It’s early 2026, and already the S&P 500 is on a wild, volatile ride. And a rare opportunity is emerging from the chaos of Trump’s second term — especially in high-growth AI stocks.
Markets have spent the first days of the year doing what they now do best: whipping back and forth between “risk-on” and “run for cover,” as investors digest a relentless stream of geopolitical noise and policy surprises. One day it’s headlines about Venezuela and energy flows. The next it’s a fresh round of territorial posturing, regional rhetoric, or a sudden shift in how Washington wants corporations to deploy capital.
Volatility is jarring. One week feels like a mini-1987 tape. The next feels like late-1990s momentum. And as sentiment lurches with every headline, a far more important shift is quietly taking shape beneath the surface — one Wall Street is only beginning to price in…
The macro backdrop is getting better … fast. Under all the chaos, the fundamentals have been stabilizing in a way that matters enormously for growth stocks.
The latest inflation data confirm what the market has been trying to sniff out for months: inflation isn’t reaccelerating. It’s stabilizing … and the tariff-driven reinflation wave appears to be fading.
After CPI troughed in spring 2025 and then got kicked higher by the “Liberation Day” tariff shock, inflation briefly flared, peaking just above 3% in early fall. But since then, it’s cooled steadily back toward the high-2% range, with the latest report showing continued stabilization. Even more encouraging: forward-looking estimates (like the Cleveland Fed’s nowcast) suggest the next print could step down again — potentially toward the mid-2% range.
Translation: the inflation scare that kept the Fed pinned in “higher for longer” mode is losing oxygen.
Layer that on top of visible labor market softness, and the market’s next obsession becomes obvious: 2026 rate cuts. And rate cuts and cooling inflation combined with accelerating AI-driven productivity is rocket fuel for the exact part of the market we care most about.
But the real story isn’t just the Fed … it’s Washington’s AI “industrial policy.”
Here’s what investors are still underappreciating: while the headlines scream chaos, the Trump Administration has already begun laying the groundwork for America’s AI backbone.
Not with one big splashy bill, but with a shopping cart full of moves that, together, look like the early blueprint of an “AI Interstate System”:
- Compute: Washington has agreed to take a 9.9% stake in Intel for $8.9 billion, plus a five-year warrant tied to control of Intel’s foundry business — a deliberate anchor position in a critical U.S. logic manufacturer.
- Inputs: The Defense Department’s Office of Strategic Capital has issued its first-ever loan — $150 million to MP Materials — to expand heavy rare earth separation at Mountain Pass, shoring up supply chains for the magnetic metals behind motors, sensors, and defense systems.
- Models and software: The GSA has structured a OneGov agreement with OpenAI that effectively puts ChatGPT Enterprise within reach of every agency for $1 for a year — not to save money, but to make AI adoption frictionless across government workflows.
- Energy: The Air Force has named Oklo (OKLO) the intended awardee for a pilot microreactor at Eielson Air Force Base, with a 30-year fixed-price supply structure outlined (contingent on NRC approval) — a clear signal that reliable, localized power is part of the AI buildout.
Whether you view these moves as bold strategic foresight or expensive gamble, they aren’t random. Together, they seed control points in chips, critical materials, models, and energy — the four pillars of durable AI scale.
And that matters because it changes the investment regime. This isn’t just “less regulation, more innovation.” It’s the federal government actively accelerating adoption, de-risking inputs, and wiring up power for the next decade of compute.
AI’s Engine Is Still Humming and Now the Timing Looks Right
AI stocks have been battered over the past few months amid the usual worries: overspending, valuation anxiety, circular financing fears, accounting gimmicks, and “is this demand real?” skepticism.
But the tape and the fundamentals are starting to align again.
- We’ve made it through Nvidia’s latest earnings — and while price reactions can be noisy, the underlying AI demand picture remains very much alive.
- The Fed tone has turned meaningfully more dovish, pulling the rate-cut conversation back onto the calendar.
- And technically, the market has started acting less like a “falling knife” and more like a “buy-the-bounce” environment.
At the same time, AI is increasingly proving itself in practical, ROI-generating ways — not just in lab demos. Agentic AI is moving from concept to product. Enterprise adoption is deepening. And the infrastructure buildout is still accelerating.
This is the setup we wait for: when the narrative is scary, valuations are compressed, the macro is improving, and the policy machine is quietly pointing in the same direction as the technology trend.
That’s why we believe the chaos of Trump’s second term isn’t just something AI investors can endure — it may be actively catalyzing the next leg higher.
In this report, we’ll show you the specific AI stocks best positioned to win as this new regime takes shape — and why this is one of the most compelling buy-the-dip windows we’ve seen in the AI boom.
But first, let’s dig into the context behind our 2026 thesis.
Signs of a Speculative Melt-Up (and Why AI Leads It)
Is a speculative mania forming? Quite possibly yes – and it may just be getting started. The evidence is mounting that a melt-up is underway, akin to the frenzy of the late-stage Dot-Com boom. Consider the parallels: the market is sniffing out potential Fed rate cuts, IPOs are roaring back to life, and a world-changing tech catalyst (today, AI; back then, the internet) is capturing imaginations.
We’re seeing early signs of investor frenzy: deals that would have been met with skepticism a year ago are now greeted with euphoria. Because the IPO market was left for dead in 2022–2024, it is suddenly delivering eye-watering pops. Circle Internet Group (CRCL), the stablecoin issuer, debuted in June 2025 and saw its shares soar 168% on its first trading day, eventually hitting a market cap north of $16 billion.
These aren’t one-offs. CoreWeave (CRWV), an AI infrastructure specialist, surged more than 60% after its late 2025 debut, as investors scrambled for any piece of the AI build-out. Even outside of tech, the appetite is massive; medical supply giant Medline (MDNL) priced a $6.26 billion offering in December 2025—the largest in four years—and still jumped 40% on day one. These moves echo 1999’s exuberance, when each hot ticker seemed to double on its first trade. The message is clear: risk appetite is back with a vengeance.
Meanwhile, the stock market’s leadership is evolving into a more speculative, broad-based phase. The Magnificent Seven—Apple (AAPL), Microsoft (MSFT), Amazon (AMZN), Alphabet (GOOGL), Meta (META), Nvidia (NVDA), and Tesla (TSLA)—no longer move in a perfect pack. While Nvidia still powers higher on the AI wave, investors are now rotating into “AI-adjacent” plays.
