2 AI stocks surge as investors look beyond Nvidia

Investors are beginning to look beyond Nvidia for AI-driven growth, sending shares of key infrastructure suppliers Micron Technology (MU) and Applied Materials (AMAT) surging while Nvidia’s own stock takes a breather. The move suggests a broadening of the AI investment theme as capital rotates into companies that provide the essential building blocks for the industry.

"While Micron faces new risks from big tech, the stock could still be an attractive opportunity for the right investor," said Adam Spatacco, a five-star rated investor, who views Micron as a "high-conviction opportunity." He argues that AI demand is "structurally different" from previous growth cycles, resting on dramatically higher volumes of data that make high-bandwidth memory a "must-have" necessity.

The enthusiasm comes as Micron posted revenues of $23.9 billion in its latest report, a 196 percent increase year-over-year, and its stock has climbed over 435 percent in the past twelve months. Wall Street shares the conviction, with a Strong Buy consensus rating based on 26 Buys and 3 Holds, and an average price target of $533.53 implying roughly 45 percent upside. Applied Materials, a key supplier of semiconductor manufacturing equipment, has seen similar investor interest.

This rotation signals a maturing market that is now exploring the entire AI supply chain, from chip designers like Nvidia to memory producers like Micron and equipment makers like Applied Materials. While Nvidia’s powerful Blackwell chips see continued strong demand, its stock has lagged, suggesting investors are taking profits and reallocating capital to other parts of the ecosystem that are also poised for significant growth from the build-out of AI infrastructure.

This article is for informational purposes only and does not constitute investment advice.