"Alphabet ( NASDAQ:GOOG) and Nvidia ( NASDAQ:NVDA) have been two of the best growth stocks to own this year. Both stocks have outperformed the S&P 500 over several years and have multiple AI catalysts that can lead to more gains. However, Alphabet has delivered higher returns than Nvidia over the past year, and that trend is likely to continue. Google's parent company looks like the better AI stock, and there are a few reasons why."
"While Nvidia's exposure to AI is mostly tied to chips, along with the CUDA software that powers those chips, Alphabet can cover more ground. The tech giant is already using AI to enhance Google and YouTube, which has resulted in rising revenue and profits. Alphabet also continues to turn Gemini into a top AI model so it can keep competitors ChatGPT and Grok at a distance."
Alphabet has delivered higher returns than Nvidia over the past year and appears positioned to continue outperforming. Nvidia's strength lies in superior AI chips and CUDA software that power many applications, generating surging revenue as AI spending grows. Alphabet leverages AI across Google, YouTube, Gemini, Google Cloud, and Waymo, develops its own AI chips, and can integrate chips into autonomous vehicles and humanoid-robot software. Meta is considering orders of Alphabet chips. Competition among AI chipmakers — including AMD, Broadcom, and OpenAI partnerships — could create pricing pressure for Nvidia over time.
Read at 24/7 Wall St.
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