My 10 HIGHEST Conviction AI Stocks

Welcome back to another edition of the Investors Weekly Playbook. Although the markets ended the week on a positive note, they still fell over the course of the week. Nothing to panic about, as I mentioned in last week's edition of the Investors Weekly Playbook video, that I was expected this week to be a slower week, and that's exactly what we saw. In fact, the average volume traded on the S&P 500 over the past 90 days has averaged around 5.4 trillion, and we haven't surpassed that level since August 5th. So, yes, it has been a slow few weeks, but things are about to ramp up with Nvidia set to report earnings next week, which we'll touch on in today's video. And speaking of today's video, here's what we're going to be touching on in the game plan. We'll start with a quick look at market update, look at the report card on retail earnings we got this week, look at a little economic data we got, and then jump into my 10 highest conviction AI stocks to close out this video. So, as always, before we begin, if you could do me a huge favor, smash that like button down below. Subscribe to the channel. It'd be greatly appreciated. And while you're doing that, comment below your highest conviction AI stock right now. Just name one. All right, with that being said, let's jump into our weekly market dashboard. And as you can see, the Nasdaq this week led the markets lower, the downside to the tune of 2.1%. S&P 500 was also in the red, down 1.4% 4% and the Dow Jones also in the red down.85%. Checking in on small caps, they too no different, down 1.7 to close out the week. Here's a look though at sector performance over the past week. And as you can see, the vast majority of sectors, they were in the red. Only three sectors finished in the green. Materials barely in the green, followed then by energy up 2.7% and healthc care, the best performing sector, up nearly 3% this week. But lagards, that was technology and industrials. Now, as we're well aware, we are a consumer-faced economy here in the US. So, outside of government retail reports, which the one we got last week was not very good at all, but that's just one way to view the health of the consumer and their spending. Another is to look at actual financial reports and hear from management about their confidence or lack thereof moving forward, which is usually viewed through guidance. And last week we heard from a number of retailers including the likes of Home Depot, Lowe's, Target, and Walmart among others, which Walmart, that's the behemoth of this group. But let's take a look, a quick look at each of them. Home Depot, well, they beat on both the top and bottom line, but same store sales, those were only growing at 1.7%. And what they did for forward guidance, well, they left that unchanged, which already is looking for little to no growth, meaning management doesn't sound too upbeat on at least on the near-term when it comes to the consumer. Heading over to Lowe's, well, they beat on EPS, but missed on revenues. And Lowe's is more directly correlated with the DIY consumer, whereas HD or Home Depot, they speak more in line with business contractors. They still have many DIY. I go to Home Depot, but most of their sales are more to contractors. Most of low sales are to regular retailers. And looking here at this article from investing.com, you can see that the company actually slashed their forward guidance and it fell below analyst expectations on both EPS guidance and revenue guidance. So, yet another company telling us that, well, consumers are tightening their wallets. Okay. Okay. But maybe it's just a one-off thing, right? We just looked at two companies that happen to be in the housing industry. Maybe just housing projects are slowing, right? Well, let's take a look at Target and Walmart cuz they're going to give us a great insight into the consumer. Let's first begin with Target who has actually seen their stock rise from the depths. This is a company that beat on both the top and bottom line and they raised their guidance for the second consecutive quarter. Sales are now expected to grow by 5%. But when we jump over here to investing pro and look a little deeper, we can see that well earnings a little bit further out. They're actually expected to decline next year. So, it's great that they're growing right now coming off terrible comps from the year prior, but things are coming to a halt. So, overall a better report, but nothing crazy. Now, finally, let's look at Walmart. Walmart beat on both the top and bottom line, but same store sales missed in a big way. Analysts were looking for same store sales of 3.7%. The company reported 2.6%. That is a huge miss and the slowest growth the company has seen in six years. Not a great print whatsoever. On the positive side of things, e-commerce was growing strong and advertising. Both of those strong double-digit growth. And the company is finally rolling out taptoay contactless payment finally. You don't know the number of times that I've walked into a Walmart and forgot my wallet because I use Apple Pay a bunch. It's 2026. How does a company the size of Walmart not already have this? So, I did like that. So, but when I look at the collective approach at all of these reports, I'm going to give the state of retail right now. Just a barely a passing grade, a grade of a C. Just not an area where I want to put my money to work. The growth is minimal. The valuations are high. No thanks. I'm going to pass on those. And when you are researching any particular stock, it's important to look at its close competitors. Just like we did with Home Depot and Lowe's, or if you're comparing the likes of Walmart and Target, look at their financials. Look how management views the near-term based on guidance. And of course, look at valuations. Finding all of this information doesn't