Bargain AI and Tech Stocks for 2026 and Beyond: Undervalued Growth Opportunities in the AI Infrastructure and Software Ecosystem

The AI sector's explosive growth in 2025 created both winners and losers, with memory chips, storage solutions, and cloud infrastructure emerging as critical battlegrounds. While stocks like Micron Technology (MU) and SanDisk (SNDK) surged on AI-driven demand, others, including Oracle (ORCL) and Adobe (ADBE), faltered due to execution risks and valuation concerns according to Morningstar analysis. As we enter 2026, the focus for investors shifts to identifying undervalued opportunities within the AI ecosystem-companies poised to benefit from long-term trends but currently trading at attractive valuations relative to their growth potential.

AI Infrastructure: The Unsung Heroes of the AI Boom

The backbone of AI innovation lies in infrastructure, where analog chips, semiconductor manufacturing tools, and energy solutions play pivotal roles. Texas Instruments (TXN), a leader in analog and embedded processing, has quietly positioned itself as a pure play on AI infrastructure. In Q2 2025, TXN reported a 16% year-over-year revenue increase, driven by surging demand for its chips in data centers and AI hardware. With $6.4 billion in trailing 12-month operating cash flow and a projected 10.1% EPS growth for 2026, the stock trades at a forward P/E of 18.5x, significantly below its five-year average.

Applied Materials (AMAT), a key supplier of semiconductor manufacturing equipment, also stands out. Despite a 3% quarterly revenue decline in Q4 2025, AMAT's full-year revenue hit $28.37 billion, with non-GAAP EPS rising 9% year over year. The company's exposure to advanced packaging and DRAM technologies-critical for AI chips-positions it to benefit from the sector's long-term tailwinds. At a forward P/E of 12.3x, AMAT trades at a discount to peers like Lam Research and KLA, making it a compelling value play.

AI Software and Services: Beyond the Hype

While hardware remains foundational, AI software and services are increasingly driving monetization. Palantir Technologies (PLTR), which saw a 135% stock gain in 2025, has deepened its commercial footprint with AI-centric platforms for data analytics and decision-making. However, its valuation has outpaced fundamentals, prompting skepticism. A better bet may lie in Alphabet (GOOG), which trades at a forward P/E of 27.9x despite its dominant position in AI. Alphabet's Gemini models and AI-optimized TPUs are enhancing monetization in advertising and cloud services, with a $155 billion cloud backlog and 70% of customers already using AI tools.

Energy and Power: The Overlooked Bottleneck

As AI data centers consume more energy, power infrastructure is becoming a critical growth area. New Fortress Energy and Nano Nuclear Energy are two under-the-radar plays addressing this need. New Fortress Energy provides modular LNG infrastructure and on-site generation, offering scalable solutions for data centers. Nano Nuclear Energy, though early-stage, is developing microreactors that could provide carbon-free baseload power for AI facilities in the future. Meanwhile, CoreWeave and Jabil are capitalizing on the AI server boom, with CoreWeave's GPU-powered data centers operating at near-full capacity and Jabil's integrated systems reducing deployment costs.

High-Growth AI Software Stocks: The Next Wave

Smaller but high-potential AI software stocks include Nebius (NBIS), spun off from Yandex, and SoundHound AI (SOUN). Nebius has already sold out its data center capacity, projecting an $8–$9 billion annual run rate by 2026. SoundHound's generative AI and audio recognition platforms drove a 68% revenue jump in its latest quarter, highlighting its versatility in enterprise and consumer markets.

Conclusion: Balancing Valuation and Execution

The AI sector's volatility underscores the importance of balancing valuation with execution quality. While companies like Micron and Nvidia (NVDA) dominate headlines, undervalued plays such as Texas Instruments, Applied Materials, and Alphabet offer more attractive risk-reward profiles. Investors should also consider the energy infrastructure layer, where companies like New Fortress Energy and Jabil are quietly building the rails for AI's next phase. As AI transitions from hype to hypergrowth, the winners will be those with durable moats, scalable infrastructure, and disciplined capital allocation.