In this article, we’re going to talk about the 10 best most active stocks to invest in now.
Are Additional Rate Cuts a Necessity?
The economic landscape is currently marked by mixed signals. The Fed has indicated the potential for additional rate cuts due to weaknesses in the manufacturing sector, despite signs of recovery. While the overall economy remains strong, currency dynamics have shifted, with the US dollar weakening and the euro strengthening. Interest rate yields have fluctuated, suggesting potential changes in investor sentiment. Amidst this complex environment, the Dow continues to hover near record highs, reflecting cautious optimism among market participants.
As stakeholders navigate these developments, they will need to carefully consider how they may influence investment strategies and market behavior in the coming months. CNBC’s Rick Santelli recently covered this situation, which we talked about in our article on the 10 Best Performing Stocks in 2024. Here’s an excerpt from it:
“Chicago Fed President Austan Goolsbee has indicated that many more rate cuts may be necessary over the next year due to signs of weakness in the manufacturing sector. CNBC’s Rick Santelli, who was reporting on September 23, noted that while manufacturing has faced challenges, there are indications it might be recovering slightly, as evidenced by a recent production increase of 0.8%.
He referenced comments…. that the economy is experiencing strong growth and robust consumer spending, which he believed contradicted the concerns raised by Goolsbee. Santelli pointed out that the Dow Jones Industrial Average is currently at all-time highs, suggesting that market sentiment remains positive despite underlying economic weaknesses.
Further discussing the economic landscape, he remarked on the currency markets, noting that the US dollar has fallen to its lowest level since March 2022. In contrast, the euro has reached its strongest level since April 2022. This shift in currency dynamics reflects broader economic trends…”
However, a lot of analysts do not have an opinion as nuanced as that of Santelli. For instance, Michael Kantrowitz, Piper Sandler’s chief investment strategist joined CNBC’s ‘Power Lunch’ on September 23 to discuss why smaller businesses and consumers need the benefits from more rate cuts.
In a conversation regarding the challenges facing US car manufacturers, it was noted that the biggest threat they encounter is the influx of Chinese automobiles into the US market. This concern contrasted with the insights from the President of the Bank of Chicago, who stated that ongoing rate cuts will continue to benefit smaller businesses and consumers who are currently adjusting to higher interest rates. Kantrowitz emphasized the significant impact that lower interest rates can have on the consumer economy, particularly given the substantial amount of debt tied to credit lines and credit cards. As adjustable-rate mortgages decrease, this easing of financial conditions is expected to be beneficial.
Kantrowitz pointed out that before last week, financial conditions had been easing primarily for larger corporations, as evidenced by the S&P 500, which did not require a rate cut. However, small businesses and consumers, who are more closely tied to the prime rate set by banks, had not experienced similar relief until recently. The last report indicated that small businesses were paying an interest rate of 9.5% for 3-month borrowing. This recent easing represents a crucial first step for Main Street, although the strategist believes further cuts are necessary.
He noted a broadening market trend following the July 11 CPI report, highlighting that commercial real estate has emerged as one of the best-performing sectors this quarter, alongside utilities and regional banks. However, it was emphasized that while rate cuts can benefit certain areas indirectly, such as those affected by lower tenure rates, they do not necessarily provide direct support.
Looking ahead at interest rates, there was speculation about how low they might go in the next year. Kantrowitz suggested that policy rates could indeed fall into the 3% range but cautioned that markets might be overly aggressive in their expectations. The anticipated rise in unemployment will play a critical role in shaping equity and fixed-income markets; however, if unemployment increases at a slow and steady pace, as it has been, it may not pose significant challenges to market stability.
Kantrowitz’s opinion reflects a cautious optimism regarding economic conditions as stakeholders face uncertain conditions while keeping an eye on interest rates and their broader implications for various sectors within the economy. With that said, we’re here with a list of the 10 best most active stocks to invest in now.
