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Nvidia Stock Is Still Undervalued. So Are These 2 Smaller AI Plays.

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Nvidia is the clear—and most obvious—beneficiary from the AI buildout but there are two other companies that are less well known to investors that should equally benefit in the year ahead.

A flurry of recent bad news from the world of semiconductors has been a rare blemish during an otherwise stellar stretch for the economy—and for stocks. 

At the end of October, two major chip suppliers said they saw weakness in auto demand for the first time, with On Semiconductor blaming the softness on higher interest rates for car loans. Texas Instruments provided disappointing guidance, saying the industrial sector was particularly soft. 

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For a shrinking set of bears, those warnings are an indication that the economy isn’t on as strong a footing as many now think. Meanwhile, with the S&P 500 index now 5% away from an all-time high, stock-picking could become trickier in the months ahead. 

But even if the global economy does sputter next year, there may be one technology area that looks relatively insulated: the chips and products required to build out the data centers that serve the soaring demand for artificial intelligence.

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