3 No-Brainer AI Stocks to Buy in July

The year is halfway over, and artificial intelligence (AI) hasn't gone anywhere

Companies are sticking to their plan to spend a record amount on data centers, which are primarily used to power the ever-growing AI workloads

These stocks aren't new; they've been top AI stocks to buy for several years now

As a result, I believe these three are excellent stocks to consider purchasing right now

Image source: Getty Images

Nvidia Nvidia's graphics cessing units (GPUs) have trained and powered the vast majority of AI models to this point for a reason

Nvidia also envisions a future of AI factories filled with its GPUs, which means there is still a huge upside in the stock, despite it already being one of the most successful stocks of the past decade

Despite its success, the stock isn't that expensive

It trades at 37 times forward earnings, but for most of the second half of last year, it traded at around 45 times forward earnings

This means there could still be quite a bit of juice left to squeeze out of Nvidia's stock over the next few months

NVDA PE Ratio (Forward) data by YCharts Nvidia is not only a solid buy now, but also an excellent long-term investment

Broadcom One company that's coming for Nvidia's market- dominance is Broadcom

While it offers connectivity switches that are critical for data centers that integrate with Nvidia GPUs, Broadcom is also a partner in designing custom AI accelerators, which it calls XPUs

XPUs can outperform GPUs when the task is set up perly, as they are specifically designed to handle a particular workload

Furthermore, using a chip designed in collaboration with Broadcom eliminates Nvidia and its substantial margins, making the price of using these devices more affordable than an Nvidia GPU

Broadcom already has significant contracts to duce units Google's Tensor cessing Units (TPUs)

As more companies start to deploy AI and build up their inference capacity, Broadcom's XPUs could become a significant part of that solution, potentially driving growth in this portion of its

Taiwan Semiconductor Manufacturing Neither Broadcom nor Nvidia has the capability to fabricate its own chips, so they outsource that work to the worldwide leader in chip duction: Taiwan Semiconductor

Known as TSMC, the company has industry-leading nology and best-in-class yields, making it a great partner, which is why nearly every major company sources its chips from TSMC

With companies Nvidia touting that its highest-end Blackwell chips will be completely made in the U

By the end of the year, the fear surrounding TSMC's ximity to China is diminished

Management also has unparalleled access to industry trends because chip orders are often placed years in advance

That's impressive growth for multiple years, making TSMC a top stock to buy now and hold for the long term

Keithen Drury has positions in Broadcom, Nvidia, and Taiwan Semiconductor Manufacturing

The Motley Fool has positions in and recommends Nvidia and Taiwan Semiconductor Manufacturing

The Motley Fool recommends Broadcom

The Motley Fool has a disclosure policy.