2 Undervalued AI Stocks Poised for 100%+ Gains in 2026

The global AI revolution is accelerating, but market dynamics are shifting. While the "Magnificent Seven" dominate headlines, investors seeking contrarian opportunities are increasingly turning to undervalued platforms with robust fundamentals and AI-driven growth catalysts. These stocks, often overlooked by mainstream narratives, offer compelling upside potential as the sector matures. Below, we analyze two such candidates-Adobe (ADBE) and Marvell Technology (MRVL)-which exemplify the intersection of innovation, valuation discipline, and long-term strategic positioning.

Adobe (ADBE): AI-Driven Creativity with a 41% Implied Upside

Adobe, a leader in digital experience software, has quietly integrated AI into its core products, transforming tools like Photoshop and Acrobat into intelligent platforms. According to a report, Adobe is positioned for a 41% implied upside in 2026, driven by its ability to monetize AI-enhanced workflows for creative professionals and enterprises.

The company's financials underscore its resilience. Revenue grew 16% year-over-year in Q3 2025, with operating income expanding to $1.2 billion, reflecting strong pricing power and customer retention. Adobe's AI initiatives, such as Firefly for generative design and PDF AI for document automation, are gaining traction, with enterprise adoption accelerating. Analysts note that Adobe's ecosystem-anchored by its Creative Cloud and Experience Cloud-creates a flywheel effect, where AI-driven productivity boosts user engagement and subscription renewals.

What makes Adobe a contrarian pick? Despite its dominance, the stock trades at a price-to-earnings ratio of 35x, significantly lower than peers like Autodesk (ADSK) and Canva (CANVAS). This discount reflects skepticism about AI's near-term impact on creative workflows, a view that may prove short-sighted as generative AI becomes a standard tool for businesses.

Marvell Technology (MRVL): Powering the AI Infrastructure Boom

Marvell Technology, a semiconductor designer, is another undervalued gem in the AI ecosystem. According to market projections, the company's custom AI accelerators, tailored for hyperscalers and cloud providers, position it to benefit from the $900 billion AI accelerator market projected by 2030. A report by Yahoo Finance highlights Marvell's 88% implied upside in 2026, driven by its strategic partnerships with major cloud players and its ability to scale production of high-performance chips.

Marvell's recent performance validates this optimism. In Q2 2025, revenue surged 22% year-over-year to $3.1 billion, with AI-related sales accounting for 40% of total revenue. The company's acquisition of Inphi Corporation in 2024 has strengthened its data center portfolio, enabling it to compete with industry giants like NVIDIA and AMD. Crucially, Marvell's gross margin of 58%-among the highest in the semiconductor sector-demonstrates its pricing power and operational efficiency.

The stock's current valuation appears disconnected from its growth trajectory. At a price-to-sales ratio of 4.5x, Marvell trades at a steep discount to peers like Broadcom (AVGO) and AMD (AMD), which trade at 12x and 10x, respectively. This undervaluation stems from market underestimation of Marvell's role in the AI infrastructure supply chain-a gap that could close rapidly as demand for specialized chips intensifies.

The Contrarian Case for AI Investing

Both Adobe and Marvell exemplify the contrarian AI investing thesis: focusing on platforms with durable competitive advantages, strong cash flows, and underappreciated AI integration. While the market fixates on speculative AI startups, these stocks offer a more grounded path to capital appreciation.

According to Morningstar's 2026 outlook, the firm cautions against overconcentration in AI megacaps, advocating for a diversified approach that includes value stocks and international equities. Adobe and Marvell align with this strategy, combining AI exposure with traditional value metrics such as low price-to-earnings ratios and robust free cash flow generation.

Conclusion

The AI revolution is no longer a distant promise but a present-day reality. For investors willing to look beyond the noise, Adobe and Marvell represent two of the most compelling undervalued opportunities in 2026. Their strong fundamentals, coupled with AI-driven growth catalysts, position them to deliver returns far exceeding the market average. As the sector evolves, these stocks may well become the new darlings of the AI era.