Key Takeaways
- Nvidia is poised for a potential earnings‑driven surge in late August, trading at a modest forward P/E of 24× despite strong AI‑related demand.
- Micron’s memory‑chip price boom is benefiting AI infrastructure build‑out, and management expects tight supply to persist beyond 2027, supporting further upside.
- Amazon Web Services (AWS) continues to explode on AI workloads, with Q2 revenue up 37% and operating income up 64%, fueling a long‑term vision of a $1 trillion annual run‑rate.
- The Motley Fool Stock Advisor still recommends Nvidia, Micron and Amazon as top AI‑focused buys, noting historical outperformance versus the S&P 500.
- Investors should weigh near‑term volatility against the structural growth drivers of AI hardware, memory, and cloud services when considering these stocks.
August AI Investment Landscape Shifts
August has just begun, but the events in late July and early August have already reshaped the artificial‑intelligence investing arena. “Several winners and losers have appeared, and even though earnings season isn’t over yet, there are plenty of stocks worth considering right now,” the original piece notes. Amid a flurry of hyperscaler capex upgrades and competitor earnings surprises, three names repeatedly surface as attractive AI plays: Nvidia (NASDAQ: NVDA), Micron (NASDAQ: MU) and Amazon (NASDAQ: AMZN). Each company occupies a distinct link in the AI value chain—chip design, memory supply, and cloud‑compute execution—making them complementary bets on the continued build‑out of AI infrastructure.
Nvidia’s Upcoming Fiscal Q2 Report
Nvidia hasn’t been the Nvidia most people remember in 2026. For the previous three years it was a market‑darling, yet this year its share price has risen only around 17%, barely edging out the S&P 500. The real catalyst looms at the end of August, when Nvidia reports its fiscal second‑quarter results. Analysts point to several indications that the quarter could be a blowout: “Many AI hyperscalers have raised spending guidance, and one of Nvidia’s chief competitors, AMD, reported a blowout quarter.” Unlike AMD, Nvidia’s valuation remains relatively modest heading into earnings, with a forward P/E of roughly 24×. “You’ll be hard‑pressed to find a stock growing as fast at that cheap of a price,” the article argues, suggesting the stock is primed to “skyrocket late in August following earnings.” If the guidance beats expectations, the stock could reclaim its reputation as a high‑growth AI leader.
Micron’s Memory Chip Boom and Sustainability
Micron is enjoying a standout 2026, with its stock more than tripling year‑to‑date. The surge stems from its core business—memory chips—which have become a critical bottleneck in the AI build‑out. When supply tightens and demand spikes, prices soar, directly boosting Micron’s earnings and profitability. Yet the market remains wary, fearing that the current price boom may be fleeting. Micron’s management counters that skepticism, noting that “it will be mid‑2027 before more production capacity is available,” and therefore “they believe the tightness in the memory chip market will persist beyond 2027.” This outlook leaves ample room for elevated prices and sustained profit growth. Consequently, the article recommends buying Micron on any dip, anticipating that the market will eventually re‑recognize the stock as a major winner in the AI supply chain.
Amazon’s AWS Growth Driven by AI Spend
Amazon is feeling the pressure of higher memory‑chip costs, prompting it to lift its 2026 capital‑expenditure guidance from $200 billion to $220 billion. Despite the added expense, the company is still generating a strong return on its AI investments, most visibly through Amazon Web Services (AWS). In Q2, “AWS revenue exploded 37% higher, with operating income rising 64%,” far exceeding analyst expectations. Over the trailing twelve months, AWS has produced nearly $150 billion in revenue, and CEO Andy Jassy envisions a future where the segment could achieve a $1 trillion annual run‑rate. While that milestone will take time to reach, the current trajectory underscores that Amazon’s AI‑fueled cloud expansion remains a compelling growth engine, making the stock a solid hold for investors bullish on the AI build‑out.
Investment Considerations and Motley Fool Perspective
Before pulling the trigger on Nvidia, the article advises readers to consider the broader context provided by the Motley Fool Stock Advisor. The service’s analyst team recently highlighted ten stocks they believe are poised for monster returns, and Nvidia did not make that particular list. The piece recalls past successes: “Consider when Netflix made this list on December 17, 2004… if you invested $1,000 at the time of our recommendation, you’d have $399,724! Or when Nvidia made this list on April 15, 2005… if you invested $1,000 at the time of our recommendation, you’d have $1,374,595!” It also notes that Stock Advisor’s total average return stands at 967%, dwarfing the 215% average return of the S&P 500. Despite the current omission, the Motley Fool still holds positions in and recommends Advanced Micro Devices, Amazon, Micron Technology, and Nvidia, underscoring a continued belief in their long‑term AI potential. As always, the article includes the standard disclosure that the author holds positions in Amazon and Nvidia, and readers should perform their own due diligence before investing.
https://www.theglobeandmail.com/investing/markets/stocks/MU/pressreleases/3744586/3-artificial-intelligence-ai-stocks-to-load-up-on-in-august/