This shift is most obvious in the utilities and energy sectors, where companies like Vistra (VST) and Constellation Energy (CEG) are treated like tech stocks because of their nuclear power deals. Even more speculative names are joining the party; anything tied to the AI power grid or sovereign AI infrastructure is seeing massive inflows.
The Nasdaq remains at the forefront, but the rally now has a distinct “dash for trash” and late-cycle flavor as traders hunt for the next big winner in the second derivative of the AI boom.
We see shades of the dot-com melt-up in this dynamic. Back in late 1999, a confluence of Fed easing and internet hype drove a final vertical surge in tech stocks. Today, we have a similar cocktail: expectations of Fed cuts (with inflation in check) and AI as the transformative narrative of the decade. It’s creating a fear-of-missing-out (FOMO) environment. Traders are chasing growth stories, from AI chips to cloud software to frontier tech IPOs, with valuations growing frothy. Importantly, we are not sounding alarm bells yet – rather, we view this as a natural culmination of the cycle’s bullish phase.
Yes, there are echoes of 2000 in the air, but there’s a key difference: unlike the dot-com era, many of today’s leading tech firms have real revenue and profits behind their surges. Not every tech wave results in lasting gains – the 2000 crash taught us that – but today’s AI leaders are backed by real earnings and transformative use cases, not just eyeballs on a webpage. In other words, it’s a speculative melt-up with substance.
Several statistics underscore how extraordinary this moment is – and why AI stocks are at the heart of it:
- Inflation holds firm, optimism remains: U.S. inflation has cooled from its peaks but remains “sticky.” As of January 2026, annual CPI is running at 2.7%. While this is above the Fed’s 2% target, the market remains optimistic that the “soft landing” is intact, keeping the liquidity taps open for tech and other risk assets.
- Tech earnings acceleration: Despite concerns over massive spending, tech giants are proving the ROI. Microsoft recently reported that Azure cloud revenue jumped 40% year-over-year, fueled by OpenAI commitments. Meta is ramping up its AI “industrialization,” with plans for a staggering $100 billion in capital spending for 2026 to power its agentic AI tools. Amazon also saw a re-acceleration, with AWS revenue growing 20.2% to $33 billion in its most recent quarter—its highest growth rate in nearly three years. Even Nvidia—the AI benchmark—saw revenue soar 78% in its latest fiscal year results as data center demand hit record levels.
- AI hardware gold rush: The supply chain can’t keep up. Broadcom (AVGO) recently guided for its AI revenue to double in 2026, backed by a massive $10 billion XPU deal with Anthropic. Meanwhile, TSMC (TSM)—the world’s foundry—forecasts that AI-focused revenue will grow up to 30% this year, driven by the explosive demand for server accelerators and the shift to 2-nanometer chips. The takeaway? AI infrastructure is the new “must-have” utility.
- IPO and risk revival: Circle’s (CRCL) 168% moonshot debut in 2025 has set the stage for a massive 2026 pipeline. All eyes are now on SpaceX, which is reportedly pursuing a listing that could raise over $30 billion—potentially the largest IPO in history. This rush to tap public markets, alongside a resurgence in speculative fervor for small-cap AI plays, is classic late-cycle behavior. It’s 1999 redux, with an AI-era twist.
In our eyes, these signals point to a speculative melt-up forming in real time. The combination of macro tailwinds (Fed pivot, trade relief) and secular tech mania (AI, AI, and more AI) is creating a powerful feedback loop.
Each positive earnings report or hot IPO further emboldens risk-taking, which pushes stock prices higher, which then attracts even more capital off the sidelines. It’s the classic recipe for a melt-up – a final explosive rally driven less by careful fundamental analysis and more by momentum and FOMO.
And while that might sound scary to some, our stance is that investors should embrace it strategically. Melt-ups can run far longer and higher than anyone expects, and they often deliver astounding gains to those who position early – before the crowd.
Early-Stage Entry Into an AI Hypergrowth Wave
It’s easy to get caught up in the daily news cycle – one minute Trump tweets tariffs, the next he’s hinting at tax cuts, and the market lurches accordingly. But we urge investors to zoom out. The medium-term trajectory is firmly upward for the innovators at the heart of the AI revolution.
Yes, volatility will be our companion. There will be more headline-induced stumbles and sudden rallies as Washington alternates between confrontation and growth initiatives. Yet, beyond that noise, the fundamental narrative is extraordinarily bullish: AI is unleashing a new wave of productivity and profit growth, and the U.S. policy environment is shifting to nurture it. We’re moving from an era of Fed constraint and geopolitical angst to one of monetary easing and technological optimism.
For us, this moment feels like a rare early-stage entry point – the kind you might have seen in retrospect with the internet in the mid-90s or smartphones in the late 2000s. Despite the recent run-up, many AI stocks are just beginning their hypergrowth trajectories. The backdrop (soft inflation, pro-tech policies, huge leaps in AI capability) suggests a multi-year boom ahead, even if there are bumps along the way.
Imagine being an investor in 1998, just before the internet really upended business – there were wild swings and even a melt-up in 1999, but those who stayed invested in transformational companies (Amazon, Cisco, Apple, etc.) ultimately reaped generational rewards. There’s a similar setup now with AI. The coming months may bring late-90s-like excitement – maybe even excess – but within that froth lies the opportunity of a lifetime to buy into the Next Big Thing.
So how should we be positioning tactically? In a word: offense. We’re leaning into high-conviction AI and tech names on every dip, capitalizing on short-term fear to build positions for the long run. The recent market pullbacks on trade headlines have been chances to accumulate top-tier AI stocks at a relative discount. We’re not blind to the risks – a policy mistake or external shock could jolt markets – but we believe the risk of missing out on this AI-driven upcycle is far greater.
With Big Tech’s earnings proving the AI boom is real and accelerating, and with Washington’s stance gradually shifting from headwind to tailwind, the stars are aligning for a sustained move higher in tech. We even may be at the start of a new “hypergrowth wave,” one that could outperform the last decade’s run. If the late spring pullback scared you, look past it. The medium-term path, as we see it, is pointed decisively upward.
Which Sectors Could Thrive Under Trump 2.0?
