, with a $21 billion market cap. However, this small size may be the key to its delivering more gains over the next few years.
Nebius (NBIS 3.53%) provides full-stack computing solutions, so clients can rent out its computing capacity and have access to everything they need to train and run AI models. This is similar to the already successful cloud computing business model already deployed by many tech giants.
NASDAQ: NBIS
Key Data Points
However, because Nebius is AI-focused, it's seeing huge interest. In Q3, its annual run rate was $551 million. By the end of 2026, that figure is expected to be $7 billion to $9 billion.
If Nebius can deliver on that growth projection, I have little doubt that the stock will be much higher throughout this year. If it can continue delivering similar levels of growth over the next few years, I think Nebius could be one of the top-performing stocks in the whole market.
However, it's far more risky than the previous three as its buildout could face delays, causing clients to go elsewhere. But if it goes right, it will be an incredible stock pick.
