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History Says the Nasdaq Will Soar: 2 Artificial Intelligence (AI) Stocks to Buy Now, According to Wall Street | The Motley Fool

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  Published in Stocks and Investing on Thursday, September 18th 2025 at 6:23 GMT by The Motley Fool
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Nasdaq’s AI‑Fueled Rally: Two Stocks Worth Watching

A new piece from The Motley Fool predicts that the Nasdaq will “soar” in the coming year as artificial intelligence (AI) takes deeper root in the technology landscape. The article argues that AI is no longer a niche buzzword; it’s a structural force that will reshape nearly every sector. As the Nasdaq’s composition is heavily weighted toward tech names, the author contends that the exchange is set for a significant upswing. Central to the narrative is a recommendation of two AI‑centric stocks that investors can add to their portfolios right now.

Why AI is the engine behind a Nasdaq rally

The article opens with a historical backdrop. In the early 2000s, the dot‑com bubble drove the Nasdaq to dizzying heights before the crash. Fast forward to today, the AI wave mirrors that earlier surge, albeit with a different set of catalysts:

1. Widespread adoption of generative AI tools – From chatbots to code assistants, AI is permeating business processes at a pace that rivals the rise of the internet itself.
2. Massive investment in GPU and chip technology – The demand for processing power has never been higher. Companies that design or supply the hardware required for AI workloads are seeing record revenue.
3. Enterprise willingness to digitize – Post‑pandemic, firms are accelerating digital transformation initiatives, turning to AI to cut costs, improve efficiency, and unlock new revenue streams.

The author cites several recent earnings reports that underscore this trend. For instance, a leading chipmaker posted a 60 % increase in revenue from AI‑related sales, while a data‑analytics firm highlighted a new partnership with a global insurer that leverages AI for risk modeling. These real‑world examples reinforce the idea that the AI boom is translating into tangible financial upside.

Two AI stocks that the author believes are prime buying opportunities

In the heart of the piece, the author names two companies that could serve as “cornerstones” of an AI‑focused portfolio. While the article does not present a detailed valuation model, it does provide a concise rationale for each pick.

1. Palantir Technologies (PLTR)

Palantir is portrayed as a “software‑as‑a‑service” juggernaut that has already integrated AI into its core offerings. The article points to:

• Growing government and commercial contracts – Palantir’s platform is being used by defense agencies and large enterprises for predictive analytics and data‑driven decision making.
• New AI‑powered products – The company recently launched an AI enhancement that automates data ingestion and natural‑language query capabilities.
• Revenue diversification – With a mix of long‑term contracts and subscription revenue, Palantir’s earnings are increasingly insulated from market volatility.

The author notes that while Palantir’s stock is already priced for growth, the company’s continued expansion into AI‑heavy domains could create “significant upside” over the next 12‑18 months.

2. C3.ai, Inc. (AI)

C3.ai is highlighted as a pure‑play AI firm whose software is embedded across a wide range of industries, from oil and gas to automotive. The article emphasizes:

• Rapid customer adoption – The firm has recently signed multi‑year agreements with a major global oil producer and a leading automobile manufacturer, both leveraging AI for predictive maintenance.
• Expanding product suite – C3.ai’s platform now includes a low‑code development environment and integrated data‑visualization tools, making AI more accessible to non‑technical users.
• Competitive moat – The author points out that the company’s AI algorithms are proprietary and that its data partnerships give it a head‑start against newer entrants.

Given its aggressive sales pipeline and a track record of hitting revenue forecasts, the article suggests that C3.ai could deliver a “solid” return for investors willing to ride the AI wave.

Broader market context and risk considerations

The piece does not shy away from acknowledging that the AI boom is not a guaranteed path to profit. Key caveats include:

• Valuation risk – The stocks discussed are priced at multiples that exceed historical averages, especially in a low‑interest‑rate environment. If the growth story stalls, downside could be steep.
• Regulatory uncertainty – As governments begin to scrutinize AI’s societal impacts, new regulations could limit the speed at which AI products are deployed.
• Competition – While Palantir and C3.ai currently hold a leading edge, larger incumbents like Microsoft and Amazon are also investing heavily in AI services and could erode market share.

The author frames these risks as “real but manageable” and encourages investors to maintain a diversified portfolio that includes both AI leaders and more traditional growth names.

Additional resources and links

Throughout the article, the author interlinks to other Fool pieces that expand on specific aspects of the AI discussion:

• A guide on “How AI Is Transforming the Cloud” that explains the technology behind cloud‑based AI services.
• A market‑watch article titled “Nasdaq’s AI‑Led Surge: What It Means for Investors” that provides a statistical breakdown of recent index performance.
• A cautionary note on “How to Spot a Bubble in Technology Stocks,” which offers a checklist for investors wary of over‑valuation.

These embedded links help readers dive deeper into the mechanics of AI adoption, the macro‑economic backdrop, and practical investing strategies.

Bottom line

The Motley Fool article presents a bullish case for the Nasdaq, arguing that AI is the underlying engine for next‑generation growth. By spotlighting Palantir Technologies and C3.ai as two AI stocks with strong fundamentals and compelling product pipelines, the piece offers a concrete starting point for investors looking to capitalize on this wave. While the narrative acknowledges the risks inherent in any high‑growth sector, it ultimately frames AI as a structural shift that could yield substantial upside for those who position themselves early.