2 top artificial intelligence stocks to buy in august

Unlock AI's Hidden Value: Two Undervalued Stocks for Smart Investors

As the Artificial Intelligence (AI) sector continues its ascent, savvy investors are looking beyond the obvious high-fliers for sustainable growth. This August, two key players integral to the AI revolution—Micron Technology and Alphabet—stand out. Their current valuations significantly undervalue their immense growth potential and strategic importance in the evolving AI landscape.

Micron Technology: The Undervalued AI Enabler

Micron, a leader in memory chips, operates in a market known for its cycles. However, the sustained AI-driven demand marks a significant, long-term upswing. Despite a 61% gain over the past two years, Micron trades at a mere 9.2 times forward earnings, with an incredibly low PEG ratio of 0.2. This valuation suggests a profound market underestimation of AI's enduring impact on memory demand, creating a clear buying opportunity.

Financially, Micron is robust: sales jumped 58% in two years, and free cash flow impressively shifted from a $4.7 billion deficit to a $1.9 billion surplus. As Nvidia's preferred memory supplier for AI accelerators and a vital component in AI-enabled smartphones, Micron is at the heart of AI infrastructure. These are not fleeting trends but fundamental drivers. For those convinced of AI's multi-year growth trajectory, Micron offers a foundational, undervalued investment.

Alphabet: The Diversified AI Colossus

Alphabet, Google's parent company, has experienced a modest 3% stock gain in 2025, trailing major tech indices and AI peers. Yet, its valuation remains exceptionally attractive; it could effectively double and still compare favorably to many overvalued market leaders. Unlike companies with a narrow focus, Alphabet's AI strategy is broad and resilient, providing inherent risk mitigation.

Alphabet's strength lies in its diversified AI ecosystem, meticulously built for long-term endurance beyond its core search and advertising. Its portfolio spans AI-powered YouTube, cutting-edge autonomous driving with Waymo, the dominant Android mobile platform, and a rapidly expanding Google Cloud integrated with advanced AI tools. Alphabet's consistent innovation across these ventures ensures its relevance for decades. This makes it an exceptionally strong investment, offering broad exposure to AI's future at a compelling discount, proving it's not just a solid, but a smart buy.