have to be difficult, especially when you use a platform like investing.com and investing pro. I have investing pro on my laptop as one of my tabs that just stays up. I visit it on almost a daily basis. Whether I want to stay up to date with the latest market news or just check how the markets are doing in general, it's easy and right there. But when I'm ready to dive deeper, I head over to investing pro where I can type in a stock like in this case Nvidia, see the latest performance, but more important look at the fair value for the stock based on a number of 14 different models to which you can include or exclude as you see fit. And right now it is actually showing upside and fair value even for a $5 trillion company heading into earnings, which tells you a lot. But maybe you are looking for a certain idea, some new ideas. The ProPix AI section is extremely helpful where you can explore different strategies. But the one I like is tech titans which is an AI built portfolio of around 15 to 16 stocks, tech stocks that is. And the model rebalances and updates regularly and you can see the outperformance. It has nearly doubled the S&P 500's return. And when we dive into it deeper, you can see all of the current positions as of this video. And when you use the link down in the pin comment below or the QR code on your screen, you can get up to 55% off with their August sale. But that's not all. When you use that code, you're going to get an additional 15% off with my discount code. Check out Investing Pro and don't miss out because the sale ends in a few days. All right, jumping back to our video in terms of economic data this week. Well, it was pretty quiet. We got some housing data to start the week, but we know that housing has been a disaster. We got weekly jobless claims and then we got the S&P global manufacturing and services PMI. That particular figure right there or both of those figures, those were the key ones I was looking at. Both of them, they came in above 50, which is what we want to see. It indicates an expanding economy in that particular area. And services, that's the key one as it makes up roughly twothirds of the economy. Services PMI came in at 56.8, the highest since December 2024. So that was a good thing. manufacturing came in at 53.2, which still above 50, but it was actually a fivemonth low. So, overall, some decent results. No real red flags to note. So, with that being said, hopefully now you're all caught up on the markets. Now, let's get into what you've been waiting for. My 10 highest conviction AI stocks. And two of the final stocks on this list come with higher risk, but they have massive upside. So, make sure you stay tuned throughout the entirety of this video. But when it comes to AI, I continue to talk about how it's one of the biggest investment opportunities of our generation. But I think many investors are approaching it in the wrong way. They're looking for the one AI stock that's going to outperform everyone else. Personally, I don't think this is the right strategy because AI isn't one company. It's an entire ecosystem. Every time someone asks ChatGBT or goes into Claude and asks a question, searches Google or runs any AI model, there's an entire chain of companies making that possible. Someone manufactures the chips. Someone designs the processors. Someone builds the networking. Someone provides the cloud infrastructure. Someone helps enterprises deploy that AI. And finally, companies monetize AI through applications people use every single day. So today, we're going to build out an entire AI ecosystem together. And as we move throughout the video, you're going to see each layer of the AI stack come to life. And by the end, you'll understand exactly where these 10 companies fit in and why they are 10 of my highest conviction AI stocks right now. And with that being said, here's a look at the AI stack we're going to be filling out today. Every layer depends on the one beneath it. If one layer breaks, the entire system becomes less valuable. And as you can see, the number of different ways a company can contribute and generate returns for shareholders through the world of AI. It's not just one way. And there are even more layers that you could add into this entire AI stack. So with that being said, let's jump right into the beginning with the bottom layer, which is going to be manufacturing. Before Nvidia or AMD can sell a GPU or or AMD particular can ship an accelerator or before Broadcom can build custom silicon, someone has to manufacture those chips. That company is going to be Taiwan Semiconductor, stock ticker TSM. Taiwan Semi has become one of the most important businesses in the global economy. You don't have to pick the winner of who's creating the best chip or the fastest or which company is looking to build their own chips since most of them are manufactured by Taiwan Semi using their cuttingedge fabrication technology. The barriers to entry, they're not very easy. They're enormous. It takes decades of engineering expertise, hundreds of billions of dollars, and relentless innovation. That's why I believe TSM isn't simply another semiconductor company. It's the foundation of the entire AI ecosystem. And jumping over to Investing Pro, we can see the stock is up 85% the past 12 months and currently sports a market cap of nearly $2 trillion, making it one of the largest companies in the S&P 500 today. In the fair value section below the chart, you can see that 18 analysts cover the stock and give it an average 12-month price target of around $555 per share, implying more than 30% upside from current levels. And Taiwan Semiconductor is a name inside my portfolio. In fact, almost all of these stocks are inside my portfolio if you want to see the entirety of the portfolio. Then make sure you join my private investing community, the Stock Investors