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Best Risk-Adjusted AI Portfolio for 2026: NVIDIA & Palantir

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Key Takeaways

  • Investors look to 2026's AI boom by combining NVIDIA and Palantir for a balanced approach.
  • NVDA posted surging Q3 revenues driven by demand for Blackwell chips and sold-out cloud GPUs.
  • PLTR grew commercial and government revenues sharply as adoption of its AI Platform lifted results.

As we approach 2026, investors might be wondering how to capitalize on the next artificial intelligence (AI) boom. The best strategy is to invest in both NVIDIA Corporation (NVDA - Free Report) and Palantir Technologies Inc. (PLTR - Free Report) , which provide a balanced AI investment. Let’s examine this in detail –  

Reasons to Be Bullish on NVIDIA 

Lately, Wall Street grappled with concerns that the AI boom might be drifting into bubble territory. However, NVIDIA’s latest impressive quarterly results effectively dispelled those fears. NVIDIA posted revenues of $57 billion in the fiscal third-quarter 2026, a massive 62% year-over-year surge and a 22% increase quarter-over-quarter, citing investor.nvidia.com.

The most sought-after data center segment saw revenues surge 66% year over year to $51.2 billion, while gaming revenues rose 30% to $4.3 billion. Incessant demand for the new generation Blackwell chips boosted data center revenues, and cloud graphics processing units (GPUs) were totally sold out for the quarter, added Jensen Huang, NVIDIA’s CEO. 

What’s more, management believes that NVIDIA’s competitive edge in the AI hardware market, along with sustained demand for its CUDA software platform, will drive further growth. As a result, NVIDIA expects revenues for the fiscal fourth quarter of 2026 to reach $65 billion, with a 2% margin of error.  

Anyhow, NVIDIA appears to be financially strong, having returned $37 billion to its shareholders through cash dividends and share buybacks in the first nine months of fiscal 2026. The company also reported a high net income of $31.91 billion in the fiscal third-quarter 2026, up from $19.31 billion a year earlier.

Reasons to Be Bullish on Palantir 

Palantir, in recent times, has successfully expanded its U.S. commercial footprint while retaining government contracts, fueled by the ever-growing adoption of its Artificial Intelligence Platform (AIP). As a result, revenues from the U.S. commercial segment came in at $397 million for the third quarter, up 121% year over year and 29% quarter over quarter. Government revenues totaled $486 million, up 52% year over year and 14% sequentially, citing  investors.palantir.com.

Overall, Palantir’s revenues reached $1.18 billion in the third quarter, up 63% year over year and 18% quarter over quarter, and it has easily beaten Wall Street projections. CEO Alex Karp further noted that the GAAP net income for the quarter was an impressive $476 million, which is almost half a billion dollars in only three months. 

Management remains optimistic about Palantir’s future growth, banking on several large AI enterprise contracts. Consequently, Palantir expects revenues for the full year to be between $4.396 billion and $4.400 billion, while for the fourth quarter to be between $1.327 billion and $1.331 billion. 

2026’s Best Risk-Adjusted AI Bet: NVIDIA & Palantir 

NVIDIA’s latest quarterly results underscore its robust financial strength and dominant position in the AI market, paving the way for further growth. Similarly, Palantir’s expansion across both commercial and government segments, driven by its AI platform adoption, reinforces confidence in the company’s growth prospects. 

However, skeptics may highlight Palantir’s high valuation, with a forward price-to-earnings (P/E) ratio of 230.7, significantly higher than the Internet-Software industry's average of 38.06. This increases the risk of a sharp price drop if there is a broader market correction.  

Zacks Investment Research

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But holding NVIDIA alongside Palantir can help mitigate this risk since the company is a large, profitable, and dominant player in the AI market, trading at a more reasonable forward P/E of 38.94, below the Semiconductor - General industry’s average of 43.02. 

Zacks Investment Research

Image Source: Zacks Investment Research

Therefore, investors may choose to invest in both NVIDIA for its stability and Palantir for its potential high-growth upside. NVIDIA has a Zacks Rank #1 (Strong Buy), and Palantir has a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks Rank #1 stocks here.


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