As the artificial intelligence (AI) revolution continues, investors are closely watching semiconductor companies. While Nvidia and Broadcom often dominate headlines, Morgan Stanley analysts are pointing to a surprising pick for 2026: Micron Technology (MU). Here’s what you need to know about these top AI chip stocks.

1. Nvidia: The AI GPU Powerhouse

Nvidia is widely known for its high-performance graphics processing units (GPUs), which are essential for AI training and inference in data centers. But its real edge lies in a full-stack approach combining GPUs, CPUs, networking hardware, and software tools for seamless performance.

Nvidia’s CUDA platform makes it easy for developers to build AI applications, from predictive analytics to autonomous machines. This integration means Nvidia often provides the lowest total cost of ownership (TCO), even if competitors offer cheaper chips.

• Market share: Over 80% in AI accelerators
• Expected earnings growth: 37% per year over the next three years
• Current valuation: About 46 times earnings

Investors see Nvidia as a long-term AI leader, though its stock price already reflects much of that growth.

2. Broadcom: Networking and AI Acceleration Leader

Broadcom plays a crucial role in AI infrastructure, producing high-speed networking chips and custom AI accelerators (ASICs). Its products are used by tech giants like Google, Meta, TikTok, OpenAI, and Anthropic, with potential deals in the pipeline with Apple and xAI.

The company’s VMware subsidiary also dominates virtualization software, helping businesses manage hybrid cloud systems efficiently.

• Networking chip market share: ~80%
• AI accelerator market share: 70–80%
• Projected AI market growth: 29% annually through 2033
• Expected earnings growth: 36% per year for the next three years

Broadcom combines strong hardware dominance with software expertise, making it a solid AI investment, though competition is intensifying.

3. Micron Technology: Morgan Stanley’s Favorite Pick

Unlike Nvidia and Broadcom, Micron focuses on memory and storage solutions, including DRAM and NAND products for PCs, mobile devices, data centers, and automotive systems.

• DRAM: Provides high-speed memory for AI training and inference
• NAND: Offers storage for large AI datasets and models

While Micron isn’t the biggest player, Samsung and SK Hynix lead the market, it’s gaining ground, especially in high-bandwidth memory (HBM) for AI workloads. Over the past year, Micron increased its HBM market share by 10 percentage points.

Morgan Stanley analysts highlight that the AI boom has caused the most severe memory shortage in 30 years, driving prices up. Micron is well-positioned to benefit.

• Expected earnings growth: 48% annually over the next three years
• Current valuation: 28 times earnings

This combination of growth potential and attractive valuation makes Micron a compelling choice for 2026, despite smaller upside compared to Nvidia or Broadcom.

Key Takeaways for Investors

• Nvidia: Dominates AI GPUs, offers end-to-end systems, high growth, but higher valuation
• Broadcom: Strong in networking and AI ASICs, plus software virtualization, solid growth
• Micron: Memory-focused, gaining market share, benefiting from AI-driven shortages, potentially undervalued

Even though Micron is Morgan Stanley’s top pick, investors should note that Wall Street opinions differ widely. Always research multiple perspectives before making investment decisions.

Disclaimer: This article is for informational purposes only and does not constitute financial advice. Investing in stocks involves risks, including the loss of principal. Always consult a qualified financial advisor before making investment decisions.