Artificial intelligence, automation and robotics are disrupting virtually every industry. In recent years, the world has gotten a firsthand look at remarkable advances in AI technology, including OpenAI’s ChatGPT AI chatbot, GitHub’s Copilot AI code generation software and Google’s Gemini AI model.
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Whether it be machine learning, large language models, smart applications and appliances, digital assistants, synthetic media software, or autonomous vehicles, companies that aren’t investing in AI products and services risk falling behind. Countless companies stand to benefit from AI, but a handful of stocks have AI and automation as a central part of their businesses. Here are 10 of the best AI stocks to buy, according to Argus:
| Stock | Upside Potential* |
| Microsoft Corp. (ticker: MSFT) | 24.2% |
| Nvidia Corp. (NVDA) | 21.1% |
| Alphabet Inc. (GOOGL) | 4.2% |
| Amazon.com Inc. (AMZN) | 2.6% |
| Meta Platforms Inc. (META) | 9.1% |
| Taiwan Semiconductor Manufacturing Co. Ltd. (TSM) | 15.0% |
| ASML Holding NV (ASML) | 74.9% |
| Adobe Inc. (ADBE) | 39.3% |
| International Business Machines Corp. (IBM) | 16.8% |
| Arista Networks Inc. (ANET) | 3.1% |
*As of Jan. 3 closing price.
Microsoft Corp. (MSFT)
Microsoft has invested at least $13 billion in OpenAI and has integrated ChatGPT into its Bing search engine. The company has also integrated all its AI copilots into a single AI experience called Microsoft Copilot. Microsoft is reportedly working on teaching a new set of autonomous AI agents that can act on behalf of users by taking actions such as approving customer returns and reviewing shipping invoices 24 hours a day without human prompts. Analyst Joseph Bonner says Microsoft is investing in both external AI startups and internal AI technology development. Argus has a “buy” rating and $526 price target for MSFT stock, which closed at $423.35 on Jan. 3.
Nvidia Corp. (NVDA)
High-end chipmaker Nvidia provides the massive processing power needed to run advanced AI applications. Nvidia has been one of the best-performing stocks in the entire market in recent years, and it’s largely due to the company’s AI exposure. In November, Nvidia demonstrated new AI technology aimed at the music, video game and movie industries that can modify voices and produce novel sounds. Analyst Jim Kelleher says Nvidia’s long-term growth opportunities extend beyond AI into massive end markets such as professional visualization, gaming and advanced automotive applications. Argus has a “buy” rating and $175 price target for NVDA stock, which closed at $144.47 on Jan. 3.
Alphabet Inc. (GOOGL)
Google and YouTube parent company Alphabet uses AI and automation in virtually every facet of its business, from ad pricing to content promotion to Gmail spam filters. Google launched its Bard AI chatbot in March 2023 and its Gemini general AI model in December 2023. In December 2024, Google reported a major breakthrough in its Google Quantum AI Willow chip, a 105-qubit chip that could have major AI technology applications. Bonner says Alphabet is a clear AI leader as it continues to integrate Gemini throughout its product stacks. Argus has a “buy” rating and $200 price target for GOOGL stock, which closed at $191.79 on Jan. 3.
Amazon.com Inc. (AMZN)
Amazon has integrated AI into every aspect of its business, including its targeted advertisements, its marketplace search and recommendation algorithms, and Amazon Web Services. Amazon offers a wide range of AI and machine learning services to its AWS cloud customers, including advanced text analytics, automated code reviews and chatbots. In December, Amazon announced a new family of multimodal generative AI models called Nova that can generate images, text and videos. Kelleher says generative AI investments have boosted AWS growth to the high-teens percentage range. Argus has a “buy” rating and $230 price target for AMZN stock, which closed at $224.19 on Jan. 3.
