Markets can be volatile, but these technology leaders are likely to see it through.
With so much market volatility lately, it’s no surprise that many investors are reconsidering which stocks to invest in and which ones will stand the test of time.
While there are certainly no guarantees, three companies that are in prime position to benefit from their technology leadership positions are Nvidia, Alphab.etc.Taiwan Semiconductor. Here’s why each is worth buying now and holding in your portfolio for years to come.
1. Nvidia isn’t going anywhere
Many are trying to determine whether we are now in an artificial intelligence bubble and whether acquiring Nvidia, a leading designer of artificial intelligence (AI) processors, is still a smart idea.
There’s nothing wrong with not jumping on trends at the end of a cycle, but it may be a mistake to ignore Nvidia stock due to such concerns. That’s because technology companies continue to increase spending on AI data center infrastructure, which will prompt more purchases of Nvidia’s processors.
Consider that Alphabet recently announced it would double its capital spending this year to up to $185 billion, and Meta also said its capital spending would jump to up to $135 billion, nearly doubling. Just days after these announcements, Amazon announced that it would increase its spending this year by up to $200 billion. All of these companies cite the need to build out more data center infrastructure and AI computing power.
If all of this isn’t convincing enough to buy Nvidia stock, consider that its current price-to-earnings ratio is around 47, which is only slightly higher than the average P/E in the Tech industry of around 43.
2. Lots of alphabets left in the tank
Alphabet’s first clear success with AI was its Gemini chatbot, which currently has 750 million monthly active users, a 67% increase from just nine months ago. And the company recently signed a new partnership with Apple that will make Gemini the artificial intelligence model underlying the next version of Siri.
According to the company, this collaboration could be worth billions of dollars to Alphabet over the next few years. financial timesstructured as a cloud computing transaction. These sales will add to Alphabet’s already impressive Google Cloud sales, which rose 48% to $17.7 billion in the fourth quarter.
And, as mentioned earlier, Alphabet is doubling its capital spending this year, which should help the company maintain its presence in the rapidly changing AI market. Additionally, Alphabet stock trades at a P/E ratio of just 30 times, making the stock relatively affordable for investors right now.
3. Taiwan Semiconductor will benefit no matter who wins in the AI field
Taiwan Semiconductor Circuit (TSMC) is one of the world’s leading semiconductor manufacturing companies with a 70% market share. The company makes some of the industry’s most advanced chips, has higher yields than Samsung and Intel, and is often a strong choice for tech giants in need of AI processors.
If you really want a company with a long-term competitive advantage, consider that TSMC’s organic growth from major technology trends could last for decades, according to Morningstar research.
TSMC is already benefiting from the surge in need for AI processors, with 2025 sales expected to rise 30% to $122.4 billion and diluted earnings to rise 47% to $10.65 per American Depositary Receipt. TSMC’s management is confident in the company’s path forward and has set a goal of increasing sales by 30% this year. And like the other two AI stocks on this list, TSMC’s stock price is high, with a P/E ratio of just 34.
Chris Neiger has a position at Apple. The Motley Fool has positions in and recommends Alphabet, Amazon, Apple, Intel, Meta Platforms, Nvidia, and Taiwan Semiconductor Manufacturing. The Motley Fool has a disclosure policy.
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