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AI Sell-Off: Buy ANET, TSM & MU to Make Up for NVIDIA Losses
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Key Takeaways
Arista, Taiwan Semiconductor and Micron offer AI exposure beyond NVIDIA amid market volatility.
AI infrastructure spending reached $121.4 billion in Q2 2026, rising 53.3% year over year.
Strong revenue growth and rising earnings estimates support ANET, TSM and MU.
The artificial intelligence (AI) trade is facing one of its toughest tests yet. After driving Wall Street's rally for much of 2026, technology and semiconductor stocks have come under intense selling pressure as investors question lofty valuations, the sustainability of hyperscaler capital expenditures and the time required to monetize massive AI investments. Rising inflation, higher Treasury yields and uncertainty surrounding data-center construction have added to the pressure.
The weakness is also evident in AI-focused ETFs. Over the past 30 days, the Global X Artificial Intelligence & Technology ETF (AIQ) has declined 11.4%, while the iShares Future AI & Tech ETF (ARTY) has plunged 17.1%, entering correction territory. ARTY's steeper decline indicates the extent of selling pressure across companies positioned to benefit from future AI adoption.
The Nov. 5 sell-off was particularly severe. The iShares Semiconductor ETF (SOXX - Free Report) plunged 12.1%. The pressure escalated on Nov. 8 following a corporate governance controversy involving NVIDIA (NVDA - Free Report) . NVIDIA shares fell 4.27% on Nov. 9 as concerns over leadership continuity, board oversight and potential national-security implications weighed on investor sentiment. The sell-off deepened on Nov. 10, with NVIDIA losing another 6.5% and the Nasdaq Composite declining 1%. Broader concerns over AI infrastructure spending, complications surrounding a major Ohio data-center project and hotter-than-expected inflation further undermined technology stocks.
Image Source: Zacks Investment Research
However, does this correction signal the end of the AI investment opportunity, or is it creating an attractive entry point in fundamentally strong companies? Let's find out.
Here, we have picked three AI stocks — Arista Networks (ANET - Free Report) , Taiwan Semiconductor Manufacturing Company (TSM - Free Report) or TSMC and Micron Technology (MU - Free Report) — all carrying favorable Zacks Rank and having strong fundamentals, making them attractive alternatives to NVIDIA for investors seeking AI exposure beyond the market leader amid the current volatility.
Why Quality AI Stocks Beyond NVIDIA Are Attractive Now
Despite the correction, long-term AI infrastructure demand remains strong. According to IDC's Nov. 6 report, global AI infrastructure spending reached $121.4 billion in the second quarter, up 53.3% year over year. IDC raised its 2026 spending forecast to $521 billion from $497 billion previously and expects the market to reach $1.17 trillion by 2029.
Meanwhile, J.P. Morgan projected AI capital expenditure of approximately $900 billion in 2026, although financing, electricity availability and semiconductor supply remain constraints.
This spending creates opportunities beyond NVIDIA across AI networking, advanced semiconductor manufacturing, high-bandwidth memory and computing processors. Investors should focus on companies translating AI demand into measurable revenue growth and stronger earnings rather than speculative AI exposure.
3 Quality AI Stocks to Consider
Arista: It is benefiting from increasing demand for high-speed Ethernet networking in AI data centers. Its third-quarter 2026 revenues surged 58.5% year over year, while non-GAAP EPS increased to $1.20 from 77 cents a year earlier. Non-GAAP operating margin reached 49.1%. Management expects fourth-quarter revenues of $3.9-$4 billion. ANET's networking exposure makes it an attractive means to participate in AI infrastructure expansion beyond chip manufacturing.
The Zacks Consensus Estimate for 2026 earnings indicates growth of 45.6% on current-year sales growth of 47.9%. Over the past seven days, 2026 earnings estimates for ANET have been revised upward by 4.3% to $4.36 per share. The stock sports a Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.
Image Source: Zacks Investment Research
Taiwan Semiconductor: TSMC's advanced manufacturing capabilities make it indispensable to the AI semiconductor ecosystem. Its October 2026 revenues jumped 59.7% year over year. Its January-October 2026 revenues increased 43.3% to NT$4.49 trillion. TSMC offers exposure to AI demand across multiple chip designers, rather than relying on a single GPU manufacturer.
The Zacks Consensus Estimate for 2026 earnings suggests 63.9% growth, while sales are expected to increase 40.9%. Over the past seven days, 2026 earnings estimates for TSM have been revised upward by 2.3% to $17.46 per share. The stock sports a Zacks Rank #1.
Image Source: Zacks Investment Research
Micron: The AI expansion is increasing demand for high-bandwidth memory (HBM) and advanced DRAM, positioning Micron favorably. The company reported strong fiscal fourth quarter 2026 revenues of $54.23 billion, compared with $11.32 billion a year earlier. Micron has also commenced high-volume shipments of HBM4.
The consensus estimate for fiscal 2027 earnings suggests growth of 133.1%. Sales are expected to surge 110%. Over the past 60 days, fiscal 2027 earnings estimates for MU have been revised upward by 11.5% to $176.04 per share. The stock carries a Zacks Rank #2 (Buy).
