3 Great Artificial Intelligence (AI) Stocks to Buy in June

Most people who have to make a big decision first want to know their options. However, with so many choices, the decision-making process can still be overwhelming.

I think some investors may feel this way when choosing which artificial intelligence (AI) stocks to buy. There are many good alternatives, but I think a few are the most important. Here are three great AI stocks to buy in June.

1. Nvidia

The adjective “great” certainly applies when: nvidia (NVDA -0.79%). Shares of the graphics processing unit (GPU) maker have soared nearly 180% in the past 12 months and have delivered an impressive gain of more than 24 times over the past decade. Nvidia is the fastest-rising member of the so-called ‘Magnificent Seven’ stocks.

But what Nvidia has done in the past isn’t as important as what it can do in the future. The company’s incredible growth story won’t end anytime soon. Tech companies continue to buy up Nvidia’s AI chips as fast as they can get their hands on them.

Nvidia plans to release its new Blackwell GPU platform later this year. Blackwell will be the most powerful AI architecture ever. Unsurprisingly, demand for Blackwell has already exceeded expected supply.

Yes, Nvidia trades with a price-to-earnings ratio of nearly 65. I’ve sometimes been wary of stock valuations, but growth puts high earnings multiples in other situations. And Nvidia is poised to continue its incredibly strong growth.

2. Amazon

Amazon (AMZN -1.61%) This is another Magnificent Seven stock that has won big thanks in part to its AI initiatives. Amazon’s stock price has soared about 45% in the past 12 months, and the company has also multiplied 11 times over the past 10 years.

I predict that Amazon Web Services (AWS) will be one of the biggest beneficiaries of the generative AI explosion. It is already the largest cloud service provider. In my opinion, AWS’s approach of allowing customers to use multiple large language models (LLMs) and AI tools is a smart strategy. AWS is a major customer of Nvidia (and one of the first to acquire Blackwell), and the cloud unit also offers its own custom, cost-effective AI chips for training and inference.

Don’t overlook Amazon’s opportunity to use AI internally. The company is focused on improving profitability, as evidenced by a 225% year-over-year increase in first-quarter revenue. CFO Brian Olsavsky said on Amazon’s April earnings call that the company is investing in technology, including automation and robotics, to further reduce costs.

But AI isn’t the only reason to buy Amazon stock. Amazon has a number of growth drivers, including advertising, expansion into healthcare, and the upcoming Kuiper satellite internet service.

3. Meta platform

meta platform (meta -0.05%) It is the smallest of the three (the next smallest of the Magnificent Seven), with a market capitalization of only about $1.17 trillion. But Meta has been a monster stock, up more than 75% over the past 12 months.

I like Meta because of its valuation. The stock’s price-to-earnings-growth (PEG) ratio of 1.08 is lower than that of all other members of the Magnificent Seven. But can Meta provide growth forecasts embedded in its metrics? I think so.

The company has a great opportunity to use AI to increase monetization of its video and messaging features, including Reels and WhatsApp. We’re also working hard to engage our users to increase the value of our platform to advertisers.

CEO Mark Zuckerberg believes that “smart glasses with built-in AI assistants have a very good chance of becoming the killer app.” He believes AI-based business messaging will be the “next major pillar” of Meta’s business. Zuckerberg is also focusing on developing artificial general intelligence (AGI). But meta doesn’t have to succeed on all fronts to deliver outstanding long-term returns to investors.