Methodology
We sifted through Yahoo Finance’s list of the most active stocks that are experiencing high trading volumes. We looked at the top 15 stocks to find the ones that were the most popular among elite hedge funds. We then narrowed down our list to the 10 stocks with high trading volumes and that were the most popular among hedge funds. The stocks are ranked in ascending order of their trading volumes, as of September 23.
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).
10 Best Most Active Stocks To Invest In Now
10. SoFi Technologies Inc. (NASDAQ:SOFI)
Volume: 6.172 million
Average Volume (3-Month): 40.967 million
Number of Hedge Fund Holders: 29
SoFi Technologies Inc. (NASDAQ:SOFI) is a fintech company that operates as a direct bank and serves other financial institutions via its technology platform and reports 8.8 million users as of this year, membership surpassing 5.5 million in Q2 2024 alone. It’s a top online lender in the US, offering products like personal loans, student loan refinancing, investment products, and banking services.
The company targets consumers with high credit scores, reducing risk. Continuous product innovation and brand-building are fueling growth. The tech platform is becoming the go-to platform for financial services, much like AWS for technology.
In Q2 of this year, it added 643,000 new members and grew revenue by 22.12% year-over-year, driven by the combined Financial Services and Tech Platform revenue rising 46% year-over-year. This contribution was 45% of the total adjusted net revenue.
The company’s loan income now accounts for only 57% of total revenue, down from 90% two years ago. The guidance for 2024 shows a slower growth rate of 17% to 19%. Its mortgage origination segment is expected to benefit from falling interest rates and could lower acquisition costs. The innovative approach to IPO participation could prove timely as capital markets seem poised for a potential IPO wave.
It has integrated Galileo’s conversational AI engine into its app. Cyberbank Konecta, the AI assistant, can handle 80% of common inquiries, reducing response times by 65%. With such improvements, SoFi Technologies Inc. (NASDAQ:SOFI) presents a good case for robust revenue growth potential and strong technological capabilities. These factors position it as one of the best most active stocks to invest in now.
Patient Capital Opportunity Equity Strategy stated the following regarding SoFi Technologies, Inc. (NASDAQ:SOFI) in its first quarter 2024 investor letter:
“SoFi Technologies, Inc. (NASDAQ:SOFI) fell in the first quarter despite delivering strong 4Q results and 2024 guidance supported by their non-lending businesses. The company continues to gain share in the digital lending and neo-banking space, consistently growing deposits at $2B a quarter. What differentiates the company is their focus on prime and super-prime customers (average FICO 749). Sofi is early in its life cycle, currently being a small player in a very large total addressable market (TAM). With their strong management team, we believe the company will continue to deliver on their guidance of strong growth and expanding margins.”
9. American Airlines Group Inc. (NASDAQ:AAL)
Volume: 7.428 million
Average Volume (3-Month): 36.008 million
Number of Hedge Fund Holders: 38
American Airlines Group Inc. (NASDAQ:AAL) is an airline holding company formed on December 9, 2013, by the merger of AMR Corporation (parent company of American Airlines) and US Airways Group (parent company of US Airways). It operates a vast network of domestic and international flights and offers services like scheduled passenger and cargo transportation, aircraft maintenance, and airport services, with 1,000 aircraft, and ~6,700 flights daily to ~350 destinations across 50+ countries.
The company’s AAdvantage Business Program (a loyalty initiative), which replaced the previous unmanaged programs, generated more than $2.5 billion in revenue in 2023. It expanded the AAdvantage Business Programs benefits, making it easier for travel managers to use and earn loyalty points for participating companies and end travelers. It also established a dedicated help desk for AAdvantage Business customers.
In the second quarter of 2024, the company made $14.33 billion in revenue, up 1.99% year-over-year. Loyalty revenues were up approximately 8% year-over-year, and AAdvantage members are responsible for 74% of premium cabin revenue. Unit revenue was down 5.6% year-over-year on 8% more capacity.
American Airlines Group Inc. (NASDAQ:AAL) now expects to take delivery of 20 new mainline aircraft this year, down from the previous estimate of 22. The remaining planned deliveries include 11 Boeing 737 MAX 8, 3 787-9, and 3 Airbus A321neo.