Despite the drama in Washington, the AI megatrend hasn’t slowed. It’s accelerating. That’s why we’re doubling down on our top seven AI stock picks for this administration.
One of the clearest signals from the new administration: President Trump revoked Biden’s 2023 executive order on AI on his first day in office. This removed the U.S. AI Safety Institute (AISI) from the driver’s seat and scrapped transparency requirements around model training.
Now, federal oversight is shifting toward a “national policy framework” designed to preempt a patchwork of state-level laws, like those in California and Florida. The likely outcome? A hypercharged race for AI innovation, driven by less regulation and more political backing for tech.
However, logistics remain a hurdle. Trump’s 100% tariffs on certain semiconductor imports could raise costs for the GPUs essential for training large models. While TSMC is shielded by its $165 billion U.S. investment commitment, other hardware players are feeling the squeeze.
Big Tech: Still Crushing It
Even amid tariff shocks, Big Tech is hitting new milestones. Here is the state of the “Magnificent” AI leaders in 2026:
Amazon (AMZN)
- Next-Gen Logistics: “Blue Jay” robotics are now stowing and picking in fulfillment centers, collapsing three assembly lines into one and reducing processing time by 25%.
- Ad Dominance: GenAI advertising tools are fueling 20%+ growth in ad revenue by auto-generating high-performing creative for sellers.
- AWS Surge: AWS revenue jumped 20.2% in the latest quarter, its highest growth in years, as enterprises shift from experimentation to deployment.
- Infrastructure: Over $100 billion is earmarked for AI investment in 2026, including custom chips like Trainium and Inferentia.
Alphabet (GOOGL)
- Gemini Everywhere: Gemini is now the backbone of more than 15 Google services, with AI Overviews in Search driving higher user engagement and monetization.
- Agentic Future: Firebase Studio has launched as an agentic development suite, allowing developers to build “auto-run” AI agents that manage entire apps.
- Capex: Alphabet is allocating $75 billion for capital expenditures in 2026, focusing heavily on custom TPUv6 chips and server infrastructure.
Microsoft (MSFT)
- Enterprise Adoption: Over 90% of the Fortune 500 have adopted 360 Copilot, with usage intensity rising 50% quarter-over-quarter.
- Cloud Momentum: Azure AI demand is growing so fast it is currently outstripping supply; revenue jumped 40% year-over-year in the most recent report.
- Agent HQ: Microsoft launched Agent HQ as a mission control layer for multi-agent development, positioning it as the “OS” for the agentic web.
Meta (META)
- Massive Reach: Meta AI now serves nearly 1 billion monthly active users across WhatsApp, Instagram, and Messenger.
- AGI Push: The company is ramping up “Superintelligence” initiatives, with a planned $100 billion capex budget for 2026 to achieve AGI-scale breakthroughs.
- Scaling Up: Meta’s internal automation tools are driving margins higher even as it spends aggressively on the Llama 4 and Llama 5 pipelines.
The 2026 Opportunity
If federal guardrails continue to fall, AI innovation could hit another gear. Without Washington slowing things down, the next generation of AI breakthroughs could arrive far sooner than expected.
I recommend looking at the full breakdown of our seven best AI stocks to buy for 2026. These aren’t speculative moonshots; they are high-conviction companies dominating the cloud, chips, and robotics sectors.
With that said… let’s meet our newest favorite buy-the-dip plays right now.
The Top AI Stocks to Buy for 2026 #1:
Palantir (PLTR)
Forget money. In the business world, data is king.
It can help businesses create better products, enhance marketing campaigns, reach targeted customers, and glean sentiment.
Data can assist with mitigating risk, predicting business outcomes, optimizing supply chains, streamlining functions, and automating various processes.
For a business, data can do everything.
It should be no surprise, then, that data-driven companies are 23 times more likely to outperform in customer acquisition, 19 times more likely to stay profitable, and roughly seven times more likely to keep their customers. Further, a 2021 Gartner survey found that in 75% of large organizations, the office of chief data officer is seen as a mission-critical function, on par with IT, business operations, HR, and finance.
Welcome, friends, to the Intelligence Economy — a new era where enterprises are unlocking the power of big data to drive better business outcomes through AI.
And in today’s world, it’s dog eat dog — if you don’t adopt data-driven decision-making, you’ll be driven out of business by someone who does.
To that end, the Intelligence Economy boom has only one ending — where, by 2030, every business in the world is data-driven.
And yet, a 2019 New Vantage survey found that only 31% of companies have pivoted to data-driven decision-making.
This delta between the current state of the enterprise market (less than one-third adoption of Big Data software) and its future state (100% adoption) implies enormous growth potential for the Intelligence Economy over the next decade.
More specifically, it means that the companies at the epicenter of intelligence — the AI firms creating analytics software — are poised for significant revenue growth in the 2020s.
The time to invest in these often still-small AI/Big Data stocks is now because they won’t be small for long.
One such company is Palantir (PLTR): a revolutionary data science firm that is pioneering an AI-powered approach to data analytics, which the company hopes will one day be standardized across the industry.
Palantir got its start in 2003 to develop advanced software for the U.S. intelligence community’s counterterrorism investigations and operations. The technology the company has built to that is world-class.
Since 2003, Palantir has grown this government-focused data science platform by leaps and bounds. Today, Palantir’s platform is considered the “gold standard” in government data analytics and has been used to power emergency noncombatant evacuation operations from Afghanistan; power the U.S. vaccines program; help identify a $200 billion Russian money-laundering operation; and fuel the Public Safety Power Shutoff program to mitigate wildfire risks.
Now Palantir is further commercializing that technology by expanding into Corporate America. Thus far, those expansions have been wildly successful. Commercial revenues have been growing in excess of 15% for the past several years.
The Denver-based company plans to continue to rapidly scale its government and commercial businesses via new customers, new product launches, and higher fees. Behind that growth engine, Palantir’s management team expects to grow commercial revenues in excess of 3,015% per year over the next few years.
Our bull thesis on Palantir in the Age of AI boils down to three simple things:
- Data is the most valuable asset in the world.
- AI applied to data will unlock huge economic advantages for governments and companies.
- Palantir is the best in the world at applying AI to data.
We believe Palantir is still in the early stages of discovering its true value proposition, much like Microsoft in the 1980s and ’90s.
