- In the realm of artificial intelligence (AI), chip stocks like Nvidia, AMD, and Broadcom have been solid investments. These fabless chip companies design chips but outsource manufacturing, leading to strong margins. With increasing spending on AI hardware, these stocks have shown impressive returns and are expected to continue rising.
- Nvidia leads in AI computing hardware with GPUs for training and running AI models, becoming the world’s largest company by market cap. AMD, offering competitive GPUs and CPUs, aims to close the gap with Nvidia. Broadcom takes a unique approach by designing custom AI accelerator chips for specific workloads, showing rapid growth.
- AMD is expected to deliver 32% revenue growth in 2026 but trades at a higher multiple of expected earnings. Nvidia, projected to have 52% growth in fiscal 2027, is considered a better buy due to being cheaper and growing faster. Broadcom’s ASICs are gaining traction, with potential for higher growth rates surpassing Nvidia.
- Investors are advised to consider having both Broadcom and Nvidia in their portfolios for potential gains in 2026. AMD, while showing promise, needs stronger results to be a consideration. The Motley Fool’s Stock Advisor identified the 10 best stocks to buy, excluding Broadcom, which could yield significant returns in the future.
Read more at Nasdaq: Nvidia vs. AMD vs. Broadcom: What’s the Best AI Chip Stock to Own for 2026