Should You Forget Palantir and Buy These 2 Millionaire-Maker Stocks Instead?

Palantir Technologies (NASDAQ: PLTR) has been one of the hottest stocks on the market in the past couple of years, rising an incredible 1,000% as of this writing and beating the S&P 500 index's gains of just 45% during this period by a heavy margin.

The software specialist's stunning rally can be attributed to the terrific demand for its Artificial Intelligence Platform (AIP), which enables customers to embed generative AI capabilities into their operations. The demand for Palantir's AIP has been so strong that the company's growth accelerated impressively in 2024.

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Even better, Palantir's impressive growth seems here to stay as the increasing size of the company's contracts, the rapid improvement in its customer base, and the expansion of its business at existing customers should ensure healthy top- and bottom-line growth for a long time.

However, there is one big problem with Palantir right now: the valuation. The stock has gotten ahead of itself as it is now trading at a whopping 72 times sales and 443 times earnings.

Though Palantir may be able to justify its expensive valuation in the long run thanks to the huge opportunity in the generative AI software market, it may be a good idea for investors to look at other options that are trading at attractive valuations and have the potential to make them richer.

Let's take a closer look at two other names that are way cheaper than Palantir and could fit into a diversified selection of stocks for investors looking to construct a million-dollar portfolio.

1. Nvidia

Semiconductor giant Nvidia (NASDAQ: NVDA) has made investors millionaires in the past. For instance, a $5,000 investment made in Nvidia a decade ago is now worth just over a million dollars. Of course, expecting Nvidia to replicate such remarkable gains over the next decade isn't logical considering that it now has a market cap of just under $3 trillion, but it could still deliver robust gains and seems a worthy candidate for a million-dollar portfolio.

NVDA data by YCharts

That's because Nvidia has several solid growth drivers that could pave the way for remarkable growth in revenue and earnings in the long run. From AI to gaming to automotive to digital twins, Nvidia can rely on multiple billion-dollar end markets to sustain its impressive growth.

Starting with AI, the company's dominant position in the market for data center graphics cards and its growing influence in the enterprise software market has the potential to add billions of dollars to its revenue. The semiconductor bellwether reported a record $115 billion in data center revenue in the recently concluded fiscal year 2025, which was a 142% increase over the prior year.

Considering that demand for chips deployed in high-performance computing (HPC), data centers, and AI servers could hit $581 billion in 2035, Nvidia still has a lot of room for growth in this market. Importantly, Nvidia controls the lion's share of the AI chip market, which saw total data center GPU sales of $125 billion last year.

Nvidia's key competitors have been unable to make much of a dent in AI chips. Of course, there is a rising threat from the likes of Broadcom, which makes custom AI processors. But investors should note that GPUs are the chip of choice when it comes to accelerating AI workloads in a data center, with an estimated market share of 60% of the overall AI accelerator market in 2024.

At the same time, Nvidia's focus on selling complete AI server systems equipped with multiple chips that include both GPUs and CPUs could help the company maintain its impressive share of this huge end market. That's because an integrated system will enable customers to process workloads faster while reducing energy costs.

Not surprisingly, the demand for the company's latest generation of Blackwell systems has ramped up at an incredible pace, and Nvidia sold $11 billion of these chips in the previous quarter. That was more than double AMD's total data center GPU revenue in 2024.

On the other hand, Nvidia continues to maintain its dominance in the gaming GPU market with a share of 90%. This space is expected to generate a whopping $145 billion in revenue in 2035, suggesting that Nvidia's gaming revenue could increase substantially from the previous fiscal year's level of $11 billion.

Throw in other potentially lucrative opportunities such as digital twins and the sharp spike that's expected in the automotive business, and it can be concluded that Nvidia is built for impressive long-term growth.

What's more, Nvidia trades at just 27 times forward earnings, a massive discount to Palantir's forward earnings multiple of 145. This makes buying Nvidia a no-brainer right now. It could easily fit into a potentially multibillion-dollar portfolio thanks to its attractive valuation and massive growth opportunities.

2. C3.ai

Enterprise AI software provider C3.ai (NYSE: AI) has dropped significantly on the stock market since going public in December 2020, losing 76% of its value as of this writing, but it could turn out to be a terrific long-term bet. Like Palantir, C3.ai offers generative AI applications and a development platform that can integrate AI into businesses.

The company's growth started picking up in the past couple of years.

AI Revenue (TTM) data by YCharts

C3.ai's offerings have been gaining traction not just among commercial customers, but among government establishments as well. This was evident from management's comments on the company's February earnings conference call. C3.ai's generative AI solutions are available on major cloud computing platforms, leading to strong growth in the adoption of its software.

For instance, C3.ai witnessed a healthy 72% year-over-year increase in the number of agreements it struck in the third quarter of fiscal 2025 (which ended on Jan. 31). The company reported a 26% increase in quarterly revenue to $99 million, and there is a good chance that it will be able to deliver stronger growth in the future thanks the number of agreements it has been striking.

Moreover, C3.ai points out that several of its customers -- both commercial and government -- are entering into "new and expanded agreements," suggesting that it is also winning more business from its existing client base. As such, it is easy to see why analysts have raised their revenue expectations of C3.ai for the next couple of fiscal years.

AI Revenue Estimates for Current Fiscal Year data by YCharts

The company's fiscal 2025 guidance suggests that its top line could jump around 25% to $389 million at the midpoint. However, stronger growth cannot be ruled out over the next couple of fiscal years as C3.ai believes that it can step on the gas by winning a bigger share of the massive AI software market.

Investors should note that the global AI software market is expected to jump fourfold between 2023 and 2030, generating $391 billion in annual revenue by the end of the decade.

C3.ai, therefore, could sustain impressive growth in its top and bottom lines for a long time to come. Given that C3.ai is currently trading at just over 7 times sales, it is 10 times cheaper than Palantir in price-to-sales ratio. Now looks like a good time to buy C3.ai stock as its ability to deliver solid growth in the long run, along with its attractive valuation, make it another good fit for investors looking to construct a million-dollar portfolio.

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John Mackey, former CEO of Whole Foods Market, an Amazon subsidiary, is a member of The Motley Fool's board of directors. Harsh Chauhan has no position in any of the stocks mentioned. The Motley Fool has positions in and recommends Advanced Micro Devices, Amazon, Microsoft, Nvidia, and Palantir Technologies. The Motley Fool recommends Broadcom and C3.ai and recommends the following options: long January 2026 $395 calls on Microsoft and short January 2026 $405 calls on Microsoft. The Motley Fool has a disclosure policy.