Key Points
Nvidia (NASDAQ: NVDA) has been on a run of historical projections since the artificial intelligence (AI) build-out began in 2023. If you invested $10,000 in Nvidia’s stock at the start of 2023, that sum has now grown to be worth more than $131,170. That’s an excellent return in a short time frame, but it’s unlikely to deliver that level of return over the next few years. So, many investors are searching for other stocks that can deliver similar returns to Nvidia.
I think I’ve identified two AI winners at different stages of hypergrowth, and both look like strong stock picks now.
Micron Technology
Micron Technology (NASDAQ: MU) has actually been a better investment than Nvidia since 2023. That same $10,000 invested is now worth roughly $181,000, although the bulk of that return has come in the past year. Still, I think Micron is just in the middle phase of its expansion.
Micron is thriving from the memory chip shortage caused by the massive AI build-out. AI hyperscalers are creating a massive demand that the memory chip industry just isn’t built to handle, so supply is low, and demand is high. This is driving prices higher, boosting Micron’s revenue and earnings. During its last quarterly earnings report, Micron informed investors that tight market conditions will persist beyond 2027, indicating that there is still more growth on the way.
Furthermore, Micron doesn’t command a very high premium for the stock. It can be purchased for just 12.3 times forward earnings, far less than many other AI-centric stocks.
Data by YCharts.
So, with more growth in store and the stock trading for an attractive valuation, Micron stock looks primed to soar higher over the next few years. While the major returns have already occurred, Micron could easily double or triple from here without becoming overvalued. Nvidia likely will not do that anytime soon, so buying Micron now could be like buying Nvidia in late 2024.
Nebius Group
Nebius Group (NASDAQ: NBIS) is in a far earlier stage than either Micron or Nvidia. It’s a neocloud company, which means it’s focused on AI-first cloud computing. It has a wildly popular platform, and it’s growing rapidly as a result. In Q1 alone, Nebius’ revenue skyrocketed 684% year over year. That’s part of a larger growth trend, as Wall Street analysts project 544% growth in 2026 and 234% in 2027.
Few stocks have the growth upside Nebius offers, making it well positioned to deliver incredible returns over the next few years. However, Nebius is facing one challenge it hasn’t faced in a while: profitability. Nebius is an early-stage company and doesn’t have any other businesses to fund its AI build-out. This means it must seek outside investors to become shareholders or take on debt to fund its expansion. Nvidia is actually one of those, and has invested alongside Nebius to ensure it has the most up-to-date products available first. Nvidia interacts with nearly every AI company on the market, and if it’s choosing to invest in Nebius, that should tell you a lot about its potential.
However, until Nebius reaches profitability, it’s always going to present a major execution risk. Fortunately, several cloud companies are already generating a ton of profits, so there is a pathway. It could be several years before investors see profitability, as Nebius builds out as much computing space as possible while the industry is hot. Investing in Nebius now could be like investing in Nvidia two decades ago, and the upside is immense. However, it could also flop if it cannot get to profitability. I’m still bullish on Nebius, but the risk is far greater than investing in Nvidia itself or Micron.
Should you buy stock in Micron Technology right now?
Before you buy stock in Micron Technology, consider this:
The Motley Fool Stock Advisor analyst team just identified what they believe are the 10 best stocks for investors to buy now… and Micron Technology wasn’t one of them. The 10 stocks that made the cut could produce monster returns in the coming years.
Consider when Netflix made this list on December 17, 2004… if you invested $1,000 at the time of our recommendation, you’d have $410,833!* Or when Nvidia made this list on April 15, 2005… if you invested $1,000 at the time of our recommendation, you’d have $1,208,693!*
Now, it’s worth noting Stock Advisor’s total average return is 917% — a market-crushing outperformance compared to 209% for the S&P 500. Don’t miss the latest top 10 list, available with Stock Advisor, and join an investing community built by individual investors for individual investors.
Keithen Drury has positions in Nebius Group and Nvidia. The Motley Fool has positions in and recommends Micron Technology and Nvidia. The Motley Fool has a disclosure policy.
