The Ultimate Growth Stock to Buy With $1,000 Right Now

Does your portfolio need some new growth names, but you're leery of adding the market's most obvious and overcrowded trades? If so, you're not alone. Most of the market's most popular picks are still overbought and overvalued. You'd be better served with something a bit off the beaten path.

Consider adding a stake in Nokia (NYSE: NOK) sooner rather than later. Holding out for a pullback from its recently reached multiyear high might help a little. But being unwilling to step in even at this frothy valuation could just as easily be a mistake.

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Opportunity ahead for Nokia

You likely know Nokia as the Finnish company that used to be a mobile phone powerhouse. The advent of several different smartphone players mostly displaced its branded handhelds, although its technology is still found within plenty of mobile devices. It also supplies a range of cellular connectivity equipment to mobile phone network operators while also providing wireless connectivity hardware to data centers, corporate campuses, connected factories, and more.

None of it, however, is especially exciting growth-driving stuff. Last year's sales were only up 2% year over year. Now look at the future. Nokia is positioned for explosive growth. And it's got everything to do with the advent of artificial intelligence (AI).

But first things first.

You likely understand that AI not only requires a great deal of digital data but also produces just as much actionable information.

The growing problem? Receiving and sending this data, particularly when it must be done with wireless connections (cars, autonomous robots, remote sensors, etc.). The current fifth-generation (5G) networks in use today aren't capable of handling the looming swell of all this digital data. It's going to take something newer and better, like 6G connectivity.

Nokia has, of course, been working on next-generation wireless networking for as long as the current generation of solutions has been the norm. However, so have its rivals.

The company scored a major win in October when artificial intelligence titan Nvidia announced a partnership with Nokia to co-develop a radio access networking platform that will be powered by the AI needed to make this tech capable of handling the oncoming storm of digital data that Nvidia is largely helping create.

And the opportunity is sizable to be sure. Although there's still a few years' worth of developmental work to be done, Precedence Research suggests that the worldwide AI-powered 6G wireless connectivity market is set to grow at an average annualized pace of nearly 29% through 2035. Nokia is readying to capture at least its fair share of this growth.

Buckle up for what could be a bumpy Nokia ride

This won't be an easy stock to own for the foreseeable future, for the record. It's already uncomfortably expensive at around 60 times its trailing per-share profits, and its 6G connectivity efforts won't start bearing any real fruit for a few years. Shares are sure to be volatile in the meantime.

Nokia is undeniably preparing to serve a business that's going to become critically important, though, as well as just big. In addition to the next-generation hardware that will be needed by the proliferation of AI solutions, Finland's telco-tech giant will be able to monetize services that rely on its next-gen equipment.

Just buckle up for a bumpy ride. It will be worth it in the long run.

James Brumley has no position in any of the stocks mentioned. The Motley Fool has positions in and recommends Nvidia. The Motley Fool has a disclosure policy.