In the world of artificial intelligence, few investments have delivered better returns than chip stocks in recent years. Nvidia, AMD, and Broadcom are three companies that stand out as leaders in the AI realm. They’re all fabless chip companies, designing chips but outsourcing their manufacturing, which leads to asset-light businesses with fantastic margins. Nvidia is the market leader, with its graphics processing units (GPUs) still the go-to computing units for training and running artificial intelligence models. Soaring demand for its chips has allowed it to rapidly grow into the world’s largest company by market cap, with impressive margins to boot.
## The Three AI Chip Stocks to Watch in 2026
Nvidia is the market leader, and its dominance is unlikely to change anytime soon. Its current chip architecture, Blackwell, is still an impressive offering, and its upcoming Rubin chip architecture promises to be a significant step up. However, AMD is working hard to close the gap. While its GPUs are less pricey alternatives to Nvidia’s, their performance specs are solid, and downloads of its ROCm software increased tenfold year over year in November 2025. This indicates that its chips are being explored more widely as viable alternatives to Nvidia’s.
Broadcom, on the other hand, is taking a different approach to AI computing. Instead of designing general-purpose parallel processors, it partners directly with AI hyperscalers to design bespoke computing units optimized for specific workloads. These custom AI accelerator chips can deliver superior processing speeds at lower costs. However, Broadcom’s growth rate is slower than that of Nvidia, which could limit its upside potential.
## The Cheapest and Fastest-Growing Stock: Nvidia vs. Broadcom
Each of these companies operates on a different fiscal calendar, which makes comparing their projections for 2026 inexact. However, the exercise still offers useful results. Nvidia trades at 24 times its expected earnings for fiscal 2027, which is lower than Broadcom’s 31 times. Wall Street also expects Nvidia to deliver blistering fast growth, with an average analyst predicting 52% growth in fiscal 2027.
In the battle of AMD versus Nvidia, Nvidia makes the most sense to buy because it’s cheaper and growing more quickly. Broadcom is the wild card, with its ASICs taking the AI world by storm. However, its growth rate is slower than that of Nvidia, and it’s slightly more expensive. For its fiscal 2026, analysts expect 52% growth, the same as Nvidia’s. However, if Broadcom’s growth rate turns out to be higher than expected due to rising demand for its custom chips, its stock could outpace Nvidia’s this year.
## Should You Buy Stock in Broadcom Right Now?
Before investing in Broadcom, consider its growth rate and valuation. While it’s not the cheapest stock, its custom AI accelerator chips are taking the AI world by storm. If its growth rate turns out to be higher than expected, its stock could outpace Nvidia’s this year. However, investors would be better off to have both Nvidia and Broadcom in their portfolios, as I do.
The Motley Fool Stock Advisor analyst team has identified the 10 best stocks for investors to buy now, and Broadcom wasn’t one of them. However, Broadcom’s custom AI accelerator chips are taking the AI world by storm, and its growth rate could outpace Nvidia’s this year. If you’re considering investing in Broadcom, it’s essential to weigh its growth rate and valuation against its competitors. With the right approach, Broadcom could be a lucrative addition to your portfolio.
In the world of AI, few companies have delivered better returns than Nvidia, AMD, and Broadcom in recent years. Each of these companies has its strengths and weaknesses, and investors must carefully consider their growth rate, valuation, and approach to AI computing before making a decision. With the right approach, any of these companies could be a lucrative addition to your portfolio. However, Nvidia’s dominance in the market and its impressive growth rate make it the most attractive option for investors in 2026.