In the early days of Microsoft Office, folks thought that programs like Word and Excel would be niche office productivity tools. A few decades later, they are in near-constant use, installed on basically every computer in the world.
Similarly, in the early days of Palantir, a lot of people thought of Palantir’s data science platform as a niche productivity tool. But we think that in 10 to 20 years, simplified versions of Palantir’s software could be installed on every computer, putting AI in the hands of every consumer in the world.
Palantir’s launched its Artificial Intelligence Platform — or AIP — in the second quarter of 2023, and already it is setting the gold standard for enterprise AI adoption.
In Q4 2022, Q1 2023, and Q2 2023 — the three quarters before the launch of AIP — Palantir was growing its commercial sales by 10% to 15% every quarter.
In the quarter after the launch of AIP — the third quarter of 2023 — Palantir’s commercial sales growth rate jumped up to 23%.
The following quarter — the fourth quarter of 2023 — it surged to 32%. Ever since, it has remained above 25%.
In other words, the launch of AIP has turned Palantir’s commercial business from a 10% to 15% grower to a >25% grower.
We think this elevated growth trajectory has staying power for the following reasons:
- AIP is a fantastic product.
- AIP is still in the early stages of adoption.
- And companies are more aggressively and urgently looking to invest in enterprise AI software.
We therefore think that Palantir’s commercial business will continue to grow at a robust pace for the foreseeable future, powered by AIP expansion.
Meanwhile, the government business is accelerating, too, from ~10% sales growth a few quarters ago to >20% sales growth last quarter.
For similar reasons as the commercial business, we think Palantir’s government business will stay red-hot, too, as governments upgrade their information technology infrastructure to the AI era. As such, government interest in AI has grown significantly, with a recent analysis showing a 1,200% increase in AI-related government contracts.
For example, Anthropic has announced a partnership with Palantir and Amazon Web Services to provide U.S. intelligence and defense agencies access to its Claude AI models. This collaboration aims to integrate Claude into Palantir’s platform using AWS hosting, making it available in Palantir’s defense-accredited environment at Impact Level 6 (IL6).
The move is part of a growing trend of AI companies seeking deals with U.S. defense customers, with Meta and OpenAIalso pursuing similar relationships. Anthropic’s head of sales, Kate Earle Jensen, emphasized the potential for Claude to enhance analytical capabilities and operational efficiencies in vital government operations.
The partnership will allow U.S. defense and intelligence organizations to use Claude within Palantir on AWS, enabling them to process and analyze vast amounts of complex data rapidly. This is expected to improve intelligence analysis, decision-making processes, and operational efficiency across departments.
Putting it all together, Palantir seems well positioned for several years of >20% sales growth ahead. The company is also driving all this growth without incurring much additional cost. The products are so good that they appear to be selling themselves. As a result, operating margins have soared from <20% in Q3 2022 to nearly 40% today. We see this margin expansion continuing, too, meaning >20% sales growth could translate into >30% profit growth.
That impressive profit growth trajectory should be enough to keep PLTR stock on a winning path for the foreseeable future.
Palantir is unequivocally one of the top AI stocks to buy for the next several years.
The Top AI Stocks to Buy for 2026 #2:
Tesla (TSLA)
As we mentioned earlier in this report, Elon Musk stands to benefit from a successful election push with U.S. President Donald Trump, who appointed Musk to a newly-established government efficiency commission (aptly dubbed “DOGE” for Department of Government Efficiency to slash federal spending. Such a position could provide Musk with enormous influence, especially as it relates to regulations impeding Tesla’s Full-Self-Driving (FSD) progress.
Unless you’ve been living under a rock, you’ve probably heard about Tesla’s (TSLA) Robotaxi.
We got the full scoop from Elon Musk at his Robotaxi event in October, where he unveiled Cybercab (2-seater) and Robovan (20-seater), both without steering wheels or pedals, resembling Cybertruck design.
While details were scarce, the Cybercab is expected to launch before 2027, priced below $30,000. No date was given for Elon’s Robovan, but both appear to be camera-based.
Broadly, Elon Musk expects unsupervised FSD to be active in Texas and California by late 2026 for current Tesla models, pending a final regulatory green light. Because Musk views the existing patchwork of state laws as an impediment to innovation, he is now using his seat at the table in the second Trump administration to advocate for a national autonomous vehicle framework.
His goal is clear: remove the friction of state-level oversight and replace it with a federal standard that would allow Tesla to scale its Cybercab and Model Y fleets nationwide without waiting for individual city permits. With the NHTSA already signaling a more permissive stance on “driver-out” testing and a new federal bill (the SELF DRIVE Act of 2026) moving through Congress, those once-formidable regulatory hurdles are beginning to vanish.
In fact, it’s highly likely Musk will pursue the removal of certain regulations, as several of his businesses — including SpaceX and Neuralink — depend on favorable government regulations, subsidies, and policy.
The centi-billionaire tech magnate’s pro-innovation/anti-regulation philosophy could continue to be a driving force in the Trump administration, allowing Musk to bend AI and FSD environments to his will.
Collectively, Musk’s businesses and products form the foundation for a potentially large business at Tesla around AI. They are unequivocally the future.
And arguably his two most important businesses — xAI and Tesla — are backed by some of the world’s most advanced supercomputers — Colossus and Dojo.
Behind Musk’s xAI venture is the powerful supercomputer Colossus, based in Memphis, Tennessee. Built in just four months, Colossus uses 100,000 Nvidia H100 GPUs, making it the fastest AI training system in the world. This $3 billion investment aims to accelerate AI development, particularly for xAI’s chatbot Grok. Colossus sets a new standard for AI infrastructure, even outperforming other Big Tech giants like Meta, Microsoft, and OpenAI. The system’s vast computational power is expected to enhance Grok’s capabilities and unlock new AI possibilities.
Tesla has been leading AI development in the automotive industry with its FSD technology. While Tesla has its own supercomputer for training FSD systems, Colossus could be used to improve Tesla’s AI projects.
Looking forward, xAI plans to expand Colossus’s capacity, potentially doubling it to 200,000 GPUs in the coming months. This expansion reflects Musk’s ambition to lead the AI revolution.