Edge, where you also get my weekly market report, daily market updates, trade alerts anytime I enter or exit a position, and access to our very own valuation website. Make sure you check out that link down in the description below and get started today. Now, let's jump back to our AI stack and head over to layer number two, which is going to be compute. And here we're going to discuss two of the most popular chip companies on the market today. Nvidia and AMD. Two stocks in my portfolio and two stocks with plenty of growth moving forward. Now that we've built the chips with Taiwan Semi, we need something to actually perform the AI computations. That's where Nvidia and AMD come in. And you can even put this layer below manufacturing as well because they come up with the design and then send it to Taiwan Semi to be manufactured. And beginning first though, let's look at Nvidia which remains the leader of AI compute. We're talking about Blackwell or Ver Rubin, its software ecosystem, developer adoption enterprises EVs robotics. This isn't just a hardware company anymore. It's an entire AI platform, an ecosystem. As enterprises continue adopting AI, I still believe Nvidia remains one of the highest quality businesses in the market today. And this coming week, we get updated results from Jensen Wong, the CEO of All Things AI. Jumping over to Investing Pro, you can see the stock is up 20% the past 12 months and currently sports a market cap over $5 trillion, making it the largest company in the S&P 500 today. In the fair value section below the chart, you can see nearly 60 analysts cover the stock and give it an average 12-month price target of around $35 per share, implying more than 40% upside from current levels. Again, this is a company that's going to be reporting earnings this particular week. All right, now let's move over to AMD. And here's why I own AMD and I like AMD moving forward. The AI market is becoming far too large for just one supplier. Hyperscalers don't want dependence on a single company. AMD continues making tremendous progress with its MI accelerator roadmap while maintaining leadership in CPUs. The opportunity isn't here to replace Nvidia. It's becoming the second major compute platform for AI. And if that happens, AMD still has enormous runway ahead. Plus, they have their very own full stack compute for the Aentic AI era. Again, showing their ability to compete with the likes of Nvidia. Taking a look again here at Investing Pro, we can see the stock is up nearly 200% the past 12 months and currently sports a market cap of 766 billion, far less than that of Nvidia, which speaks to the upside, something I've talked a lot about on this channel. In the fair value section below, we can see the company is covered by 50 analysts nearly, and they give it an average 12-month price target of about $615 per share, giving the stock another 30% upside from current levels. Now, jumping back to our AI stack where we're going to move up a layer to layer number three, which is networking and custom silicon. Once you have thousands of GPUs or CPUs, you face another challenge. How do all of these chips communicate? So, let's start with Broadcom. We're going to have multiple stocks here. Broadcom sits at the center of two incredible trends. First, networking. Second, custom AI chips. Some of the world's largest cloud providers are designing their very own AI accelerators. Whether it's Amazon, Alphabet, OpenAI, or Meta, and there's many more. Broadcom helps make those designs a reality. Instead of betting on one AI model, Broadcom benefits from nearly every hyperscaler increasing their AI investments. And with that being said, we look here at Investing Pro. You can see the stock's up 30%. However, of late, the stock's been under pressure and well off its highs of $495 per share. Broadcom currently sports a market cap of 1.7 trillion. But again, the opportunity is massive for this company. They're not just semiconductors. They have the software component. They have cyber security as well. And in the fair value section there below, you can see that nearly 45 analysts cover the stock with an average 12-month price target of $525 per share, giving the stock more than 40% upside from current levels. Next in this layer is a name I've been preaching about on this channel. And if you've been listening, you've been profiting. And that stock is Marll, stock ticker MRVL. As GPU clusters continue expanding, networking becomes increasingly important. Think of it this way. You can own the fastest GPU in the world, but if the data can't move efficiently, performance suffers dramatically. Marll provides many of the networking and optical connectivity solutions that solve that problem. Networking may not achieve as much attention as GPUs, but it's becoming equally as important. And the company was heavy in the news this week when Alphabet partnered up with them on a new custom AI chip. And as part of that deal, Alphabet or Google has a warrant to purchase up to 58.97 million shares at an exercise price of a little over $26 per share. This is another company involved with connectivity as well as custom silicon. This just goes to show that these companies with the custom silicon design capabilities are in an advantageous position. That includes both Marll and Broadcom, two of my favorites there. The issue right now for many businesses around the globe when it comes to AI, it's lack of supply. Chips can't be built fast enough. So, the custom side of things is not a dent on the likes of AMD and Nvidia, but just another route for businesses. Jumping back over to Investing Pro, we can see the stock's up roughly 230% the past 12 months and currently sports a market cap of $220 billion. And in the fair value section, you can see that 40 analysts cover the stock roughly with an average 12-month price target of about $265 per share, giving the stock only about 12% upside from current levels. Again, this is a stock that's been in the news, and we saw just over 10% upside in just the last week alone. But I don't think that a lot of analysts have updated their models based on the news that broke just on Wednesday. And that target is going higher. And this will be a $300 stock very soon. Now, for one more stock in this layer of the AI stack, and this one I'm really excited about. Remember, I told you at the very beginning that there's a couple of stocks with higher risks attached to their name, but also massive reward. And this is one of those by the way of credo technology, stocktaker CRDO. This is where upside potential becomes especially interesting. The company focuses on active electrical cables and ultra high-speed connectivity. You know, I have loved the copper trade due in part to the demand, the increasing demand for more and more data centers. Well, this is another angle on that play. As AI clusters continue scaling, power efficiency, signal quality become critical. Credo helps solve that challenge. Now, this is a smaller company. it's going to experience much greater volatility than say the likes of a Broadcom or Nvidia. In the last week alone, the stock has fallen under pressure down more than 10% and this had more to do with profit taking and overall weakness in the technology sector more than anything else. Again, this is going to be a volatile name to own. But it's also why I think the upside could be significantly larger if execution continues. Jumping back over to Investing Pro, we can see the stock's up over a 100% the past 12 months and currently sports a market cap of 43 billion, far less than almost every name on this list except for one that we'll cover here a little later. And in the fair value section below, you can see nearly 20 analysts cover the stock with an average 12-month price target of around $285 per share, giving the stock nearly 25% upside from current levels. But I think the upside is even higher, which is why we have been utilizing options to look to buy the stock at an even lower price while generating regular income. So buckle up if you want to own this one. All right, so with that being said, now let's jump back to our AI stack here and we're going to jump up another layer. Now we're going to move into the cloud layer, which is a very important and one of my favorites. As you'll see in a second, two of my largest positions sit in that particular layer. But I've seen huge growth in the latest earnings report from many of these cloud providers. Once the infrastructure exists, businesses need to access it. That's where companies like Amazon come in. For years, Amazon was really known as just an e-commerce company. Now, they're much more than that. Obviously, they're an advertiser. They're a media company. They have the largest cloud provider out there with AWS. And increasingly, AWS is becoming the engine for the company. Amazon continues investing aggressively in AI infrastructure. I should say so much so that their free cash flow even went negative in the most recent quarter and that scared away some investors. But again, I told people to buy this stock at 160. I told them to buy it at 180. I told them to buy it at 200 and 220. And I'm saying it again, Amazon to me is a must-own stock. It's why it's my second largest position inside of my portfolio. And again, you can access my entire portfolio, get trade alerts anytime I make changes when you join my private investing community. There's a link down in the description below. But getting back to Amazon, it has a great leadership team and they've been into the AI revolution for some time now as they were early investors into anthropic. Their money, they've seen huge ROI on that investment. And what we see across the sector is the fact that demand far exceeds capacity when it comes to cloud. Amazon is positioned to benefit regardless of which enterprise ultimately wins the AI race. And there doesn't have to be one winner. and they are even building their own custom AI chips. Taking a look here at Investing Pro, we can see the stock's up nearly 17% the past 12 months and currently sports a market cap of nearly $3 trillion. In the fair value section below, you can see 60 analysts covering the stock with an average 12-month price target of around $330 per share, giving the stock more than 25% upside from current levels. Now again, as a reminder, we're in the cloud layer right now of this AI stack. And there's a probably another name that's on your mind right now that probably belongs in this particular layer. But that particular company, that's the great thing about it is it actually belongs in multiple different layers. And that company is none other than Alphabet, which happens to be my largest position. So we'll save that one for a little later on this list. But getting back to the AI stack, we're going to go up another layer to the enterprise AI level. And if you've been watching my channel for some time now, you know which stock is coming. Many of you have made big profits on this name. And I've seen some of you in public here in Southern California where you mention this particular stock. And that stock is none other than Service Now. Stock ticker NW. Now, businesses need to actually implement AI. And that's exactly where Service Now fits. AI isn't valuable simply because it exists. It creates value when companies use it to automate repetitive work, improve productivity, reduce costs, and increase efficiency. Service Now already has relationships with thousands of enterprise customers. Now, it's layering AI across nearly every workflow. And to me, that's one of the most exciting software opportunities in the market today. And as we have seen in 2026, not all software companies are able to adapt in the world of AI. But