Top AI Stocks to Consider Amid Market Volatility

Artificial intelligence (AI) stocks have experienced significant fluctuations recently, as prices for leading companies in the field have retraced over the past month. This market volatility has, however, created potential buying opportunities for long-term investors who can identify undervalued stocks. Here, we evaluate three AI stocks worth considering this month.

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1. Nvidia

Nvidia (NASDAQ: NVDA) just posted impressive revenue growth; however, it remains vulnerable to the current market sell-off. As of now, the stock has declined nearly 25% from its peak in January. Nonetheless, Nvidia continues to be strategically poised to capitalize on the growing demand for AI infrastructure, a sector seeing increasing expenditures this year.

Cloud computing leaders are making substantial investments, with Amazon (NASDAQ: AMZN) planning to spend roughly $100 billion this year to develop its AI data centers. This is closely followed by Microsoft‘s $80 billion and Alphabet‘s $75 billion investments. Meta Platforms is also planning up to $65 billion in capex aimed mainly at AI infrastructure. Additionally, a consortium led by OpenAI and SoftBank is set to invest $500 billion over the coming years through Project Stargate, emphasizing the scale of AI spending by major players.

Nvidia holds a dominating 90% share of the GPU market, essential for training AI models and inference tasks, buoyed by its CUDA software which facilitates programming these chips for diverse tasks. Over the years, Nvidia has expanded its offerings with extensive AI libraries and microservices, proving its position in the evolving AI landscape. Although some competitors create custom AI chips, they frequently integrate Nvidia’s flexible GPUs for their broader capabilities.

The stock’s recent decline has rendered it appealing, currently priced at a forward price-to-earnings ratio of 25.5 based on 2025 analyst estimates and an impressive price/earnings-to-growth (PEG) ratio below 0.5, highlighting its undervalued status.

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2. Amazon

Although Amazon is famously recognized for its e-commerce services, it stands as a tech powerhouse. Its most significant profit driver is the cloud computing division, Amazon Web Services (AWS), which pioneered the infrastructure-as-a-service model and dominates the market.

AWS continues to be the firm’s fastest-growing segment, with revenue increasing 19% to $28.8 billion last quarter and operating income growing 47% to $10.6 billion.

AWS’s success is supported by the company’s development of custom AI chips, known as ASICs (application-specific integrated circuits), which are optimized for specific tasks and generally excel in performance while consuming less power, though they lack the versatility of GPUs.

Amazon has reported substantial contributions in the design of these chips while also licensing some technology from Marvell. Customers leverage AWS to construct their AI models and applications with foundational models to utilize as starting points. Its SageMaker platform enables customers to tailor and deploy AI models effectively.

This year, AWS will invest $100 billion into AI data centers to accommodate its capacity constraints, reinforcing its commitment to leading the AI race. Presently, Amazon shares are 15% lower than recent highs and trade with a forward P/E of 32, making it a suitable option.

3. Salesforce

On the software front, Salesforce (NYSE: CRM) presents a robust investment with its stock down 20% from its recent peaks. The company is striving to lead the market in agentic AI—AI agents capable of executing tasks with minimal human oversight.

Salesforce’s new agentic AI platform, Agentforce, launched in October 2024, has garnered positive feedback, boasting 5,000 deals, including 3,000 active contracts. Agentforce provides clients with various AI agents and offers tools to design custom agents without extensive coding.

Recently, Salesforce debuted the Agentforce marketplace, AgentExchange, signing over 200 partners that provide a variety of ready-to-use solutions and templates. Notable companies like Workday, Docusign, and Box are among those collaborating in this initiative.

Agentforce is priced at $2 per interaction, presenting significant growth opportunities as more agents are adopted. By enhancing productivity and enabling cost savings for clients, Salesforce could experience notable expansion in the upcoming years.

The stock is attractively valued at 26 times 2025 analyst earnings estimates and a PEG ratio of 0.35.

Should you invest $1,000 in Nvidia right now?

Before deciding to invest in Nvidia, it’s essential to consider this:

The Motley Fool Stock Advisor analyst team has recently identified the 10 best stocks that investors should consider now, and Nvidia was not included in this list. The selected stocks have potential for significant returns.