Four AI Stocks Worth Investing in During August
As of August 2025, the AI sector is looking particularly promising, with four key players – Nvidia, Taiwan Semiconductor Manufacturing Company (TSMC), Alphabet, and ASML – presenting a compelling combination of growth and value.
Nvidia continues to lead the way as the top AI stock. With a dominant position in graphics processing units (GPUs) essential for AI training and inference workloads, Nvidia's revenue has soared from about $27 billion in 2022 to a recent $130 billion. This impressive growth is mirrored in the company's net income, which has risen correspondingly. The expected restoration of Nvidia's China export license could further fuel its growth, reversing earlier setbacks from export restrictions [1][2][3].
Taiwan Semiconductor (TSMC) is another standout, experiencing increased demand for AI chips. As the key manufacturer for AI leaders like Nvidia, TSMC's market share has expanded from 29.4% in early 2024 to 35.3% in Q1 2025, underscoring its growing influence in semiconductor production for AI applications. Analysts view TSMC as a strong buy given its integral role in the AI supply chain [1][4].
Alphabet is considered the cheapest among big tech AI stocks, trading at a price-to-earnings (P/E) ratio near 20, significantly lower than its decade average of around 30. The tech giant's AI-driven growth areas include Google Cloud and autonomous driving via Waymo, both contributing to an estimated 15% annualized earnings growth over the next 3-5 years. This positions Alphabet as a potential bargain with room for valuation multiple expansion [1][4].
ASML is critical for the semiconductor manufacturing ecosystem, thanks to its photolithography machines essential for chip production. Like TSMC, ASML benefits from sustained AI chip demand, reinforcing its growth potential [1][4]. Notably, ASML holds a technological monopoly on extreme ultraviolet (EUV) lithography.
Over 2 billion people have used Google's AI search overviews, bridging the gap between a full generative AI experience and traditional search. Google's AI search overviews have the same monetization potential as a traditional search, adding another layer of appeal to Alphabet's strong growth prospects [1].
In the recent quarter, Google Search's revenue rose 12% year over year, and Alphabet's diluted earnings per share (EPS) increased by 22%. ASML's machines are crucial for laying the microscopic electrical traces on chips, making them indispensable for the semiconductor industry [1].
In summary, these four stocks offer a compelling combination of growth and value in the AI sector for August 2025. Nvidia and TSMC lead in hardware and manufacturing, Alphabet provides diversified AI growth exposure with attractive valuation, and ASML supports the chip production infrastructure [1][4].
- The top AI stock, Nvidia, has seen a remarkable growth from $27 billion in 2022 to a current $130 billion, making it a promising investment opportunity.
- TSMC, the key manufacturer for AI leaders like Nvidia, has experienced increased demand for AI chips and is viewed as a strong buy due to its integral role in the AI supply chain.
- Alphabet, considered the cheapest among big tech AI stocks, offers attractive valuation with an estimated 15% annualized earnings growth over the next 3-5 years, potential opportunities in AI-driven areas like Google Cloud and autonomous driving.
- ASML, critical for the semiconductor manufacturing ecosystem, benefits from sustained AI chip demand due to its technological monopoly on extreme ultraviolet (EUV) lithography, reinforcing its growth potential.
