3 AI Stocks to Buy with $1,000 and Hold Forever

Do not let NvidiaThe growing popularity of AI makes you wonder how many types of artificial intelligence (AI) stocks there are. Companies in industries ranging from chips to software are poised to feel the positive effects of AI growth in the coming years.

Investors can position themselves for success by reaching out to the real winners, the cream of the crop who are equipped to stay on top as the AI ​​industry inevitably grows and evolves. Three Fool.com contributors did their homework and found Amazon (NASDAQ: AMZN), Qualcomm (NASDAQ: QCOM)And Meta-platforms (NASDAQ:META). These companies have the competitive advantage needed to succeed in the long term – and their shares can be purchased for as little as $1,000.

1. Amazon: Modest valuation makes it attractive

Jake Lerch (Amazon): My choice is Amazon. If I am make a choice Today, when it comes to an AI stock to buy and hold forever, I have to consider valuation. Simply put, AI stocks have had a turbulent time, and some of them are now at dangerously high valuation levels.

Consider this graph:

The three largest companies in the world — Apple, Microsoftand Nvidia — are at a 10-year high in their price-to-sales (P/S) ratio. This ratio is important because it reflects market sentiment, reflecting investors’ expectations for future growth, rather than quarterly fluctuations in a company’s results, which price-to-earnings (P/E) ratios tend to do.

The takeaway is that many AI stocks are hitting new highs going forward. expectations of growth, rather than on current sales. However, There are AI companies that go against this trend, or less, they are an example where the size of the increase is not as big.

Here’s the same chart, with Amazon’s P/S ratio included.

With a current price-to-market ratio of 3.6x, Amazon’s valuation is a fraction of Nvidia’s (41.8x); it is also well below Microsoft’s (14.6x) or Apple’s (9.4x). It is important to note that Amazon’s current price-to-market ratio is roughly equal to its 10-year average of 3.2x, indicating a stable valuation over time.

In other words, even though the stocks of some of its major competitors have gotten ahead during the AI ​​boom, Amazon stock still looks very attractive.

Additionally, the company has a number of AI initiatives in place, from smart speakers to its fleet of nearly a million humanoid robots. These initiatives, combined with Amazon’s strong financial position, show that it is well positioned to capitalize on the AI ​​revolution and potentially experience significant growth.

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In summary, investors looking for an AI stock to buy and hold forever should seriously consider Amazon.

2. Qualcomm: Create a connection with this action

Will Healy (Qualcomm): Over the past year, investors have focused on artificial intelligence chips. However, just because Nvidia is the leader in the sector doesn’t mean it’s the only player. With the increased focus on AI, investors may have more reason to consider Qualcomm a safe bet.

Qualcomm has…