One of the biggest themes in the stock market in 2024 was artificial intelligence (AI), which is showing signs of becoming a breakthrough technology. That said, AI seems to be still in its infancy, and 2025 still promises many opportunities in this field.
Let’s take a look at three AI stocks to buy this month.
1. Nvidia
Nvidia (NVDA -3.00%) There is no doubt that it is the biggest winner from AI, as its revenue has definitely skyrocketed over the past two years. Revenue rose 125% in the 2024 fiscal year that ended last January, and revenue is on track to more than double again in fiscal 2025.
The company’s graphics processing units (GPUs) are the backbone of building AI infrastructure due to their superior processing speed needed to handle large-scale language model (LLM) training and AI inference. Meanwhile, the company has gained an impressive 90% market share in the GPU space over rival Advanced Micro Devices thanks to its superior software platform CUDA. CUDA includes developer tools and micro-libraries that allow you to easily program chips to handle a variety of AI-related tasks. .
As LLM training requires more and more computing power, spending on AI infrastructure will only accelerate. Meanwhile, NVIDIA’s largest customer, Microsoft (MSFT -1.32%) The company announced it will spend about $80 billion on AI data centers this calendar year.
Typically, about half of your spending goes to servers with GPUs. By comparison, Microsoft spent $44.5 billion on capital expenditures (Capex) in its last fiscal year, which ended in June. Other large customers have also increased capital spending on AI infrastructure this year, and Nvidia still has significant growth ahead of it.
Despite its strong stock price performance, NVIDIA trades at a forward price-to-earnings (P/E) ratio of approximately 31.5x and a price-to-earnings ratio (PEG) of 0.98 based on 2025 analyst estimates. Generally, a PEG of less than 1 is considered undervalued, and growth stocks often trade at a PEG well above 1.
Image source: Getty Images.
2.Microsoft
Microsoft plans to invest heavily in AI infrastructure this year, and for good reason. The company’s cloud computing division, Azure, has been a big winner in AI, with revenue growth of 33% last quarter and usage of Azure OpenAI doubling in the past six months. Azure is a consumption model, and customers use its services to build their own AI agents and applications. This has led to increased usage of data and analytics services.
Azure is showing strong growth, but it could be even stronger without capacity constraints. The company already expects Azure revenue to start accelerating in the second half of the fiscal year as capacity increases from past capital expenditures. Meanwhile, companies are spending millions of dollars building data centers around the world to meet demand.
In addition to cloud computing, the company also has big opportunities on the AI software side with its AI assistant Copilot in the Microsoft 365 suite of productivity tools. For $30 per month per enterprise usage, Microsoft lets you organize and prioritize emails, create PowerPoint presentations using only natural language, use the Python programming language in Excel using only natural language, and more. We offer AI copilots for a variety of productivity tools that you can run. Display a prompt. These AI co-pilots will save your employees a lot of time and will be a huge growth driver for your company in the future.
The stock is trading at a forward P/E ratio of 32.5 times this fiscal year, making the stock reasonably valued.
3. Salesforce
sales force (CRM -2.77%) is poised to become the leader in agent AI, which is considered the next evolution of AI beyond generative AI. Generative AI allows users to create content through prompts, such as asking ChatGPT to create a vacation itinerary. Agentic AI takes it to the next level by going out on its own and booking everything you need for that vacation, including flights, hotels, dinner reservations, tour guides, and more.
The long-time leader in customer relationship management (CRM) software released its agent AI platform, Agentforce, in October, with an improved version announced in mid-December. The platform offers a variety of ready-to-use agents that users can customize through no-code and low-code tools, but customers can also build their own agents from scratch. Out-of-the-box agents are available for sales, marketing, recruiting, customer service, and more.
Salesforce has been rapidly adopting Agentforce early on, with the company announcing in early December that it had closed 200 teams and more than 1,000 teams in mid-December. The company predicts that 1 billion Agentforce AI agents will be deployed by the end of fiscal year 2026 (ending in January 2026). This is a huge opportunity for the company since Agentforce is a consumable product that costs $2 per conversation.
The company’s stock currently trades at a reasonable valuation of 29x fiscal 2026 P/E and a PEG of 0.8x.
Jeffrey Seiler has no position in any stocks mentioned. The Motley Fool has positions in and recommends Advanced Micro Devices, Microsoft, Nvidia, and Salesforce. 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.