As the company remains on track to reduce total debt by $15 billion from peak levels by the end of 2025, it is well-positioned for continued success. It is focused on delivering a reliable operation, maximizing profitability, and re-engineering its business for greater savings and productivity.
McLain Capital stated the following regarding American Airlines Group Inc. (NASDAQ:AAL) in its Q2 2020 investor letter:
“American Airlines (AAL) : With a $6.5bln market cap & adjusting for the current cash burn & incremental net debt, American currently trades at a higher pro-forma enterprise value than it did at the beginning of the year, while revenues are off 80-90%. The two year notes, AAL 5% 6/2022, currently trade 52 cents on the dollar at a yield to maturity of 46%, implying zero equity value for the common stock. At it’s current projected pace of cash burn, the company will expend its current liquidity before year end. American is one of the most popular stocks among retail investors.”
8. Apple Inc. (NASDAQ:AAPL)
Volume: 10.573 million
Average Volume (3-Month): 56.172 million
Number of Hedge Fund Holders: 184
Apple Inc. (NASDAQ:AAPL) is a multinational corporation best known for its consumer electronics, software, and online services. Famous products include the iPhone, iPad, Mac, and Apple Watch, renowned for their focus on user experience, innovative design, and ecosystem of services including the App Store and Apple Music.
The revenue in FQ3 2024 rose by 4.87% year-over-year, with the services division setting a record at $24.2 billion, growing 14% year-over-year. iPhone revenue reached $39.3 billion, despite a slight decline. Moreover, Mac revenue grew by 2% to $7 billion, and iPad revenue by 24% year-over-year.
Shipments for the latest iPhone 16 appear to be lower than last year, according to UBS data. Delivery wait times for the iPhone 16 Pro Max models are shorter than last year in major markets.
In the US, wait times for the iPhone 16 are 26 days, down from 40 days last year. In China, they’re 18 days compared to 36. Despite upcoming Apple Intelligence features, initial pre-order sales for the iPhone 16 series are estimated at 37 million units, down 12.7% year-over-year.
Just a few weeks after launching the new iPhone with Apple Intelligence, the company is likely to unveil new versions of the MacBook Pro, iMac, and Mac Mini in October. These computers will also come pre-loaded with Apple Intelligence and are expected to rival AI workloads of PCs announced by Microsoft. Apple Inc. (NASDAQ:AAPL) debuted Apple Intelligence in June, its first step into the world of GenAI.
Despite potential challenges related to iPhone upgrade cycles and the services business, the company’s strong brand recognition, innovative product lineup, and expanding ecosystem position it well for continued growth.
Parnassus Growth Equity Fund stated the following regarding Apple Inc. (NASDAQ:AAPL) in its Q2 2024 investor letter:
“Apple Inc. (NASDAQ:AAPL) gained but detracted from relative performance due to our underweight. While the company’s overall and iPhone revenues declined year over year, the unveiling of an upgraded iPad Pro and iPad Air boosted investor sentiment. In particular, the introduction of generative AI features allayed concerns that Apple was not keeping pace with competitors.”
7. Hewlett Packard Enterprise Co. (NYSE:HPE)
Volume: 10.697 million
Average Volume (3-Month): 15.127 million
Number of Hedge Fund Holders: 58
Hewlett Packard Enterprise Co. (NYSE:HPE) is a multinational information technology company that sells hardware, software, and related business services, specializing in hybrid IT, helping customers manage their IT infrastructure across on-premises, cloud, and edge environments. It provides servers, storage, networking, software, and consulting services to help businesses modernize their IT operations.
The company reported a 10.11% year-over-year revenue increase in FQ3 2024, primarily due to its AI system conversions, alongside improved profitability. The company’s Server segment grew by 35.1% year-over-year, making up 10% of the total revenue. Revenue from traditional server business also climbed.
Customer demand for HPE AI systems rose sequentially, with opportunities increasing in both enterprise and sovereign AI clouds. AI system orders climbed $1.6 billion in the quarter to a cumulative $6.2 billion since Q1 2023.