View the Zacks #1 Rank List
Image: Bigstock
AI Sell-Off: Buy ANET, TSM & MU to Make Up for NVIDIA Losses
Key Takeaways
The artificial intelligence (AI) trade is facing one of its toughest tests yet. After driving Wall Street's rally for much of 2026, technology and semiconductor stocks have come under intense selling pressure as investors question lofty valuations, the sustainability of hyperscaler capital expenditures and the time required to monetize massive AI investments. Rising inflation, higher Treasury yields and uncertainty surrounding data-center construction have added to the pressure.
The weakness is also evident in AI-focused ETFs. Over the past 30 days, the Global X Artificial Intelligence & Technology ETF (AIQ) has declined 11.4%, while the iShares Future AI & Tech ETF (ARTY) has plunged 17.1%, entering correction territory. ARTY's steeper decline indicates the extent of selling pressure across companies positioned to benefit from future AI adoption.
The Nov. 5 sell-off was particularly severe. The iShares Semiconductor ETF (SOXX - Free Report) plunged 12.1%. The pressure escalated on Nov. 8 following a corporate governance controversy involving NVIDIA (NVDA - Free Report) . NVIDIA shares fell 4.27% on Nov. 9 as concerns over leadership continuity, board oversight and potential national-security implications weighed on investor sentiment. The sell-off deepened on Nov. 10, with NVIDIA losing another 6.5% and the Nasdaq Composite declining 1%. Broader concerns over AI infrastructure spending, complications surrounding a major Ohio data-center project and hotter-than-expected inflation further undermined technology stocks.
Image Source: Zacks Investment Research
However, does this correction signal the end of the AI investment opportunity, or is it creating an attractive entry point in fundamentally strong companies? Let's find out.
Here, we have picked three AI stocks — Arista Networks (ANET - Free Report) , Taiwan Semiconductor Manufacturing Company (TSM - Free Report) or TSMC and Micron Technology (MU - Free Report) — all carrying favorable Zacks Rank and having strong fundamentals, making them attractive alternatives to NVIDIA for investors seeking AI exposure beyond the market leader amid the current volatility.
Why Quality AI Stocks Beyond NVIDIA Are Attractive Now
Despite the correction, long-term AI infrastructure demand remains strong. According to IDC's Nov. 6 report, global AI infrastructure spending reached $121.4 billion in the second quarter, up 53.3% year over year. IDC raised its 2026 spending forecast to $521 billion from $497 billion previously and expects the market to reach $1.17 trillion by 2029.
Notably, non-accelerated, CPU-based infrastructure spending grew 61.1%, outpacing the 52.2% growth in accelerated systems, highlighting expanding investment opportunities beyond GPU suppliers.
Meanwhile, J.P. Morgan projected AI capital expenditure of approximately $900 billion in 2026, although financing, electricity availability and semiconductor supply remain constraints.
This spending creates opportunities beyond NVIDIA across AI networking, advanced semiconductor manufacturing, high-bandwidth memory and computing processors. Investors should focus on companies translating AI demand into measurable revenue growth and stronger earnings rather than speculative AI exposure.
3 Quality AI Stocks to Consider
Arista: It is benefiting from increasing demand for high-speed Ethernet networking in AI data centers. Its third-quarter 2026 revenues surged 58.5% year over year, while non-GAAP EPS increased to $1.20 from 77 cents a year earlier. Non-GAAP operating margin reached 49.1%. Management expects fourth-quarter revenues of $3.9-$4 billion. ANET's networking exposure makes it an attractive means to participate in AI infrastructure expansion beyond chip manufacturing.
The Zacks Consensus Estimate for 2026 earnings indicates growth of 45.6% on current-year sales growth of 47.9%. Over the past seven days, 2026 earnings estimates for ANET have been revised upward by 4.3% to $4.36 per share. The stock sports a Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.
Image Source: Zacks Investment Research
Taiwan Semiconductor: TSMC's advanced manufacturing capabilities make it indispensable to the AI semiconductor ecosystem. Its October 2026 revenues jumped 59.7% year over year. Its January-October 2026 revenues increased 43.3% to NT$4.49 trillion. TSMC offers exposure to AI demand across multiple chip designers, rather than relying on a single GPU manufacturer.
The Zacks Consensus Estimate for 2026 earnings suggests 63.9% growth, while sales are expected to increase 40.9%. Over the past seven days, 2026 earnings estimates for TSM have been revised upward by 2.3% to $17.46 per share. The stock sports a Zacks Rank #1.
Image Source: Zacks Investment Research
Micron: The AI expansion is increasing demand for high-bandwidth memory (HBM) and advanced DRAM, positioning Micron favorably. The company reported strong fiscal fourth quarter 2026 revenues of $54.23 billion, compared with $11.32 billion a year earlier. Micron has also commenced high-volume shipments of HBM4.
The consensus estimate for fiscal 2027 earnings suggests growth of 133.1%. Sales are expected to surge 110%. Over the past 60 days, fiscal 2027 earnings estimates for MU have been revised upward by 11.5% to $176.04 per share. The stock carries a Zacks Rank #2 (Buy).
Image Source: Zacks Investment Research