with Service Now, they are the AI control tower, and the efficiencies are evident for their customers. In the community, we were buying the stock in the $90 range. Today, the stock is back near 130 with a market cap of $133 billion, as you can see here on Investing Pro. Yet, the stock is still down more than 25% in the past 12 months. Plenty of upside in this name, just to get back to where it was. And in the fair value section below, you can see 46 analysts covering the stock with an average 12-month price target of around $142 per share, giving the stock around 11% upside from current levels. But my target is closer to $155 per share, which is more than 20% upside. All right, time for our final layer. And at least in this AI stack, and hopefully this has helped you visualize what I'm talking about. And if you've enjoyed this video, again, show your appreciation by smashing that like button down below. It helps more than you know. And the final layer is going to be AI applications. This is where consumers actually experience AI. And this is where Alphabet comes into play. Again, we could have had them in a number of different layers. Alphabet may quietly become one of the AI's biggest winners. Whether it's search, Gemini, cloud YouTube Android Whimo Workspace, billions of daily users. Google isn't simply adapting to AI. It's embedding AI across one of the largest ecosystems on Earth today. Many question them early on, but many of those questions are now in the dust. This is one of those hyperscalers spending billions, but they're not spending more than they're actually generating. So, still have positive free cash flow, but we'll have to see what 2027 brings. This is a company, again, my largest position, very diversified, still plenty of upside, and building their own custom chips. Jumping over to Investing Pro, we can see the stock is up an impressive 70% the past 12 months. This is for a company with a market cap over $4 trillion. And in the fair value section below, you can see nearly 55 analysts covering the stock still expecting further upside with an average price target of $430. That's giving us roughly 25% upside from current levels. And again, that's my largest position. And finally, let's talk about my other high-risk, high opportunity stock in Zeta Global. Stock tier Zeta. I love companies using AI to solve real business problems. That's exactly what Zeta does. It's an AI powered marketing platform that helps businesses better understand customers, predict purchasing behavior, and improve advertising effectiveness. After all, if you're a business spending on advertising, what do you want to see? You want to see the best ROI possible. Otherwise, you wouldn't necessarily be spending the money to advertise, and that's where Zeta's systems come in. Now, although it's advertising, it's still much smaller than Alphabet, and that creates a greater risk, but also it has significantly greater upside if management continues executing. Like Service Now, Zeta is another example of a software company that is actually producing results, real results for its clients. And that there is the growth driver. Jumping over to Investing Pro, we can see the stock is up nearly 60% the past 12 months. and currently sports a market cap of $7 billion, easily making it the smallest company in terms of size on our list today. And in the fair value section below, you can see nearly 15 analysts cover the stock, giving it an average 12-month price target of around $31 per share. Being a little bit more patient on this stock might do you some good considering the fact that the stock is up over 35% just in the past month alone. So, with that being said, here's a look at the completed AI stack. Now, take a step back. Notice something. These companies aren't necessarily competing 100% with one another. Everyone has something they bring to the table. That's a little different. They're building different layers of the exact same AI ecosystem. Taiwan Semi manufacturing the chips. Nvidia, AMD, although one has a bigger lead in GPUs, the other a bigger lead in CPUs. They provide the compute. Broadcom, Marll, Credo, they connect everything together in some shape or form, whether it's through custom silicon or connectivity. Amazon delivers AI through the cloud while building its own custom chips among many other businesses and you could include also Alphabet in this exact layer. Service Now, well, they help enterprises deploy AI. And then there's Alphabet, which again I mentioned could be in cloud or could be right here with Zeta who monetize AI through the use of applications used by millions of businesses and consumers. This is exactly how I think about investing. I'm not trying to guess the one AI winner. I'm building exposure across the entire AI economy. And AI, it isn't a fad or a trend. It's becoming foundational, foundational infrastructure for the global economy. We're still in the early to mid innings of this enterprise adoption. Capital spending that continues to increase. Cloud providers continue investing. Businesses continue integrating AI into everyday operations. That's why I continue believing that these 10 companies res represent some of the longest and strongest long-term investment opportunities available in the market today. Now, with that being said, I spoke a lot. I'd like to hear from you. If you can only name one AI stock that you could own over the next decade, is it one on this list or maybe it's a different name? Let me know down in the comments below which it would be. And make sure that you take advantage of the August sale with Investing Pro and use my additional discount code. see the pin comment down below. And if you enjoyed today's weekly investor playbook, don't forget to hit that like button down below, subscribe to the channel, and we'll see you in the [music] next video. Take care.