The results demonstrate the company’s progress in executing its edge-to-cloud strategy across networking, hybrid cloud, and AI. Recent acquisitions and partnerships, such as with Aruba Networks, enhance its network and cybersecurity capabilities. It expanded its networking business with the pending acquisition of Juniper Networks. This acquisition will accelerate its edge-to-cloud vision.
It is strategically focusing on hybrid cloud solutions, with its GreenLake platform gaining popularity as businesses seek more flexibility in managing workloads. Significant innovation throughout the portfolio has enhanced its relevance to customers and positioned the company to continue delivering profitable growth for shareholders.
6. Palantir Technologies Inc. (NYSE:PLTR)
Volume: 17.973 million
Average Volume (3-Month): 58.14 million
Number of Hedge Fund Holders: 44
Palantir Technologies Inc. (NYSE:PLTR) specializes in software platforms for big data analytics for government and commercial customers. Its software helps organizations analyze large datasets to identify trends, patterns, and insights. The company is known for its work with government agencies, particularly in intelligence, defense, and law enforcement.
In June, Tampa General signed a 7-year expansion to use its AI platform (AIP) for care coordination. Panasonic Energy signed a 3-year expansion to use AIP across finance, quality control, and manufacturing operations. AARP is leveraging AIP to deliver personalized experiences.
In August, it partnered with Wendy’s for supply chain optimization and with Microsoft to bring AI to US national security. Later, it also partnered with Sompo, a Brazilian insurer.
It also secured a 5-year contract with the DEVCOM Army Research Laboratory to extend its Maven Smart System across all military branches. This initiative is valued at up to $229 million.
The second quarter of 2024 saw a 27% year-over-year revenue improvement. Palantir Technologies Inc. (NYSE:PLTR) made a significant impact across various industries with companies reporting impressive results, including Airbus increasing A350 production by 33%, BP cutting costs per barrel by 60%, and Jacobs Connect reducing power usage by 30%. Additionally, Panasonic decreased waste by 12%, ESI Group improved ERP harmonization by 70%, and PG&E lowered transformer ignitions by 65%.
This is a leading AI company with strong positions in infrastructure and oncology. The company’s focus on digital transformation and market share gains positions it well for growth. Revenue expectations from the AI ecosystem’s infrastructure build-out for Palantir Technologies Inc. (NYSE:PLTR) have grown significantly, suggesting a promising future.
Carillon Scout Mid Cap Fund stated the following regarding Palantir Technologies Inc. (NYSE:PLTR) in its first quarter 2024 investor letter:
“The top contributor to return for the quarter was Palantir Technologies Inc. (NYSE:PLTR). Sentiment improved on Palantir after it reported stronger than expected commercial customer revenue and free cash flow. U.S. commercial growth was especially encouraging, as U.S. commercial revenue was up by a large percentage year over year for the fourth quarter and U.S. commercial customer count grew nearly as much. We expect Palantir to become one of the premier artificial intelligence (AI) software providers, built on its Foundry and AIP platforms.”
5. Rivian Automotive Inc. (NASDAQ:RIVN)
Volume: 20.652 million
Average Volume (3-Month): 39.726M million
Number of Hedge Fund Holders: 37
Rivian Automotive Inc. (NASDAQ:RIVN) is an electric vehicle manufacturer, automotive technology company, and outdoor recreation company famous for its electric SUVs and pickups. The company is known for its focus on sustainability and innovative approach to EV technology, especially gaining attention for its R1T and R1S models, which are among the first electric pickups and SUVs to be widely available.
The company is known for its innovative EV tech and has formed partnerships with companies like Amazon, which has a significant stake in the company, and Rivian Automotive Inc. (NASDAQ:RIVN) plans to provide Amazon with 100,000 electric delivery vans. In late June, it signed a $5 billion deal with Volkswagen for a joint venture to develop next-generation software-defined vehicle platforms. The company has $7.7 billion in cash, positioning it for continued EV development.
