Top Five AI Stocks I'm Buying Now
These notes were generated by AI and may contain inaccuracies.
Markets up higher in 2025 driven by artificial intelligence. S&P 500 up 13%, QQQ up 17%. Outlining five AI stocks that will continue to win over the next 5 years.
OpenAI announced deal with Broadcom. Co-founder on CNBC emphasized demand and growth needs. Tom Lee bullish on Nvidia, compares valuation to Walmart and Costco. This comparison is flawed. Former Intel CEO believes AI bubble exists. Howard Marks says frenzy not a bubble yet. Fail of the week: Individual on X advised risking all in 20s, lost $3.4 million.
Google has low downside, high upside. Up 32% past 3 months, 27% YTD. Still best option today. Trades at 23 forward P/E, meaningfully lower than intrinsic value. Assets: Google Search growing double digits, advanced with AI Overviews, Google AI mode as powerful as OpenAI. Low churn to competitors like ChatGPT. Google Cloud second fastest growing cloud, integrated with Gemini, DeepMind. Subscriptions (Google One, YouTube Premium) $44 billion revenue. YouTube ads growing 12-13%/year, revenue 70% higher or double in 5 years, worth $1 trillion market cap alone. Add DeepMind, Gemini, Google Search—worth far more than current price. $100 undervalued. Buy below $340. Owns $87,000 in passive income portfolio, $52,000 in story fund.
Amazon at $220, low-hanging fruit despite anchoring bias. Deserves more exposure than earlier this year—bigger, stronger, investing aggressively. Downside protection. Revenue growing 11% YoY. High-margin segments grow faster: AWS (4+ million customers) compounding 20+% long-term, growth to accelerate next year. AI leader via Anthropic deal. Massive retail, ads, third-party sellers, logistics, humanoid robots, Prime Video (second biggest streaming), 300 million Prime subscribers (low churn), AI in sports. Cheapest valuation in history. Buy under $300.
ASML at 29 forward P/E, great year. Earnings October 15 before market open. Watch: China export restrictions, geopolitical tariffs, macro uncertainties. CEO commentary caused 10% sell-off last quarter. Predictable revenue: install-base management and services growing >20% in 2025. Every ASML machine still in operation, needs servicing—grows with new sales. Compounding >15% over 5 years. Buy under $1,000, expect positive returns, but volatile post-earnings (drops 10-15% possible).
Owns $140,000 ($85,000 gains). Rare company—don't sell winners. Netflix is AI company via leverage: uses AI powerfully across use cases (content production, enhancing storytelling, not replacing writers/actors). AI search for recommendations, autodubbing, cataloging, retention analysis, watch time, ROI. Tech-focused media company at largest scale. Valuation 40 P/E, but EPS growth 50+% past couple years, >31% past 5 years. Predictable: diverse revenue, unstoppable lead, 15% revenue growth, margins up, $8.5 billion TTM free cash flow. Management targets $1 trillion market cap: double revenue, triple profits, +100 million subscribers, fast ad growth. Weak bear case: high P/E ignores growth. Content: Squid Game, Wednesday, Demon Hunters hits; Stranger Things finale (1.5-2 hour episodes, $50-60 million/episode budget), released late November, Christmas, December 31. Owns holiday season. $8/month plan best value. Geographically diverse, pricing power, boycott-resistant.
Controversial pick. Keep open mind—dismissals as "just an app" ignore Meta (Facebook, Instagram apps), Google (mobile app traffic). Duolingo started app-first for virality. Not unique? Top OpenAI API customer (leaked report, unconfirmed but not denied). Like Spotify wrapping Universal Music Group content—Duolingo controls user experience, flexible to switch models (Gemini, Anthropic). Leverages AI most among customers. 75 P/E, but EPS +73% YoY (from deep red in 2022 to $25 EPS). Subscription revenue +47% YoY, paid subscribers +30%. Recurring revenue. Higher risk, sized accordingly. Buy under $400.
Broadcom up 10% on OpenAI multi-billion dollar partnership for 10 gigawatts custom AI accelerators. Deja vu—similar to deals with AMD, Nvidia. OpenAI co-founder on CNBC:
We need way more compute power... build chips customized for specific workloads... combine knowledge of AI models with silicon implementation. Broadcom in right places after amazing 5 years.
Former CEO of Intel states we're clearly in an AI bubble. Broadcom and OpenAI are excited about AI moves.
Of course we are. We're hyped. We're accelerating. We're putting enormous leverage into the system. That said, I don't see it ending for several years. Businesses are yet to materially benefit from it. We're displacing all of the internet and service provider industries. We have a long way to go.
He agrees with Jensen on industry shift to AI, expects bubble to continue for couple years.
Howard Marks: Valuations are high but not crazy; investors show discretion, not quite a bubble.
Tom Lee: Stay optimistic on US; JP Morgan investing $1.5 trillion into US advantages, especially AI dominance and blockchain tailwind on Wall Street.
Nvidia trades at around 27 times forward earnings. Still cheaper than Walmart (47x) and Costco (34x) forward earnings.
Tom Lee and others compare Nvidia to Costco and Walmart to argue not a bubble.
Costco has superior predictability, reliability, durability, visibility into earnings.
Nvidia revenue growth highly unpredictable:
- Could not predict 10x revenue from 2020.
- Could not predict 7x revenue from 2022.
Costco revenue grows steadily, compounded for decades, no disruptive tech spurts. Investors pay for visibility.
If unable to predict Nvidia growth 5 years ago, why confident in next 5 years?
- Competitors like AMD taking share?
- Hyperscalers replacing Nvidia spend with own TPUs or custom chips?
Costco sells low-margin beef, chicken, milk, eggs—predictable, long-lasting. Nvidia sells Blackwell chips, biggest GPUs—more likely disrupted over 20 years.
LeBrain on X advises 18-20s: Risk it all—only years to lose everything with minor consequences (family, home, food later unaffordable).
His story:
- Deposited all money into memecoins, lost it.
- Took $9,000 student loan, traded to $30,000, lost all, left with $70.
- Turned $70 to $1,000, $10,000, $100,000, kept growing.
Even if I lost everything, I would still have a bed, home, food, family, friends.
Recent update (last Friday, Trump tariff tweet crypto sell-off): Leveraged crypto positions wiped out.
Spent three years 24/7, sacrificed friends, family, health, sweat, blood, tears. In seconds, everything gone. Nothing to show, never get time back.
P&L: -$3,482,717 (~$3.5 million) in one day.
Contradicts his advice—no optimism left, lost health, friends, family, time.
Critique: Degenerate behavior—leveraging to gamble, skip line, get rich fast without work/patience/discipline. Starts optimistic, ends in tears, losing hundreds of thousands to millions in minutes.
Truth: No need to risk at all, ever. Even young, money matters most—compounding works with time.
Invest excess 20s earnings in index funds or growth funds safely, predictably into fortunes with discipline/patience.
Get-rich-quick gambling leads to loss. LeBrain is fail of the week.
That'll be it for this episode.
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