Meta Platforms Inc. (META)
Meta Platforms is a market leader in social media and online advertising and is the parent company of Facebook, Instagram and other platforms. CEO Mark Zuckerberg has adopted a bold strategy of making Meta’s AI technology free and open to the public in an effort to gain market share and drive down competitors’ prices. In December, Meta released Motivo, an AI model that can control a digital avatar and potentially improve the Metaverse experience. Bonner says Zuckerberg has repeatedly built large user bases and then successfully monetized them. Argus has a “buy” rating and $660 price target for META stock, which closed at $604.63 on Jan. 3.
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Taiwan Semiconductor Manufacturing Co. Ltd. (TSM)
Taiwan Semiconductor Manufacturing is the world’s largest pure-play semiconductor foundry. Taiwan Semi manufactures all the advanced AI chips for Nvidia and other AI chipmakers. Taiwan Semi CEO Hsu Ming-chi recently told Bloomberg the “booming of the AI industry has just begun.” Kelleher says new restrictions on semiconductor exports could be a potential headwind for Taiwan Semi, but mainstream adoption of generative AI, receding inflation and a rebound in electronic device demand will support demand. He says Taiwan Semi is the world’s leading pure-play chip foundry and is attractively valued. Argus has a “buy” rating and $240 price target for TSM stock, which closed at $208.61 on Jan. 3.
ASML Holding NV (ASML)
ASML produces photolithography systems and other processing equipment used in semiconductor fabrication. ASML is the only major producer of the extreme ultraviolet (EUV) lithography equipment necessary to produce advanced AI chips. Taiwan Semiconductor and Samsung Electronics Co. Ltd. (005930.KS) are two of ASML’s largest customers. At an investor day event in November, ASML CEO Christophe Fouquet said the AI boom will help the semiconductor industry reach $1 trillion in sales by around 2030, fueling 8% to 14% annual revenue growth for ASML. Kelleher projects generative AI demand will help drive accelerating EUV demand in 2025. Argus has a “buy” rating and $1,250 price target for ASML stock, which closed at $714.36 on Jan. 3.
Adobe Inc. (ADBE)
Adobe produces creative content software and other applications used for marketing and e-commerce. The company’s Firefly generative machine learning model is generating customer interest across Photoshop, Illustrator and other platforms. Adobe has also applied its Sensei AI and machine learning technology to its Adobe Analytics, Campaign and Target products. Adobe recently launched new AI tools that allow customers to create images based on Adobe’s stock image library, while still compensating original artists. Bonner says Adobe will continue to roll out valuable new AI features across its product set. Argus has a “buy” rating and $600 price target for ADBE stock, which closed at $430.57 on Jan. 3.
International Business Machines Corp. (IBM)
For years, IBM has been developing ways to adapt its AI supercomputer Watson to revolutionize health care, finance, law and academia. IBM’s portfolio of Watson AI solutions includes applications to improve customer service, automate workflow processes and predict outcomes. IBM’s Watson Studio even helps enterprise customers build AI applications. IBM recently launched its open-source Granite 3.0 AI models catered toward business users. Kelleher says IBM’s planned HashiCorp acquisition will improve hybrid cloud and AI solutions infrastructure and security, and AI will play a central role in IBM’s future. Argus has a “buy” rating and $260 price target for IBM stock, which closed at $222.65 on Jan. 3.
Arista Networks Inc. (ANET)
Arista Networks supplies cloud networking solutions to internet companies, cloud service providers and enterprise data centers. Arista’s high-performance cloud networking solutions and high-throughput data center switches provide the processing power required for intensive AI workloads. In December, Arista became the latest of several AI-related stocks to implement a stock split following several years of AI-fueled outperformance. Kelleher says Arista is capitalizing on accelerating cloud-based data center networking demand by delivering optimal networking for AI platforms. He says Arista should be a core long-term holding. Arista has a “buy” rating and $118.75 price target for ANET stock, which closed at $115.20 on Jan. 3.
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Artificial Intelligence Stocks: The 10 Best AI Companies originally appeared on usnews.com
Update 01/06/25: This story was previously published at an earlier date and has been updated with new information.
