The AI race between Anthropic, OpenAI, Meta and Google is speeding up, and Nvidia’s planned US$12.9b bid for Hugging Face shows how valuable the underlying platforms have become. That mix of heavy spending, possible mega IPOs and rising regulation risk is reshaping where money flows. This article walks through three stocks exposed to this news to help you decide which deserve closer attention now.
The stocks covered below are only a sample of the opportunities tied to this AI and cloud shift, and the full screen surfaced 41 more large cap platforms with equally compelling stories that are not detailed in this article. To identify and analyze the highest conviction ideas straight away, head to the AI Platform and Cloud Leaders screener.
Commvault Systems (CVLT)
Commvault Systems is a data protection and cyber resiliency specialist that sits behind the AI race, securing the cloud infrastructure and data pipelines where models are trained and run. Its business is highly focused, with about US$1.2b in revenue coming from software and programming tools that back up, secure, and recover enterprise workloads across on premises and multi cloud environments. The company has a market cap of about US$5.7b, which puts it firmly in the large cap bracket for this AI Platform and Cloud Leaders screen.
Investors looking at the AI build out often focus on chips or model providers and may overlook companies like Commvault Systems that aim to secure the growing pool of AI training data and cloud workloads. Management is leaning into this with Commvault Cloud, deeper Azure integration, and moves into AI data security such as the planned Satori Cyber acquisition. Together, these initiatives could help support higher quality recurring revenue over time. The flip side is that the stock already trades on a rich earnings multiple, margins are under pressure, and results can be lumpy, so execution on SaaS growth and AI focused products is particularly important.
Commvault Systems is pivoting hard into AI security, yet the real story lies in how its cash generation, margins and valuation compare with that ambition. Get the full picture in the DCF valuation analysis for Commvault Systems
Rambus (RMBS)
Rambus is a semiconductor company that supplies high performance memory interface chips and security IP that help keep AI data centers, cloud platforms and advanced computing systems running efficiently. The business currently reports about US$756 million in revenue from semiconductors, reflecting its focus on DDR5 and DDR4 memory interface products and related silicon IP for moving and protecting data. With a market cap of roughly US$9.3b, Rambus fits this AI Platform and Cloud Leaders screen as a sizeable, established enabler of the underlying infrastructure.
Rambus may be worth a closer look if you want exposure to the AI build out without owning a chip giant or cloud platform directly. Its DDR5 and high speed interface products are used inside data center servers that power AI training and inference, and management commentary points to design win activity in HBM, GDDR and PCIe IP. At the same time, the stock has clear tension points such as reliance on a few high margin memory product lines, insider selling in recent months and a valuation that already reflects ambitious growth expectations. A key consideration is whether its mix of IP licensing, companion chips and AI focused memory solutions can ultimately support that level of optimism.
Rambus’s AI memory story is accelerating, but the real puzzle is whether its rich expectations match the underlying fundamentals and IP mix. Get the full picture in the 3 key rewards and 1 important warning sign
Procore Technologies (PCOR)
Procore Technologies runs a cloud-based construction management platform that acts as a central hub for project data and workflows, which is exactly the kind of SaaS foundation the AI Platform and Cloud Leaders screen is looking for. The company generates about US$1.4b in revenue from internet software and services, largely by helping contractors, owners and architects manage preconstruction, project execution, resources and financials in one system. With a market cap of roughly US$8.8b, Procore Technologies is a sizeable player in digitising and increasingly automating the construction industry.
Investors who want AI exposure beyond Big Tech should pay attention to Procore Technologies. Its construction cloud is already a system of record and collaboration for project data, and management is now layering on Procore AI and agent based tools that can help with estimating, scheduling and portfolio decisions in ways traditional software cannot. The company is still loss making and leans on external funding, while recent insider selling raises fair questions about near term expectations. Yet improving earnings forecasts, product launches tied directly to AI ready data such as Asset Register, and a growing global footprint indicate that the long term balance between risks and potential rewards here may differ from what the recent share price implies.
Procore Technologies looks like its AI construction cloud story is still underestimated, especially with US$1.4b in SaaS style revenue already in place. Get the context behind that growth and the key risk in the analyst forecasts for Procore Technologies
Seeking Alternatives Beyond These AI Leaders
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This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.
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