2. NICE Ltd. (NASDAQ:NICE)
NICE Ltd. (NASDAQ: NICE) reaches second place as one of the most undervalued enterprise AI stocks in the ranking. The company provides customer-experience software used by organizations to manage contact centers, employee performance, digital conversations and increasingly sophisticated AI agents.
Customer service represents one of the clearest commercial uses of artificial intelligence. Companies receive enormous quantities of repetitive questions, appointment requests, billing inquiries and technical-support concerns. AI systems can handle many of these interactions automatically while directing complicated cases to human employees.
The company’s CXone platform combines cloud communications, analytics, automation and AI-powered customer-service tools. Its acquisition of Cognigy strengthened its position in conversational and agentic AI, allowing enterprises to build virtual agents capable of completing more advanced tasks.
Second-quarter 2026 revenue increased 7.6% to $782.3 million. Management projected full-year revenue of $3.17 billion to $3.19 billion and adjusted earnings of $11.06 to $11.26 per share. Cloud revenue was expected to increase between 13% and 15%. The company ended the quarter with approximately $354.7 million in cash and short-term investments and no outstanding debt.
At a share price near $105.50, the midpoint of the company’s adjusted earnings guidance implies a forward non-GAAP price-to-earnings ratio of approximately 9.5. That is unusually low for a profitable cloud software company with direct exposure to enterprise artificial intelligence.
The low valuation exists for a reason. GAAP operating margin declined from 22.1% to 13.3%, while adjusted operating margin fell from 30.2% to 25.3%. Investors are concerned that higher AI investment and stronger competition will continue pressuring profitability.
Still, the market capitalization of approximately $6.6 billion leaves meaningful room for long-term appreciation. If AI revenue accelerates and margins eventually recover, this could become one of the strongest overlooked AI stock picks in the software sector.
