As Artificial Intelligence (AI) continues to transform industries, demand for advanced chips and infrastructure is skyrocketing. Nvidia (NVDA), the current darling of Wall Street, has dominated the AI narrative with its GPUs powering machine learning and data centers. However, NVDA’s high valuation and lack of meaningful dividends prompt investors to explore alternative AI stocks with income potential.
Two under-the-radar AI stocks stand out for their ability to ride the AI wave while offering a rare blend of growth and income: Taiwan Semiconductor Manufacturing (TSM) and Broadcom (AVGO). Both companies have demonstrated significant growth potential, driven by soaring demand for AI chips.
TSM, the world’s leading semiconductor foundry, has reported a 30% year-over-year revenue increase to $90 billion in 2024, driven by accelerating AI chip demand. The company offers a dividend yield of approximately 1.2%, supported by strong cash flows and a shareholder-friendly policy. TSM’s forward P/E ratio is around 21, lower than NVDA’s 29, suggesting substantial room for valuation growth.
Broadcom (AVGO), on the other hand, has experienced a 220% jump in AI-related revenue in 2024, driven by demand for custom silicon and networking solutions from hyperscalers like Google and Meta Platforms. The company carries a premium price-to-earnings ratio of around 33 but offers a robust dividend yield of 1.3%, backed by a decade of consistent dividend increases.
Both TSM and AVGO have the potential to deliver 10x returns over the long term, driven by their unique strengths in AI infrastructure and innovation pipelines. TSM’s unmatched scale and technological leadership position it to capture a significant share of the growing AI chip market, while AVGO’s diversified portfolio and strategic partnerships enhance its competitive edge in the enterprise AI space.
For investors seeking both growth and income, these two under-the-radar AI stocks offer an attractive alternative to NVDA. As the AI landscape continues to evolve, TSM and AVGO are poised to capitalize on the trend, providing a compelling opportunity for those looking to invest in the next generation of AI leaders.
Source: https://247wallst.com/investing/2025/07/13/forget-nvda-these-2-ai-stocks-have-10x-potential-and-pay-dividends