The supercomputer’s immense processing power and potential for collaboration across Musk’s companies position him at the forefront of AI development, potentially revolutionizing various industries from automotive to space exploration.
Then there’s Tesla’s own supercomputer: Dojo.
If Dojo is the “real deal” – and I think it is – then this could become the leader of the “Artificial Intelligence Boom.”
Wall Street’s AI Boom began in late 2022 with ChatGPT’s launch. Since then, Nvidia has been the poster child for AI stocks. That’s all thanks to burgeoning demand for the firm’s next-generation GPUs, which are used to make and run robust AI models. NVDA stock has surged ~200% higher in the past year alone.
But there is growing concern among some in the industry that demand for Nvidia GPUs is maxing out – and that the big players in the AI Race will start using different GPUs.
Insert Dojo.
Previously, Tesla powered its self-driving operations with a large Nvidia GPU-based supercomputer. But now, Dojo isTesla’s AI-powered supercomputer.
Being the “brain” behind Tesla’s self-driving operations, Dojo parses an incredible amount of driving data to help develop Tesla’s self-driving algorithms.
In other words, Tesla previously used Nvidia GPUs. But now, the EV firm has developed its own supercomputer that uses its own GPUs custom-built for its AI needs.
And it could very well do the same for Colossus.
In the early innings of the AI boom, Nvidia won big by supplying very advanced but very general-use GPUs to companies looking to develop broad AI models.
But as the AI race has matured, those companies are now looking to develop more sophisticated and specialized AI models. For that, they need custom-built GPUs. And economically speaking, it doesn’t make sense for Nvidia to create custom-built GPUs for every single one of its customers.
So, Nvidia’s largest customers are developing their own custom-built GPUs to meet their own specialized AI needs.
Tesla and its Dojo supercomputer are just one example.
The Top AI Stocks to Buy in 2026 #3:
Symbotic (SYM)
Symbotic (SYM) is an AI-powered supply chain logistics company. It got started in 2006 with the purpose of developing next-generation technologies to improve operating efficiencies in modern warehouses.
Over the past 16 years, the company has worked tirelessly to perfect a full suite of AI and robotics technologies to fully automate any warehouse. Today, the company has realized that vision via a single autonomous warehouse system architecture that combines both software and hardware to automate basically every function of a warehouse.
To our knowledge, Symbotic is the only firm in the world that has created a fully autonomous, end-to-end warehouse system architecture that is in operation today.
The science and engineering behind the system is highly complex, but the process is very easy to understand.
Essentially, several robotic arms take inbound pallets at a distribution center and deconstruct them into individual items. Those items are placed on various mobile robots – called SymBots – which drive them to a temporary storage location at the distribution center. Subsequently, when those items are ready to be shipped to a store, the SymBots fetch and deliver them to another set of robotic arms, which construct a new outbound pallet to be delivered to the store.
The whole system is run by an AI software “brain” that informs where packages are stored, when they are fetched, and how pallets are constructed and deconstructed.
It is a single, highly complex solution for order fulfillment.
This system can be outfitted for distribution centers of any size. Typically, a Symbotic system has 400 intelligent robotsand around five to 10 inbound and outbound cells. The whole system is powered by proprietary AI software and is protected by over 400 patents.
The technology is cool. Better than that, it works.
Two summers ago, Walmart (WMT) signed a deal to automate some of its distribution centers with Symbotic technology. Since then, a few of those distribution centers have been retrofitted with Symbotic tech, and they’ve achieved industry-best stock-keeping unit (SKU) counts.
In fact, Walmart was so impressed with the early results of Symbotic’s tech that, just last summer, it dramatically expanded the scope of the initial partnership to include all 42 of its regional distribution centers in America. In other words, every one of Walmart’s regional distribution centers in America will be automated by Symbotic tech by 2027.
Of course, that represents a huge vote of confidence in Symbotic tech. It also represents a massive ~$10 billion revenue contract for the Boston area-based company.
But Walmart is just the tip of the iceberg here.
C&S Wholesale Grocers – the largest U.S. wholesale grocery distributor – is also a big adopter of Symbotic tech and will likely make it a ubiquity by the late 2020s, too. Albertsons (ACI) – the world’s third-largest supermarket chain by revenue – has already integrated Symbotic tech into two of its distribution centers, with more orders on the way. And the distribution centers already live with Symbotic tech are reporting industry-best throughput.
Altogether, Symbotic has a massive order backlog that measures over $23 billion today, and it seems to be growing rapidly every single quarter.
But even that is still just the tip of the iceberg.
There are thousands of warehouses and distribution centers all over North America and Europe that could benefit from using Symbotic’s tech. After all, the estimated lifetime savings of this tech measures $250 million per module.
These cost savings are ubiquitously attractive to warehouse operators. Who doesn’t want to save $250 million per warehouse?
Meanwhile, Symbotic is the only company today with a proven technology platform that can verifiably drive those enormous cost savings. Plus, the company’s existing partnerships with Walmart, Albertsons, and C&S Wholesale Grocers give it ample runway to extend its market leadership in the coming years.
To that end, we believe it is highly likely that Symbotic successfully penetrates a significant portion of its estimated ~$400 billion total addressable market in North America and Europe, across the general merchandise, food and grocery, apparel, home improvement, auto parts, and third-party logistics (3PL) markets.
At just 5% market share, that implies $20 billion annual revenue potential for Symbotic. Management is targeting 25% earnings before interest, taxation, depreciation, and amortization (EBITDA) margins as the business scales. That combination means Symbotic has the potential to produce $5 billion in annual EBITDA within the next 10 years. A simple 20X multiple on that means this could be a $100 billion company within a decade.
The company is worth just $19 billion today.
The long-term upside potential is enormous, even under conservative assumptions. And, just as important, considering early validation of the transformative tech from Walmart, Albertsons, and more, the stock’s ability to realize its upside potential is high.
This is unequivocally one of the top AI stocks to buy for the next several years.
The Top AI Stocks to Buy in 2026 #4:
AppLovin (APP)
Let’s be honest: There are some amazing buying opportunities emerging under a Trump administration. Growth stocks, particularly in the technology sector, are anticipated to be the biggest winners…
The reality is that, no matter who won the Presidential election, technological transformation won’t stop or even slow anytime soon. War or no war, inflation or no inflation, QE or no QE, innovative new tech platforms will continue to reshape our lives over the next several decades.
