These two AI stocks could become core.
For most people, $50,000 is a significant amount of money. In fact, you can buy a pretty nice car for that amount of money. However, in the long run, your best bet is to invest it rather than spend it.
And when it comes to investing, one of the first stocks that long-term investors should focus on is technology stocks. As technologies such as artificial intelligence (AI) continue to transform the world we live in, technology companies are becoming the biggest winners in the stock market.
Let’s take a look at two top tech stocks that investors can buy today that are riding the AI wave. One person is the leader on the hardware side and the other person is the leader on the software side. Investing $50,000 in these names is good, but of course you can start with any amount.
Nvidia
No company has won bigger in AI than Nvidia (NVDA 0.78%)and nothing seems to stop its momentum. The company’s graphics processing units (GPUs) are the backbone of building AI infrastructure, and the company recently said demand for its latest Blackwell chips has been “insane.”
Nvidia has been able to capture more than 80% market share in the GPU space due to the strong performance of its chips, but more importantly, its CUDA software platform. Long before AI became the next big thing, CUDA became the standard platform for developers to learn to program GPUs. This created a wide moat around the burgeoning GPU business.
Meanwhile, the demand for AI infrastructure continues unabated, as major technology companies pour money into the space to develop more sophisticated AI models. As AI models advance, training requires more computing power, which is provided by Nvidia’s GPUs. For example, Alphabet says its new Llama 4 Large Language Model (LLM) requires 10 times more computing power than its predecessor, while xAI’s Grok 3 LLM uses five times more GPUs than Grok 2. All infrastructure companies have indicated that spending will continue to increase, with Oracle saying there will be no end to AI infrastructure spending over the next five to 10 years. This all benefits Nvidia.
Despite the company’s strong performance, the stock remains attractively priced, with a forward price-earnings ratio (P/E) of less than 35x and a price-to-earnings ratio (PEG) of approximately 35x, based on next year’s analyst forecasts. It has doubled. 0.9. Generally, a PEG of less than 1 is considered undervalued, and growth stocks often have a PEG well above 1.
Image source: Getty Images.
microsoft
Another company riding the AI wave is Microsoft (MSFT 0.35%)The company was one of the first major technology companies to fully commit to this technology when it invested heavily in and partnered with OpenAI.
So far, the company’s Azure cloud computing division has been the company’s biggest beneficiary of AI, as companies turn to its platform to create their own AI solutions. It’s a pay-as-you-go business where users only pay for the resources they use, and so far, utilization has been very strong. This is reflected in the company’s performance, with Azure seeing revenue growth of about 29% to 30% over the past few quarters.
Cloud computing isn’t the only area the company is turning to AI to drive growth. The company’s GitHub Developer platform was also a big AI winner, with customers turning to Copilot, an AI assistant that can make suggestions and complete coding tasks as developers type.
But the next big opportunity for the company could be with Microsoft 365 Copilot. The company recently introduced a number of improved Copilots for Microsoft 365. This is used to direct your organization to the Microsoft 365 Copilot add-on. These new features allow users to work with the programming language Python in Excel using only natural language, retrieve data from different types of sources using Word Copilot, and use Copilot for PowerPoint. You can use it to create presentations using only natural language.
The Microsoft 365 Copilot add-on costs $30 per user per month, but 365 Copilot is more expensive than many Microsoft 365 subscriptions, so this represents a huge potential growth opportunity for Microsoft. To purchase Microsoft Copilot, users need a separate license to a qualifying plan. Pricing starts at $4.75 per user per month for the Basic Business plan without Teams, cybersecurity and identity management features. Some enterprise plans with more features may cost more.
Microsoft has proven to be an adaptable and innovative company, which has helped it grow into one of the world’s largest companies. These characteristics, and the AI opportunity at hand, make it a great long-term investment.
Alphabet executive Suzanne Frye is a member of The Motley Fool’s board of directors. Geoffrey Seiler is with Alphabet. The Motley Fool has positions in and recommends Alphabet, Microsoft, Nvidia, and Oracle. The Motley Fool recommends the following options: A long January 2026 $395 call on Microsoft and a short January 2026 $405 call on Microsoft. The Motley Fool has a disclosure policy.
