In this article, we will examine the 10 Best Cloud Stocks To Buy According to Hedge Funds.
Based on a report by MarketsandMarkets, the global cloud industry in 2025 is projected to grow by 15.1% to $1,256.8 billion. While 2024 was marked by high adoption by the BFSI sector, the year ahead should see applications being developed that meet the unique specifications of each industry. North America and Europe should capture the bulk of the market size but APAC is expected to register the fastest growth. The integration of AI with cloud platforms accompanied by new service models is another key development expected to shape this industry.
Cloud ETFs have generated generous returns of 2.74%, 28.54% and 11.00% for 1-month, 6-month and 1-year tenors. One would assume that the underlying stocks would continue to perform well, propelled by strong industrial tailwinds.
READ ALSO 7 Best Stocks to Buy For Long-Term and 8 Cheap Jim Cramer Stocks to Invest In
For this article we picked 10 cloud stocks trending on latest news. With each stock we have mentioned the number of hedge fund investors. Why are we interested in the stocks that hedge funds pile into? The reason is simple: our research has shown that we can outperform the market by imitating the top stock picks of the best hedge funds. Our quarterly newsletter’s strategy selects 14 small-cap and large-cap stocks every quarter and has returned 275% since May 2014, beating its benchmark by 150 percentage points (see more details here).
A technical analyst using a cloud-based analytics dashboard for financial services.
10. Hubspot Inc (NYSE:HUBS)
Number of Hedge Fund Investors: 63
Bank of America considers HubSpot (NYSE:HUBS) as one of the top software picks for 2025, backed up by strong demand for its cloud-based infrastructure from small and medium enterprises. Not only is it leveraging inorganic growth by acquiring AI-based companies like Frame AI, but the partnership with firms offering cloud services is also paying dividends. Firms like Cloud Technology Solutions (CTS) have used the Hubspot platform to transform a large volume of data into meaningful insights and increased leads by 33%.
Revenue has grown 20% y-o-y in Q3-2024 backed up by a 23% y-o-y growth in the number of customers. The scalability and adaptability to different systems across its cloud interface is what makes the product versatile and customer-friendly. In its latest earning call, there was a clear focus on embedding innovative AI technology across its entire platform. It showcased more than 200 new innovations in its latest annual conference, INBOUND, most of which come at a reasonable cost due to availability on the cloud. The guidance for next quarter is strong and may exceed expectations if it goes on improvising its product to attract new clients.
9. Snowflake Inc (NYSE:SNOW)
Number of Hedge Fund Investors: 71
Snowflake (NYSE:SNOW) offers data analytics and management software that runs on cloud computing platforms of Google, Microsoft and Amazon. It has been proactively investing in its cloud capabilities and is looking to invest $20 million for training more than 100,000 users on Snowflake AI Data Cloud by 2027. It has also teamed up with Anthropic, a research and security company in the AI domain, to enhance analytics and visualization.
The company registered a 23% y-o-y growth in Q3 earnings but it incurred an operating loss amidst shrinking margins and escalating marketing and R&D expenses. It caters to 10,618 clients with 542 customers generating more than $1 million in revenue. It has shown interest in high-growth markets like ASEAN, LATAM and the Middle East, spending significant amounts in training and developing cloud capabilities. The next fiscal should see SNOW deliver better performance by bringing in new clients with a lesser cost burden.