Key Points

Dell, primarily recognized as a PC maker, is surging ahead in AI platforms.
AI demands ways to capture real-world data and act on it physically. ON Semiconductor delivers tools for both ends.
Astera Labs addresses connectivity hurdles that AI data center builders overlooked at first.

Names like Nvidia and Palantir Technologies are household words in AI circles. Nvidia dominates as the top provider of AI data center chips, while Palantir excels in decision-making software. These stocks have delivered impressive gains fueled by AI excitement.

Entering such prominent names carries risks, as they attract heavy investor interest and elevated prices. Warren Buffett's wisdom rings true: avoid chasing the popular. Nvidia and Palantir bucked this trend even after gaining fame, but many investors now view their strongest growth periods as behind them. Astute market watchers hunt for emerging AI opportunities still flying under the radar.

Consider these three lesser-known AI stocks to acquire ahead of broader recognition: Dell (NYSE: DELL), ON Semiconductor (NASDAQ: ON), and Astera Labs (NASDAQ: ALAB). Here's the rationale.

Dell Immerses Itself in AI Solutions

Dell remains a powerhouse in desktops and laptops while advancing boldly into AI via its Dell AI Factory platform.

At its core, Dell AI Factory simplifies AI deployment and usage for businesses, leveraging Dell hardware - often combined with Nvidia chips. Teams like Formula 1's McLaren, energy firm Worley, and retailer Lowe's have turned complex AI concepts into practical results.

The strategy pays off. Revenue climbed 19% to a record $113.5 billion last year, powered by 40% expansion in infrastructure solutions, especially AI servers. Forecasts point to similar revenue and profit advances this year. Dell's ready-to-use packages appeal to firms avoiding custom AI builds.

Proceed with caution, though. Though not yet a mainstream AI pick, investor enthusiasm has lifted shares of this $160 billion firm 30% beyond the average analyst target of $191.21.

Recent surges may outpace analyst updates. Patient buyers could find Dell among the market's prime AI underdogs.

ON Semiconductor Enables AI-Driven Automation

Building a robust AI system is step one; applying it meaningfully is next. AI requires converting real-world inputs to data and executing physical outputs.

ON Semiconductor fills this role discreetly.

ON produces industrial sensors, wireless antennas, microcontrollers, power managers, advanced chips, and motor controls for uses from driver aids and medical devices to factories and wearables. Partners include EV firms Geely and Nio, plus China's Sineng Electric for energy storage. It collaborates with Nvidia on 800-volt power tech to boost next-gen AI data center efficiency.

Growth remains steady rather than explosive; double-digit sales increases mark strong years. Acceleration looms as AI automation spreads to manufacturing, vehicles, health care, and urban systems, bolstered by ON's comprehensive lineup.

ON delivers reliable profits, with occasional dips tied to one-offs like recent restructuring costs. This stability sets it apart from rivals such as Navitas and Wolfspeed.

Astera Labs Speeds Up AI Data Center Performance

Astera Labs rounds out this trio of overlooked AI prospects for 2026.

Early AI data centers relied on standard parts: Nvidia GPUs, Cisco networking, Micron memory. This sufficed initially, but exploding data volumes soon overwhelmed them. Operators sought affordable upgrades blending old and new gear.

Astera Labs stepped up.

Astera crafts full interconnect systems for AI data centers' vast processor arrays. Its Aries retimers and cables handle ultra-fast signals; Scorpio switches maximize bandwidth; Leo controllers enhance legacy memory; Taurus cards upgrade networking. Supporting software optimizes the lot. Hyperscalers like Microsoft and Amazon count among its clients.

Momentum builds. Latest quarter revenue hit $308.4 million, up 14% sequentially and 93% annually. Projections call for sustained sales gains fueling sharp profit rises. Astera eyes nearly $3 per share in 2026, climbing to $4.33 in 2027.

Valued at 45 times next year's earnings, it seems reasonable given prospects. Global Market Insights forecasts 13.4% annual growth for Astera's data center infrastructure market through 2034.