Artificial intelligence (AI) is by no means a new technology. The term was first coined in 1950 by mathematician and computer scientist Alan Turing. Since then, generative technology has appeared in one form or another for decades. However, advances in technology have only recently enabled companies to turn the true concept of AI into reality.

The launch of OpenAI’s ChatGPT in November 2022 breathed new life into the industry and forced many to rethink what they thought was currently possible with AI. As a result, interest has skyrocketed as companies from across the technology space have rushed to get in on the action from the start. Nasdaq-Composite The index has risen 68% since the beginning of 2023, largely due to enthusiasm for AI.

However, macroeconomic concerns have led to a market pullback over the past month, sending the index down about 4%. However, the recent declines are likely temporary in nature as many tech giants continue to make solid financial gains from their respective AI offerings. Therefore, now could be an excellent time to invest in the market before it’s too late.

So here are two AI stocks to buy after a tech market sell-off.

1. Advanced Micro Devices

Advanced micro devices (AMD 0.72%) The stock has fallen about 1% since the start of 2024, reflecting a difficult start to the year as it faced strong competition NVIDIA and a general pullback from tech investors. However, recent declines have boosted the stock’s value, making it a worthwhile investment for those looking to stick around for the long term.

Data from YCharts.

This chart shows that AMD’s price-to-earnings (P/E) and price-to-sales ratios are below their 12-month averages. The numbers show that AMD is trading at one of its best values ​​in months, making now an excellent time to invest in its AI potential.

Since early last year, AMD has unveiled a number of new AI products in an effort to catch up with market leader Nvidia. On June 3, CEO Lisa Su said of the company’s ambitions: “AI is our top priority and we are at the beginning of an incredibly exciting time.”

During the same keynote at the Computex conference in Taipei, the company unveiled its Ryzen AI 300 series of central processing units (CPUs) for laptops and its Ryzen 9000 CPUs for desktops. AMD also revealed its chip roadmap for data centers, announcing its Instinct MI325X AI accelerators, scheduled to launch in the first quarter of 2024, the MI350 series for 2025, and the MI400 for 2026.

AMD, meanwhile, is already making promising progress in the field of AI, as evidenced by a 115% jump in revenue in its data center segment in the second quarter of 2024. The company has put prominent names on its list of AI chip customers, including Amazon, MicrosoftAnd alphabet (GOOG 0.33%) (GOOGL 0.31%)which strengthen its position in the industry.

AMD is on an exciting growth path, which makes the stock a sure-fire winner after a sell-off.

2. Alphabet

Alphabet stock is up 23% year-over-year, but has fallen 13% in the past month. The company suffered a market downturn that dragged down dozens of technology stocks. Still, Alphabet remains a giant in the industry with a growing role in AI, making its stock an attractive investment.

The tech giant has had a tough job ahead of it, as it has the third-largest market share in cloud computing after Amazon Web Services and Microsoft Azure. But Alphabet has made impressive progress over the past year, adding a number of new AI tools to Google Cloud that have helped it outgrow its rivals in terms of growth.

In the second quarter of 2024, Alphabet reported a 13% year-over-year increase in revenue, driven primarily by a 29% increase in Google Cloud sales. At the same time, Google Cloud’s operating profit nearly tripled, exceeding $1 billion for the first time. By comparison, AWS and Azure revenues both grew 19% year-over-year in the same quarter.

In addition to cloud computing, Alphabet is using its Pixel smartphone brand to expand its position in AI. The company unveiled the Pixel 9 on August 13, debuting a new Gemini-based AI smart assistant. Gemini AI uses Alphabet’s Large Language Model (LLM) to offer Pixel 9 users new generative image, text and voice features. The announcement was made before AppleThe iPhone event in September is also expected to announce a number of new AI features for the 2024 smartphone range.

Data from YCharts.

Alphabet’s stock is trading at a bargain price after a sell-off. The chart above shows that its P/E ratio is significantly lower than Microsoft or Amazon, suggesting that Alphabet is one of the best-valued AI cloud stocks on the market.

Along with impressive growth in AI and a strong brand, Alphabet stock is too good to ignore right now.