Adobe (ADBE) and Broadcom (AVGO) highlighted as AI stock picks

Long-term Treasury yields have climbed to a 19-year high, pulling attention back to bonds, but the article frames the real story around what is driving those yields higher: a historic surge in AI investment that keeps corporate borrowing strong even as money gets more expensive. That combination can punish stretched companies and reward strong ones.

Against that backdrop, an undervalued-stock screen has surfaced Adobe (ADBE) and Broadcom (AVGO) as AI-driven picks. Adobe is a global software business that powers creative, document, and customer experience workflows, weaving generative AI into Creative Cloud and Experience Cloud. As professionals integrate AI into their daily workflows, their credit usage increases; when they hit the limits of their current plan, they may upgrade to a higher Creative Cloud tier or purchase a credit pack, driving Average Revenue Per User (ARPU) expansion. Broadcom supplies semiconductor solutions such as custom AI data-center chips and networking hardware, alongside infrastructure software, linking it to how AI workloads are built and operated in data centers.

The article notes that a single assumption about how aggressively enterprises pay up for deeper Adobe AI usage could shift in either direction and reshape how investors frame Adobe's risk and upside, so the outcome hinges on those usage assumptions. Broadcom's dual exposure to AI hardware and software may make it a gauge of AI data-center spending, while Adobe's credit-based model could serve as a test of whether professionals convert AI interest into higher-priced plans.