The S&P 500 has dipped in recent weeks, but the major benchmark still is heading for a third consecutive annual increase, with each gain in the double digits. This is at least partially thanks to investor optimism about the future of artificial intelligence (AI). Investors have rushed to get in on companies developing AI products and services, and companies using AI to improve their operations.

Some of these companies already have seen revenue soar thanks to their AI investments, and investors have benefited. And the latest messages from these companies, delivered as part of their earnings reports, suggest the momentum is set to continue. Analysts’ forecasts support this, as they predict today’s multi-billion-dollar AI market is on pace to reach more than $2 trillion by early next decade.

One thing, however, has hurt AI stocks in recent times, and that’s concern about valuations. Many have surged to sky-high levels as investors look for the next AI success story. Considering this, you might wonder if it’s too late to get in on this high-growth industry. But I have some good news for you: Some of the industry’s best players still trade at reasonable levels.

So, if you have $50,000 — or even less — to invest over the long term and are looking for growth, consider the following three tech giants. If your portfolio already is well diversified, you could spread most of this fresh investment across these players — but if you could use some additional diversification, you might put 30% to 50% of the cash into these players and apply the rest to quality stocks in other industries, such as healthcare or consumer goods.

Image source: Getty Images.

1. Nvidia

Nvidia (NVDA 1.06%) is the leading designer of AI chips, key products that are at the heart of the AI boom. This is because they power important processes like the training of AI models, for example, or the model’s “thinking” process used to solve problems. So, Nvidia’s chips — or graphics processing units (GPUs) — are used throughout the entire AI story.

All of this has resulted in explosive revenue growth for Nvidia in recent years — and this continued into the third quarter, with Nvidia reporting double-digit growth to a record of $57 billion. The company’s comments on the strength of demand suggest significant growth will continue, and its commitment to annually updating its chips should cement its position as market leader.

Nvidia

Today’s Change

(-1.06%) $-1.91

Current Price

$178.73

All of this makes Nvidia a buy at 40x forward earnings estimates — and a stock to hold onto for many years.

2. Meta Platforms

Meta Platforms (META +0.87%) has made investing in AI its focus over the past couple of years, and this investment could be a game changer for the company. Today, Meta makes most of its revenue through advertising across its social media platforms. The company already is using AI to transform and improve advertising — a move that should prompt advertisers to keep coming back and spend more.

The AI investment, which also is improving Meta’s social media apps, may encourage users to spend more time there — and that, too, should result in advertising growth.

Meta Platforms

Today’s Change

(0.87%) $5.15

Current Price

$594.30

On top of all of this, Meta offers investors a long track record of earnings growth and even a dividend payment. And today, as the cheapest of the Magnificent Seven tech stocks, trading at 22x forward earnings estimates, Meta is a bargain buy.

3. Amazon

Amazon (AMZN +1.51%) is a fantastic AI bet because the company already is benefiting from AI as a user of the technology and a seller of AI products and services to customers. The company’s e-commerce business relies on AI to help it organize fulfillment center operations and design the fastest delivery routes for packages, for example. These moves lower costs — and favor higher earnings.

Amazon

Today’s Change

(1.51%) $3.28

Current Price

$220.42

Amazon also is winning in AI through its Amazon Web Services (AWS) unit. This cloud computing business offers a wide variety of AI tools to its customers, and this has helped the unit reach an annualized revenue run rate of $132 billion. Since AWS is the world’s biggest cloud service provider, it’s well-positioned to attract AI customers — and has the financial strength to build out infrastructure to meet their needs.

Right now, trading for about 31x forward earnings estimates, Amazon looks like a steal considering its long-term AI prospects.