Prediction: Artificial Intelligence (AI) Stocks Will Lead the Nasdaq to New Highs. Here Are the 3 Best to Buy Now.

The Nasdaq Composite is at all-time high levels after its recent rally. It has had an impressive run, considering that it was over 10% down from its most recent high entering April. However, I don't think the Nasdaq is going to stop at all-time high levels and stay dormant; I think there will be a substantial rally coming over the next few months.

This will be led by artificial intelligence (AI) stocks, which have been lackluster performers over the past few months. In particular, I think Nvidia (NASDAQ: NVDA), Broadcom (NASDAQ: AVGO), and Amazon (NASDAQ: AMZN) will be some of the leaders, and their stocks look like excellent buys right now.

Image source: Getty Images.

1. Nvidia

Nvidia has been the face of AI investing since the trend kicked off in 2023. There's a good reason for that, too. Nvidia's chips have been the go-to computing units for nearly every AI business since their inception. Although there has recently been increased competition from custom AI chip designers (like Broadcom and Amazon), Nvidia still holds a commanding market share and is delivering incredible growth.

During its latest quarter, Nvidia announced 73% revenue growth. Considering that Nvidia is the world's largest company by market cap, that's downright incredible.

But it's about to get even better. Wall Street analysts project Nvidia's Q1 and Q2 revenue growth will be 79% and 85%. Accelerating revenue growth is great news for Nvidia investors. If they report a strong quarter, as is expected, next month, I think the stock could pop and lead the Nasdaq to new highs, especially because it's fairly cheaply priced.

NVDA PE Ratio (Forward) data by YCharts

At 24.2 times forward earnings, Nvidia's stock is well below where it normally trades, and I don't think it's out of line to expect the stock to rally throughout the end of 2026, which will help lead the Nasdaq to new highs.

2. Broadcom

As mentioned, Broadcom is competing in the same space as Nvidia, but in a different manner. It's partnering with AI hyperscalers to design custom AI chips, which can provide superior performance at a lower price point, but at the cost of workload flexibility. This is a trade-off many are willing to make, and Broadcom is seeing it show up in its results.

During Q1 of its fiscal 2026 (ended Feb. 1), Broadcom's AI semiconductor division (which includes other products outside of its custom AI chip lineup) saw its revenue rise 106% year over year to $8.4 billion.

However, by the end of 2027, CEO Hock Tan believes its custom AI chip division will generate more than $100 billion in sales. That's outstanding revenue growth in a short time frame, and if Broadcom can continue to deliver on that promise, the stock will rally throughout the year.

This makes Broadcom a stock worth owning, and I think investors should buy shares before it rallies even more.

3. Amazon

Amazon may not seem like much of an AI stock, but with Amazon Web Services (AWS), its cloud computing division, generating most of its operating profits, it should be viewed that way. AWS was the first cloud computing firm, but it's still one of the top.

One factor that's attracting several clients to AWS is its custom chips. This part of AWS is experiencing triple-digit revenue growth, similar to Broadcom. Furthermore, Amazon has sold out of capacity for its third-generation Trainum3 chips and nearly sold out of its Trainum4, even though that chip is more than 18 months away from launching.

Amazon is a cloud computing powerhouse, and as the market understands that, its stock will rally as a result, especially if it can report solid growth throughout 2026. I think Amazon is a dark horse to be one of the best-performing Nasdaq stocks, and investors should position themselves accordingly.

Keithen Drury has positions in Amazon, Broadcom, and Nvidia. The Motley Fool has positions in and recommends Amazon, Broadcom, and Nvidia. The Motley Fool has a disclosure policy.