The rise of artificial intelligence (AI) technology provides the promise of building wealth to investors who hold the right stock. Estimates suggest that the productivity boost driven by AI can add trillions of dollars to the global economy over the long term.
After much running over the past few years, market-leading AI stocks have been pulled back slightly this year. Investors focusing on long-term market trends may acquire this revision as an opportunity to set themselves up for future profits. Here are two stocks trading from highs that are currently worth buying.
1. Soundhound AI
Sound Hound AI (soun 1.99%)) He is a leader in voice assistant technology and experiences robust revenue growth. However, it has dropped 49% so far after a surge in stocks in 2024. Many of those slides came after AI chip leader Nvidia revealed that she had sold stakes in the small company. However, a closer look at the situation shows that the sale is an overreaction that sets a great purchase opportunity.
Soundhound and Nvidia are collaborating on AI solutions for vehicles. Their partnership was featured at CES earlier this year, with Soundhound coming out at NVIDIA’s upcoming GTC 2025 and is expected to demonstrate a demonstration of voice assistant technology using generated AI on the NVIDIA Drive AGX system.
Soundhound’s top line almost doubled in 2024. This partially reflects additional revenue from the Amelia acquisition. With this acquisition, Soundhound will help expand its addressable markets to retail, banking and healthcare sectors, beyond vehicles and restaurants. In Q4, Soundhound also expanded to Energy after trading with one of the largest U.S. power companies.
The future looks bright. During the fourth quarter revenue call, the company has shown that it has a strong pipeline of new opportunities, and continues to focus on adding new features to its products to enhance customer value. The company raised its revenue guidance for 2025 from $157 million to $177 million. This increases by 96% at the midpoint.
Trading at a price-to-sell ratio of 45, the stock looks expensive, but the company should be able to grow into a valuation. Soundhound is an intermediary cap company with great potential. The market capitalization is currently at $4 billion, but it could be significantly worth it over a decade.
2. DellTechnologies
Tech companies are spending billions of dollars expanding their computing infrastructure to handle AI workloads. Statista estimates that the global AI server market will increase from $31 billion in 2023 to $43 billion by 2033. (Del) -1.68%)) It’s good for profit. Dell generates a large portion of revenue from selling PCs and related accessories, but 46% comes from the Infrastructure Solutions Group, which includes servers.
The stock price has fallen 46% from its all-time high peak in 2024, falling 17% so far as tariff concerns and potentially creating recent uncertainty about the company’s outlook, as it could be imposed by tariff concerns and trade disputes in Dell’s supply chain. Dell believes that there is a resilient supply chain and can navigate these obstacles, but its long-term opportunities far outweigh the short-term impact that tariffs can have on costs.
Dell recently signed a deal with Xai, creator of the Grok Large Languages model, expanding its AI server backlog to $9 billion. The company’s infrastructure solutions business increased revenue by 29% to $43.6 billion in 2024, offsetting a decline in PCS sales. Dell expects revenue per share and adjusted earnings to increase by 8% and 14% in 2025, driven by server demand.
Dell also continues to increase sales of traditional servers and storage solutions. Its PowerStore products have experienced strong demand for the past four consecutive quarters. This shows how the company offers differentiated services, not just selling servers, adding value to its customers, and solidifying its leadership in the market.
Dell predicts that the addressable market for AI hardware and services will increase to $29.5 billion by 2027 at a rate of 33% per year over the next few years. That PC business should experience improving demand over the next few years as businesses and consumers upgrade to AI-enabled PCs. The end of Microsoft’s support for Windows 10 is also a catalyst for strengthening PC sales.
Importantly, Dell stock is inexpensive and trades at 10 times its 2025 earnings estimate, with the current stock price, which has a forward yield on its dividends of 2.2%. This rating reflects Dell’s low expectations for its PC business, but the strong demand for Dell’s infrastructure solutions drives double-digit percentage revenue growth.
John Ballard holds a job at Nvidia. Motley Fool has jobs at Microsoft and Nvidia and recommends. Motley Fool recommends the following options: A $395 phone at Microsoft for January 2026 length and a $405 phone to Microsoft for January 2026 short term. Motley Fools have a disclosure policy.
