2 Growth Stocks to Invest $1,000 in Right Now

If you've got $1,000 that you're looking to invest in the current market, I'd recommend sticking with companies that are market leaders. Two such growth stocks that I see as good buys today are Alphabet (NASDAQ: GOOGL) (NASDAQ: GOOG) and Taiwan Semiconductor Manufacturing (NYSE: TSM).

Alphabet

Alphabet continues to dominate online search, where its Google unit holds a market share of around 90%. It has created a wide moat around its search business by owning two of the most common ways people access the internet: the Chrome browser and the Android mobile operating system, where Google is the default search engine. Both command market shares of about 70% in their respective spaces. Meanwhile, Alphabet has a search revenue-sharing deal with Apple that makes Google the default search engine on its devices, helping it capture much of the rest of the market.

While artificial intelligence (AI) chatbots like OpenAI's ChatGPT have brought a new form of competition to Google Search, this competition has actually brought out the best in Alphabet. The company has developed one of the best foundational AI models, Gemini, which it trained using its custom Tensor Processing Unit (TPU) chips. By using its own chips, which cost significantly less than Nvidia's graphics processing units (GPUs), the company has gained a structural cost advantage over competitors in the AI sector. Meanwhile, the new AI features that it has embedded into Google search have been helping to accelerate that unit's growth.

At the same time, Alphabet's cloud computing business has been red-hot, with revenue growth climbing 48% year over year last quarter. The company's TPUs also give it a cost edge here, and Alphabet is set to ramp up its spending on AI infrastructure this year to push its advantage. As the company with the most complete AI stack, Alphabet is one of the best AI stocks to own over the long haul.

Image source: Getty Images.

Taiwan Semiconductor Manufacturing

Taiwan Semiconductor Manufacturing is the largest chip foundry in the world, and it has a near monopoly on manufacturing the most advanced chips. Making advanced chips with few defects requires a lot of technical expertise, and TSMC has proven to be the only company able to achieve high yields at scale.

This has made the company an invaluable part of the semiconductor value chain and an important partner to the world's leading chip designers. It has also given it strong pricing power, which has helped push up its gross margins.

With the AI infrastructure market booming, TSMC is ramping up its spending to build out more fabs in order to increase production capacity in a bid to meet surging chip demand. Between its increasing capacity and increasing prices, TSMC is a stock to own for the long term.

Geoffrey Seiler has positions in Alphabet. The Motley Fool has positions in and recommends Alphabet, Apple, Nvidia, and Taiwan Semiconductor Manufacturing. The Motley Fool has a disclosure policy.