Therefore, if time is on your side, the best thing you can be doing right now as an investor is buying the AI stocks poised to soar throughout 2026.
Of course, certain buying opportunities look more appetizing than others…
Take AppLovin (APP) — a mobile marketing software company that has created a suite of tools to help mobile app developers publish, scale, market, and monetize their apps. Those tools include:
- AppDiscovery: A machine-learning-powered engine that uses proprietary algorithms to optimally connect the right apps to the right people.
- MAX: An ad-tech platform that allows mobile app developers to maximize revenue with in-app bidding.
- AppLovin Exchange: A programmatic mobile ad exchange that connects ad buyers to open mobile ad real estate.
- SparkLabs: A creative design engine that helps mobile app developers create more engaging ads and content.
- Adjust: An analytics engine that allows developers to automatically adjust their mobile marketing campaigns.
AppLovin is widely regarded as a leader in the mobile marketing software industry, which is scaling very quickly. AppLovin was founded in 2012 and came out of stealth mode in 2014. The company went public via an IPO in April 2021 at $80 per share. Today the stock trades at $250, with an $80 billion market cap.
Last year, the company’s revenues rose 92% year-over-year to $2.8 billion.
The company runs at ~80% gross margins, with 20%-plus EBITDA margins and positive net-profit and cash-flow margins.
AppLovin operates in a very competitive mobile advertising market, but it has cemented itself as one of the higher-quality players in the space with top-tier solutions and big-name clients.
This quality differentiation has only widened over the past 12 months as AppLovin has been the industry’s first-mover when it comes to integrating AI into its product suite. Its latest AI-upgraded platform – called AXON 2 – launched last year, and in just a few quarters, it has helped power ~50% growth across its software business. AppLovin is actively working to expand AI use across its entire product suite and hopefully achieve similar accelerated growth results in other business segments.
Post-election, APP stock shot up almost 50% after the marketing tech firm reported blowout quarterly numbers, driven in large part by the exceptionally strong demand for the company’s new AXON AI marketing placement tool.
In short, AppLovin is the leader in the secular-growth mobile advertising sector with a huge opportunity to drive market share expansion and accelerated growth through new AI tools.
The long-term bull thesis here is pretty simple:
Over the next several years, global advertising spend is likely to rise by 5% per year, in-line with historical standards of being just above average GDP. Digital ads will continue to expand their share of total ad spending, fueling around 6% to 8% growth per year in digital ad spending. Of that, mobile advertising should gradually expand its share, too, leading to ~10% growth per annum in mobile digital ad spending over the next several years.
We believe that AppLovin will be able to leverage its AI-driven product innovation to expand share of the mobile ad industry, leading to 10% to 15% compounded revenue growth. Those new AI products should give AppLovin more pricing power, which will push gross margins higher, while inherent economies of scale should drive positive operating leverage. The sum result? 20%-plus compounded earnings growth over the next several years.
That’s a great growth profile…
Indeed, we see earnings per share rising above $7 by the end of the decade.
AppLovin’s (APP) EPS estimates continue to charge higher as the market digests the full impact of its AI-led transformation. For fiscal year 2025, consensus analyst estimates have skyrocketed from $5.49 to $9.32, and expectations for 2026 now sit at a massive $15.14.
Long term, APP stock looks exceptional. The company is driving sustained 30%+ revenue growth and 80%+ EBITDA margins on the back of AXON AI, which is proving to be a generational winner in ad-tech. Now that AppLovin has divested its slower-growth mobile gaming unit to focus entirely on its AI software platform, it is a pure-play powerhouse. Because AXON is still in the early innings of expansion into e-commerce and web advertising, we believe APP can continue to drive 20% to 30% compounded revenue growth and outsized profit leverage for the foreseeable future.
However, valuation friction remains a primary hurdle. APP stock currently trades at roughly 41X estimated 2026 EPS (and over 65X trailing earnings). While this is a premium multiple, the company’s triple-digit profit growth makes it a rare find. That said, the stock has been a “crowded trade” lately, and any macro-driven volatility could trigger a sharp pullback. Because of this high valuation, we recommend you wait for a better entry point—ideally on a 10-15% dip—before scaling into a full position.
The Top AI Stocks to Buy in 2026 #5:
Aerovironment (AVAV)
We like drones. Yet, our model portfolio has very little drone exposure. AeroVironment (AVAV) is our fix for that.
AeroVironment is emerging as one of the purest ways to play the “drone + AI” defense supercycle. The simple bull case: the Pentagon is pivoting hard toward unmanned, autonomous systems, and AV sits right at the intersection of small drones, loitering munitions, counter-drone systems, and AI battle-management software – with real contracts and a big backlog already in hand.
AeroVironment is a U.S. defense-tech company that designs and builds unmanned systems and related tech across air, land, sea, space, and cyber. Historically, they’re best known as the U.S. military’s top supplier of small drones, including the Raven and Puma reconnaissance drones and the Switchblade loitering munition family.
They recently closed a $4.1B all-stock acquisition of BlueHalo, creating a much larger platform with loitering munitions, counter-UAS, directed-energy lasers, space-based laser communications, and mission software under one roof.
The combined company is guiding to $1.9–$2.0B in FY26 revenue and $300–$320M in adjusted EBITDA, with Q1 FY26 revenue up 140% year over year and backlog at a record $1.1B – clear evidence that demand for this toolkit is already surging.
Since Ukraine, U.S. and NATO planners have basically admitted that drones are no longer a niche tool – they’re central to modern war. Reports from CSIS, CEPA, and others highlight that in Ukraine, unmanned systems account for a huge share of procurement, millions of drones are being produced, and 60%+ of targets are now hit by drones.
The U.S. Army is openly talking about treating drones as “consumable munitions” and plans to buy at least 1 million drones over the next two to three years, a massive step-up from ~50,000 per year today.
At the same time, the Pentagon’s Replicator initiative is focused on autonomous swarms and low-cost unmanned systems. The big picture: U.S. strategy is shifting away from relying purely on a few exquisite, manned platforms and toward armies of smart, cheap, unmanned systems at the edge – exactly where AeroVironment lives.
