Investors Eye AI-Driven Stocks During Market Volatility
The stock market is currently experiencing fluctuations, largely influenced by ongoing tariff discussions. Amid this uncertainty, now may be an excellent time to acquire strong stocks available at discounted prices. Below, we explore four notable stocks from varied industries that investors can purchase and hold as they position themselves to benefit from advancements in artificial intelligence (AI).
Nvidia (Technology)
Nvidia (NASDAQ: NVDA) has emerged as a key player in AI infrastructure, thanks to its graphics processing units (GPUs). These GPUs are highly effective for handling demanding AI workloads.
Additionally, Nvidia’s CUDA software platform has strengthened its position in the GPU market by simplifying how developers can utilize its chips for various AI applications. The company now commands over 80% market share, with revenue skyrocketing by 380% in the last two years.
With investments in AI data centers continuing to rise, Nvidia is well-poised to capture a significant share of this growth. Major cloud computing firms are expected to spend around $250 billion in AI infrastructure this year alone. Nvidia forecasts that AI data center capital expenditures will reach $1 trillion by 2028, signaling robust long-term potential for its stock.
Image source: Getty Images.
Amazon (Consumer Goods)
As the leader in cloud computing, Amazon’s Web Service (AWS) is taking a front-row seat in AI infrastructure investment, allocating $100 billion for this year. The company is currently developing over 1,000 generative AI applications.
Amazon views AI as a transformative opportunity, continuing to make substantial investments, similar to its successful prior ventures in logistics and AWS. As the largest e-commerce platform globally, Amazon is also utilizing AI to refine customer experiences, optimize delivery routes, and enhance operational efficiencies in warehouses through robotic technology.
The combination of AWS’s capabilities alongside its vast e-commerce operations positions Amazon for sustained success in the future.
Energy Transfer (Energy)
The demand for electricity generated by AI data centers is propelling growth in natural gas consumption. Energy Transfer (NYSE: ET), with the largest integrated midstream system in the U.S., is well-placed for this demand surge.
Based in the Permian Basin, which is renowned for its productive oil drilling, Energy Transfer benefits from its access to cost-effective associated natural gas and an extensive pipeline network.
With a more favorable government stance toward fossil fuels and rising natural gas demand, the company has increased its growth capital expenditures for 2024 from $3 billion to $5 billion. Notably, Energy Transfer has signed an agreement to provide natural gas for a data center project with developer Cloudburst in central Texas.
Given its strong assets and favorable market valuation, Energy Transfer represents a viable investment opportunity, boasting a forward yield of 7.8%.
PayPal (Financials)
PayPal (NASDAQ: PYPL) has navigated challenges in the past, notably grappling with low-margin revenue growth from 2015 to 2023, which reduced its gross margin from 51% to 39.6%.
New CEO Alex Chriss is steering the company towards innovation and high-value services. Efforts to improve transaction margins, alongside the introduction of AI-driven marketing tools like smart receipts, are beginning to bear fruit. PayPal is also enhancing its peer-to-peer platform, Venmo, by introducing a Venmo debit card and the “Pay with Venmo” feature.
The standout innovation, however, is PayPal’s AI solution called Fastlane, designed to streamline the checkout process for consumers. This tool has notably increased conversion rates for merchants and attracted new users to the platform.
Currently, PayPal’s stock trades at less than 12 times forward P/E, indicating potential upside as it enters a new growth phase.
Is Nvidia a Smart Investment Right Now?
Before buying stock in Nvidia, consider this:
The Motley Fool Stock Advisor analyst team has identified 10 stocks they believe are currently superior investment opportunities—and Nvidia is not included in that list. Past recommendations have led to significantly high returns; for instance, an investment in Netflix on December 17, 2004, would have grown to $495,226 by now.
On another note, an early investment in Nvidia on April 15, 2005, would have seen a return of $679,900. The Stock Advisor has delivered an average return of 796%, outpacing the S&P 500 by a considerable margin.
*Stock Advisor returns as of April 10, 2025.
Disclosure: John Mackey, former CEO of Whole Foods Market, an Amazon subsidiary, serves on The Motley Fool’s board of directors. Geoffrey Seiler is invested in Energy Transfer and PayPal. The Motley Fool holds positions in and recommends Amazon, Nvidia, and PayPal and recommends long January 2027 $42.50 calls on PayPal and short June 2025 $77.50 calls on PayPal. Their disclosure policy is available for review.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
