Prediction: This Could Be the World's Most Valuable Stock in 2026, According to 1 Wall Street Analyst (Hint: Not Nvidia)

There's no denying the impact artificial intelligence (AI) has had on the technology landscape over the past several years. Many of the world's most valuable companies by market cap have unmistakable ties to AI and have profited handsomely from the advent of this technology.

Chief among those has been Nvidia (NASDAQ: NVDA). The company's graphics processing units (GPUs) were originally designed to render lifelike graphics in video games (hence the name), but these chips proved equally adept at providing the computational horsepower needed for AI. Since the dawn of AI roughly three years ago, Nvidia stock has surged, driven by robust demand for its AI-centric GPUs.

However, while Nvidia will likely continue to be a market beater in 2026, one Wall Street analyst is suggesting that Apple (NASDAQ: AAPL) could outperform the chipmaker over the coming year.

Image source: Getty Images.

The AI catalyst

The advent of AI lit a fire under the so-called "Magnificent Seven" stocks, which all have ties to this groundbreaking technology. All the members of the collective have outpaced the broader market over the past three years. Nvidia was the undisputed leader, soaring 975% (as of this writing), while Apple was the laggard of the group, climbing just 95%, compared to a 73% increase for the S&P 500 (SNPINDEX: ^GSPC).

While Apple has been slow to leverage the opportunity of AI, the company is poised to rectify that situation over the coming year, according to Wedbush analyst Dan Ives. The veteran tech analyst recently raised his price target on Apple to a Street-high $350, up from its previous level of $320, while maintaining an "outperform" (buy) rating on the stock. That represents potential upside for investors of 26% compared to the stock's closing price on Monday.

Slow off the blocks

Ives' bullish view is based on two key factors that he believes will send the stock higher heading into 2026. He opines this will "finally" be the year AI "enters the AI revolution" and notes that Apple is beginning to outline a comprehensive AI strategy, as evidenced by the ongoing shake-up of the company's AI leadership. Apple recently hired Amar Subramanya, who has spearheaded AI efforts at both Microsoft and Alphabet's Google DeepMind.

Subramanya spent more than 16 years at Google, leading to his role as the head of engineering for Gemini, Google's flagship AI assistant. He also briefly headed up Microsoft's AI efforts. The veteran AI researcher will now oversee Apple's foundation models, machine learning (ML) research, and AI safety and evaluation.

Apple noted that his "deep expertise in both AI and ML research and in integrating that research into products and features will be important to Apple's ongoing innovation and future Apple Intelligence features."

One of the biggest opportunities for Apple is Siri, the voice assistant on the iPhone. Recent reports suggest the company is nearing a deal with Google to help provide a long-overdue AI overhaul for Siri. If this comes to fruition, it could kick-start Apple's AI ambitions, bringing renewed interest to the iPhone.

Ives believes that integrating AI into Apple's products and services will serve as one catalyst that will boost the stock in the coming year.

Underestimating the iPhone

The iPhone itself is the second catalyst Ives believes is underappreciated. The analyst's channel checks suggest that iPhone 17 sales are tracking well, poised to close out the year with a bang, thanks to the upcoming holiday season -- which is historically Apple's biggest, most lucrative quarter.

Investors are also likely underestimating the importance of the company's massive installed base of 2.4 billion iOS devices -- which includes 1.5 billion iPhones. This captive audience and Apple's renewed AI efforts could drive a profitable surge for the iPhone maker, with the stock gaining between $75 and $100 per share, according to Ives.

Apple for the win?

Ives maintains an outperform (buy) rating and a $210 price target on Nvidia, which would push its market cap to $5.1 trillion if it surpasses that benchmark over the coming year. On the other hand, if Apple stock were to reach Ives' price target of $350 in 2026, its market cap would climb to $5.17 trillion, pushing it just ahead of Nvidia.

Seasoned investors know that price targets -- like predicting what the stock market will do next -- is a fool's errand (small "f"), and the only thing we know for sure is that the future is uncertain.

That said, given Apple's track record of defying the odds, I wouldn't put it past the iPhone maker to retake the haughty crown of market cap supremacy. And at 33 times forward earnings, it's cheaper than Nvidia's forward multiple of 39.

Danny Vena, CPA has positions in Alphabet, Apple, Microsoft, and Nvidia. The Motley Fool has positions in and recommends Alphabet, Apple, Microsoft, and Nvidia. The Motley Fool recommends the following options: long January 2026 $395 calls on Microsoft and short January 2026 $405 calls on Microsoft. The Motley Fool has a disclosure policy.