AVAV isn’t some newcomer riding the hype wave – it’s the incumbent in small military drones. The company designs the Raven and Puma drones, which constitute the vast majority of the U.S. Army’s small UAS fleet and are used widely by other U.S. services and allies for frontline ISR.
On the strike side, AeroVironment’s Switchblade loitering munitions have become iconic – so much so that the U.S. Army awarded the company a five-year IDIQ contract worth up to $990M to supply Switchblade 300 and 600 systems to infantry units, part of a push to give light forces tank-killing, long-range punch.
AVAV has also just secured a $96M contract for the Freedom Eagle (FE-1) counter-drone missile, beating out RTX – a sign that it’s now being treated as a serious missile and counter-UAS prime, not just a “drone company.” Add in a brand-new $874M Army contract for Puma and Raven systems for foreign military sales, and you have a company that is already a go-to supplier for unmanned systems across multiple mission sets and customers.
The really interesting part of the story is that AV is evolving from “drones and missiles” into an AI-software-defined defense platform. The company recently launched AV_Halo, a hardware-agnostic, AI-powered software platform that fuses multi-domain sensor data, provides AI-enhanced intelligence analysis, synthetic training, and autonomous targeting, and offers multi-domain command-and-control through a single open-standards ecosystem.
AV_Halo ties together AV’s drones, loitering munitions, counter-UAS lasers, and third-party systems into one “detect, decide, deliver” stack. It uses onboard computer vision (SPOTR-Edge, WISARD AI/ML) for autonomous targeting and is being integrated with open standards like JAUS to control 25+ uncrewed systems from multiple manufacturers through one interface – exactly the kind of AI-enabled battle management layer modern militaries are looking for.
That means AV isn’t just selling hardware; it’s building the AI brain and nervous system that coordinates lots of autonomous systems in the field.
The U.S. is now explicitly worried about drone dependence on China and is trying to build a domestic industrial base that can surge production in wartime. Reuters reports the Army wants to ramp up to 1M drones in a couple years and is pushing funding across a network of U.S. manufacturers to secure supply and reduce reliance on Chinese components.
AV already has a national manufacturing footprint and is fielding exactly the kind of systems the Pentagon wants – small ISR drones, loitering munitions, counter-UAS missiles, laser weapon systems, and now space-based laser communications terminals for secure data links – backed by a record $1.1B backlog and multi-hundred-million-dollar awards.
In that context, it’s not hard to imagine the U.S. government leaning even harder into AV – whether through very large, multi-year procurement programs (Switchblade, Puma/Raven, FE-1, laser comms, directed energy) or, in a more extreme national-champion scenario, a direct or indirect equity stake if Washington decides to explicitly “lock in” critical drone and autonomy capacity the same way it has backed other strategic industries.
“Everything goes right” revenue and EBITDA potential by 2030
Today, the combined AV/BlueHalo entity is guiding to about $1.9–$2.0B of revenue and $300–$320M of adjusted EBITDA in FY26, implying roughly a 16% EBITDA margin.
In an “everything goes right” scenario where (1) global defense budgets stay elevated, (2) drones, loitering munitions, and counter-UAS systems soak up a big share of that incremental spend, (3) AV continues to win major programs like Switchblade, FE-1, laser comms, and directed energy, and (4) AV_Halo matures into a meaningful AI software platform with higher-margin revenue, it’s reasonable to imagine high-teens to low-20s annual revenue growth through 2030. On that trajectory, AV could plausibly be doing on the order of $3.8–$4.4B in annual revenue by 2030, with EBITDA margins stepping up into the 18–22% range as mix shifts toward software, services, and scaled production.
That would put “blue-sky” 2030 EBITDA somewhere roughly in the $700M to $1B+ neighborhood – 3× or more today’s guidance – if the AI-drone supercycle truly materializes and AV keeps winning.
Those numbers are not guaranteed, of course, but they give you a sense of how big this can get if AeroVironment becomes one of the core, AI-enabled drone champions of the U.S. and its allies.
The Top AI Stocks to Buy in 2026 #6:
Oklo (OKLO)
Oklo (OKLO) is a long-term play on AI energy—and may be the strongest bet on the theme.
The company is developing compact nuclear power plants, or microreactors, designed to deliver steady, carbon-free electricity. With inherent safety features and a small footprint, these reactors can be deployed near data centers, defense sites, or campuses. Oklo’s strategy is to manufacture standardized units and sell decades of reliable power through long-term contracts rather than one-off equipment sales. That model locks in predictable revenue and appeals to customers facing slow or unreliable grid upgrades.
The biggest bottleneck for AI expansion isn’t chips — it’s electricity. Data centers need round-the-clock, stable power that intermittent renewables can’t guarantee alone. Microreactors placed close to hyperscalers reduce transmission losses and boost resilience, while also helping companies hit carbon-reduction targets. If Oklo can scale production, its reactors could become a foundational enabler of future compute growth.
Nuclear is heavily regulated, creating high barriers to entry but also durable moats. A first mover with licensed designs, early deployments, and strong ties to regulators and agencies can establish credibility competitors will struggle to match. Standardized manufacturing and streamlined siting/permitting are as critical as the technology itself. Once deployed, long-tail service contracts provide recurring revenue and deepen customer relationships. Demonstrating a successful reference site will be key to unlocking follow-on demand.
If power supply proves to be the gating factor for AI data centers, customers will seek alternatives to congested grids. Microreactors that deliver reliable, low-carbon baseload power close to demand could command premium, multi-decade contracts. Near-term opportunities lie in defense and remote industrial applications, with commercial data centers as the bigger prize. Standardization should lower costs over time, supporting higher margins and competitiveness. Investors gain leverage if Oklo converts prototypes into repeatable deployments, with the potential for stable, compounding cash flows under long-duration contracts.
Over the next 12 months, milestones to watch include licensing progress, site selection, and early power-purchase agreements. Announcements of demonstration projects or partnerships with cloud operators would validate commercial traction. Supply-chain updates that show repeatable builds, alongside policy support for advanced nuclear, could reduce perceived risk. Defense or government pilot contracts would provide credibility, while clearer deployment timelines would help size near-term revenue.
Bottom line: OKLO is a long-duration play on nuclear microreactors becoming the backbone of AI data-center power.
