10 AI Stocks Taking Wall Street by Storm

1.  Microsoft Corporation (NASDAQ:MSFT)

Number of Hedge Fund Holders: 317

Microsoft Corporation (NASDAQ:MSFT) provides AI-powered cloud, productivity, and business solutions, focusing on efficiency, security, and AI advancements. On February 21, analysts from leading investment bank TD Cowen reported in a research note that Microsoft has canceled some leases for US data center capacity.

While the move may imply a shift in the company’s AI strategy, it also raises concerns about whether it’s securing more AI computing capacity than it needs in the long term. TD Cowen analysts led by Michael Elias cited channel checks, i.e. inquiries with supply channel providers, to reveal how the company has voided leases in the US totaling “a couple of hundred megawatts” of capacity.

This is the equivalent of roughly two data centers — canceling agreements with at least a couple of private operators. The firm also reported that channel checks further suggest how Microsoft has pulled back on converting so-called statements of qualifications. These are agreements that usually lead to formal leases. Nevertheless, a company spokesperson has revealed that the company’s plans of investing over $80 billion in AI and cloud capacity this fiscal year remain on track.

“While we may strategically pace or adjust our infrastructure in some areas, we will continue to grow strongly in all regions”.

-Microsoft spokesperson.

While we acknowledge the potential of MSFT as an investment, our conviction lies in the belief that some AI stocks hold greater promise for delivering higher returns and doing so within a shorter timeframe. If you are looking for an AI stock that is more promising than MSFT but that trades at less than 5 times its earnings, check out our report about the cheapest AI stock.

READ NEXT: 20 Best AI Stock To Buy Now and Complete List of All AI Companies Under $2 Billion Market Cap.

Disclosure: None. Insider Monkey focuses on uncovering the best investment ideas of hedge funds and insiders. Please subscribe to our free daily e-newsletter to get the latest investment ideas from hedge funds’ investor letters by entering your email address below.