Ignore the Noise: 3 AI Stocks Set to Surge 200% by the End of the Decade

Picking individual stocks gives investors a shot at beating the market, and while there are plenty of promising options, the highest returns lately have come from companies connected to the artificial intelligence (AI) trend. For instance, the VanEck Semiconductor ETF has more than tripled over the past five years, largely due to its portfolio's focus on AI chipmakers.

AI-related ETFs can perform quite well, but if you pick well from among individual AI stocks, your results could be even more substantial. For instance, Nvidia is up by more than 1,300% over the past five years.

To get similar results from here, investors would be well advised to look at some smaller companies, as it takes less growth on a dollar basis for them to multiply their revenues and profits. In my view, these three stocks certainly have potential.

Axcelis Technologies is pivoting to AI

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Axcelis Technologies (NASDAQ: ACLS) makes ion implantation systems that are critical machinery in fabricating semiconductors. This technology applies to AI chips, but is also used in making chips that are used heavily in electric vehicles (EVs).

From 2021 to 2023, when demand for EVs was surging, the stock was a big winner, but when demand for those vehicles waned, Axcelis' share price took a hit.

Revenue and net income have both been dropping year over year in recent quarters, but in its third-quarter report, management emphasized that high demand for AI chips would be a tailwind for the company. If it can gain market share as a supplier to the AI chipmaking industry, it may return to growth.

Axcelis is also merging with Veeco Instruments, which will expand its addressable market and give it a stronger position as a semiconductor equipment maker. That deal is expected to close in the second half of 2026.

Weak investor sentiment has left Axcelis trading at a reasonable 22 P/E ratio. If the company returns to high growth rates as investors saw from 2021 to 2023, that valuation will look like a steal.

Bitfarms is an AI infrastructure stock that hasn't gotten noticed yet

IREN and Cipher Mining are two of the top cryptocurrency miners that have pivoted to offering AI infrastructure. However, several smaller players like Bitfarms (NASDAQ: BITF) have delivered impressive growth while remaining largely unnoticed.

Bitfarms is building AI data centers that can provide the necessary energy and infrastructure for tech companies. The recent sale of its Paraguay site freed up capital and resources that will fuel its expansion in North America, where it has a 2.1 gigawatt project pipeline.

Those projects won't impact financial results right away, but they set the stage for the company to ink lucrative multiyear contracts. Bitfarms still has a market cap below $2 billion, while IREN and Cipher Mining have market caps of $13 billion and $7 billion, respectively.

Those other two AI infrastructure leaders have already signed deals with big tech companies. However, as more of Bitfarms' pipeline gets energized, the market cap gap between it and its peers should narrow.

Western Digital addresses the memory problem

Before smartphones, people took pictures with digital cameras that had far more limited memory. Once you used up all of that memory, you couldn't take any more pictures until you swapped in a new memory card. Having more memory space lets people take pictures more easily. While few people use standalone digital cameras and SD cards anymore, this concept still applies to AI chips.

Each AI chip relies on high bandwidth memory because AI workloads require substantial data to be accessed rapidly. Without enough of that memory installed nearby, AI chips can't handle the workloads of tools like ChatGPT.

Western Digital (NASDAQ: WDC) is a key data storage provider that offers memory solutions for AI infrastructure. Supply of such chips is another key bottleneck in the buildout of AI infrastructure, and in part explains how Western Digital delivered 27% year-over-year revenue growth in its fiscal 2026 first quarter. CFO Kris Sennesael said that data center demand would be a key driver of revenue growth in fiscal Q2 and beyond.

Based on the fact that Western Digital's shares have more than quadrupled over the past year, investors have noticed the size of the opportunity ahead of it.

Marc Guberti has positions in Cipher Mining and Iren. The Motley Fool has positions in and recommends Nvidia. The Motley Fool has a disclosure policy.