The Top AI Stocks to Buy in 2026 #7:
Axon Enterprise (AXON)
Law enforcement technology company Axon (AXON) has long been one of my favorite growth stocks in the market. Axon is a law enforcement technology solutions provider that is helping police agencies across the globe modernize and leapfrog into the digital era. The company’s core offerings include body and dash cameras, tasers and smart weapons, and cloud-hosted records management and dispatch software.
My bullishness dates back to when Axon was still named Taser International, and traded under the ticker symbol ‘TASR.” At the time, the TASR stock price was $20. Today, AXON stock trades near $500.
The bull thesis on AXON stock this entire time has been shockingly consistent and simple.
Law enforcement agencies across the globe are antiquated. They’re stuck in the 20th Century. They need to modernize and digitize. Axon is creating a suite of compelling products to help them do just that, like body cameras, smart weapons and cloud-hosted records management systems.
The company has virtually no competition in this space, having either acquired or squashed all other relevant police tech companies.
The opportunity is enormous, as police spending in the U.S. measures nearly $200 billion every year — and peaks into the trillions of dollars globally. The business model is highly profitable, as Axon commands pricing power on its hardware products given the lack of competition, and is quickly growing its much-higher-margin software business.
From head to toe, AXON stock is a winner. That much is obvious. But you may be looking at the AXON stock chart and asking yourself: Did I miss the opportunity to buy AXON stock?
No. Far from it. In fact, there’s never been a better time to buy AXON stock.
Here’s why.
With Donald Trump now the President-elect of the United States, police spending in America is in a position to surge over the next few years — and all those dollars will likely get allocated to the things Axon sells.
Here’s the thing.
According to Trump’s campaign, “there is no higher priority than quickly restoring law and order and public safety in America.”
During Trump’s previous tenure as the U.S. President, he threatened to deploy the National Guard into major cities to quash violence. He also aimed to militarize the police, swiftly rolling back President Barack Obama’s executive order limiting the distribution of military-grade weapons to state, local, and federal law enforcement agencies.
So, it’s safe to say that police spending will increase dramatically over the next four years — and maybe even longer.
Over that stretch, sociopolitical pressures will force law enforcement agencies to spend that extra budget on things that actually improve law enforcement operations. Things like smart weapons (to decrease fatal encounters), body cameras (to increase transparency), cloud solutions (to improve operational efficiency), etc.
Axon sells all of those things. Indeed, they sell the best smart weapons, the best body cameras, the best cloud solutions, so on and so forth.
Net net, it looks like Axon is positioned to have a blockbuster next four years — and AXON stock will power way higher during this stretch.
As police spending significantly increases, Axon’s business momentum will continue accelerating — even without expanded police budgets.
In 2024 alone, Axon has done the following:
- Partnered with LVT, a mobile security solutions provider, to enable retailers, businesses, and law enforcement to share real-time security footage and information. LVT aims to improve threat monitoring and response capabilities in areas that are typically difficult to secure. This is cool because of Axon’s newest AI product – Draft One – which uses AI to take video data and craft police reports, so Axon has clearly developed the AI technology necessary to deliver insights from video data. This partnership creates a new avenue for AXON to commercialize that valuable AI tech.
- Provided the U.S. Marshals Service with its TASER 10 less-lethal energy weapon to help its deputies catch fugitives and keep courtrooms safe. With this new weapon, users can shoot probes farther, which allows them to pause and consider their options before attempting to stop a potentially dangerous person. Additionally, the U.S. Marshals Service is also testing a virtual reality training program.
- Teamed up with Skydio to create an integrated solution for drones in public safety. This system lets agencies send out drones to emergency calls, providing real-time information from a safe distance, speeding up response times, and optimizing resource allocation.
That’s all in just one quarter. Talk about momentum.
With all this momentum at its back, Axon is in a great position to turn a surge in police spending over the next four years into a surge in revenues and profits at the company.
As that happens, AXON stock will power higher.
Axon is largely without competition in this space, having either acquired or smashed every other relevant law enforcement tech company out there. Simultaneously, demand for law enforcement tech is rapidly rising, as every police agency is marching toward ubiquitous uptake of cameras, tasers, and cloud software. That combination gives Axon robust visibility to sustain huge growth over the next few years.
Axon stock has been an overperformer for several years, ever since the company pivoted from selling just tasers, to selling a full stack of law enforcement tech solutions. It will remain an overperformer for the next five-plus years.
We view AXON stock one of the most durable tech growth stories in the market, and believe that durability remains undervalued in shares.
The Final Word
We think this is like 2008 or 2020 … a moment where chaos hides enormous opportunity.
Because the headlines are messy, our strategy is to scale into winners, stay tactical, and follow the policy signals coming out of the Trump administration. After all, the AI revolution is in full swing now, and it’s only going to become more pronounced from here.
Artificial intelligence has been in use for years, but there were no widely applicable solutions until the introduction of ChatGPT. OpenAI’s system completely changed the game, showing the world what AI is capable of. It’s good. It’s really freakin’ good. But regardless of what headlines you may read on X, ChatGPT isn’t gaining sentience and taking over the world. We’re still a long way from having true Artificial General Intelligence (AGI), which is the kind of intelligence you see in the movies.
AGI is the stuff of science fiction. Think Jarvis from Iron Man or HAL 9000 from 2001: A Space Odyssey. Those systems are cool, and they’re what we all think about when we hear “AI.” Naturally, investors get excited when a company says it is building a “God-like” general intelligence system.
But if you hear a firm make that pitch today, run the other way.
Those are startups that will promise the moon but never deliver. They’ll be powered by investor “hopium” until they find themselves in the stock market graveyard next to the failed SPACs of 2021.
Avoid those stocks.
I recommend buying companies that have realistic goals and clear pathways to massive cash flow. Look for the winners developing world-class agentic AI—autonomous systems designed to handle specific, high-value tasks very efficiently. Those are the stocks that will soar thousands of percent over the next few years and establish defensible monopolies in sectors like logistics, healthcare, and finance.
We hope you found this special report useful. Before we go, let us remind you that you’re now also a member of my free Hypergrowth Investing newsletter.
By uncovering early investments in hypergrowth industries, we put you on the ground floor of world-changing megatrends. Keep an eye on your email inbox for my next Hypergrowth Investing article soon. I typically send them every day of the week. In the meantime, you can check out our website by clicking here.
