3 AI Stocks That Are Way Cheaper Than Apple Right Now

The article argues Apple trades at 31x forward earnings despite sluggish growth, while Nvidia (22x forward P/E), Microsoft, and Taiwan Semiconductor offer faster growth at lower or comparable valuations. It highlights Nvidia’s projected 79% and 85% growth over the next two quarters, Microsoft’s 17% revenue growth, and TSMC’s targeted 25% CAGR from 2024 to 2029. Overall, the piece is a bullish valuation comparison favoring those three names over Apple.

Analysis

The market is not re-rating megacap tech uniformly; it is increasingly paying up for growth visibility and punishing “good but not great” secular stories. That matters because Apple’s premium multiple now embeds a durability of mid-teens growth that is hard to justify if handset replacement cycles remain stretched and services growth normalizes. The relative mispricing creates a cleaner expression in owners of the AI capex stack, where demand is still being revised up while supply constraints keep pricing power intact.

The deeper second-order winner is TSM, not just NVDA. If AI spending stays elevated, TSM captures revenue from both accelerator demand and advanced packaging bottlenecks, which can keep utilization high even if Nvidia’s mix shifts over time. That makes TSM the better “picks-and-shovels” hedge against any future digestion phase in AI hardware demand, while still participating in the secular buildout.

MSFT is the lowest-drama way to express the same relative-value thesis: it has AI monetization optionality, but the real edge is that its earnings base is diversified enough to absorb valuation compression less violently than Apple. The contrarian miss in the article is that this is less about Apple being a bad company and more about its multiple acting like a bond proxy at the wrong time; if rates re-accelerate or consumer spending softens, Apple’s duration works against it. Near term, the catalyst set favors continued multiple dispersion rather than convergence, unless Apple surprises with evidence that the latest growth inflection is durable for multiple quarters.

Key Decisions for Investors

• Rotate from AAPL into NVDA on a 3-6 month horizon: long NVDA / short AAPL equal-dollar pair. Risk/reward favors the pair if AI capex remains intact; downside is mainly if Apple reaccelerates earnings growth for 2+ quarters and narrows the valuation gap.
• Use MSFT as the lower-beta relative-value long versus AAPL: long MSFT / short AAPL with a 6-12 month hold. This is the cleanest way to express ‘similar quality, cheaper multiple,’ while limiting single-name execution risk in semis.
• Prefer TSM over NVDA for a longer-duration AI infrastructure trade: long TSM with a 12-month horizon. Upside comes from sustained foundry and advanced packaging demand; risk is a slowdown in AI server orders or geopolitical premium expansion.
• If buying directional upside, use call spreads rather than stock in NVDA: 6-9 month call spread to cap premium decay while keeping leverage to earnings revisions. Best entry is on any post-print pullback or broad tech de-risking.
• Avoid initiating fresh AAPL longs until the next two quarters confirm that revenue acceleration is durable; if long already, consider trimming into strength and reallocating toward MSFT/TSM where growth visibility is better and multiple support is stronger.