It delivered 13,790 vehicles in Q2, slightly up from Q1. Production was impacted by a 25-day plant closure for upgrades. The company is undergoing cost-cutting and efficiency-boosting. These factors together contributed to the 3.3% year-over-year revenue improvement in the second quarter of 2024.
The company’s strategy centers around the Rivian Adventure Network (RAN), a dedicated network of DC fast chargers for Rivian owners. It plans to expand the RAN to 3,500 chargers by the end of 2025 and will open it to other electric vehicle brands by the end of 2024, improving charging infrastructure.
The company’s charging infrastructure is powered entirely by renewable energy, and the RAN has achieved an uptime of over 98% in 2024. With a focus on next-generation vehicles and advanced autonomous driving features, it is positioned well for future growth in the EV sector. There are plans for a new factory in Georgia and continuous software updates, making this a top active stock to invest in now.
Meridian Hedged Equity Fund stated the following regarding Rivian Automotive, Inc. (NASDAQ:RIVN) in its Q2 2024 investor letter:
“Rivian Automotive, Inc. (NASDAQ:RIVN) is a US-based electric vehicle manufacturer focused on the design, development, and production of electric adventure vehicles, pickup trucks, and commercial delivery vans. We own Rivian because we believe the company is a future leader in the growing electric vehicle market with a strong brand, compelling products, and a vertically integrated business model. During the quarter, Rivian’s stock price was driven by its progress on cost reduction initiatives and management’s stated confidence in achieving positive gross margins by the end of 2024. The recent announcement of a joint venture with Volkswagen, involving up to $5 billion in investment, also significantly boosted Rivian’s financing outlook and validated its technology. We trimmed our position in Rivian given the strong performance in the quarter.”
4. Tesla Inc. (NASDAQ:TSLA)
Volume: 28.944 million
Average Volume (3-Month): 97.708 million
Number of Hedge Fund Holders: 85
Tesla Inc. (NASDAQ:TSLA) is an automotive and clean energy company that designs, manufactures and sells electric vehicles, including cars, SUVs, and trucks, known for its innovative technology, like the Autopilot driver assistance system and battery technology. It also produces solar panels and energy storage systems, aiming to accelerate the world’s transition to sustainable energy.
Tesla Inc.’s (NASDAQ:TSLA) Gigafactory manufactures EV components. Its Energy Generation and Storage segment includes products like Powerwall, Powerpack, and Megapack, that allow users to store renewable energy. In 2023, 100% of its revenue was generated from sustainable products and services, all while delivering 1.81 million electric vehicles.
In the second quarter of 2024, the company’s revenue improved 2.3% year-over-year. Automotive revenue increased 14% sequentially. Energy storage revenue doubled to reach $3 billion. Despite slowing global EV sales, the company produced over 410,000 units and delivered 444,000 units in Q2, making a contribution of 84% to the total revenue. It aims to scale production to 3 million vehicles by 2025.
Investments in AI have enabled autonomous driving, solidifying its position as a promising long-term stock. Its FSD v12 vehicle is fully AI-driven and has logged 300 billion miles. Beyond self-driving and AI training chips, Tesla Inc. (NASDAQ:TSLA) has also garnered attention for its Tesla Bot, a humanoid autonomous robot capable of performing various tasks.
Its home charging solution, Wall Connector, complements its Supercharger network. The company recently opened its Supercharger network to other EV companies, introducing the North American Charging Standard (NACS). This move maximizes the use of its charging stations and reinforces its role in the wider EV charging ecosystem.
The company’s diversification into the robotaxi business presents a compelling investment opportunity. The unveiling event will be on October 10. As the world shifts towards sustainable energy and electric vehicles, its focus on innovation and technology positions it well to capitalize on these trends.
Baron Partners Fund stated the following regarding Tesla, Inc. (NASDAQ:TSLA) in its Q2 2024 investor letter:
“Tesla, Inc. (NASDAQ:TSLA) manufactures electric vehicles, related software and components, and solar and energy storage products. The stock contributed as Tesla continued to drive vehicle manufacturing costs lower, accelerate the launch of new models, and invest heavily in its lucrative AI initiatives. Shareholders reaffirmed the CEO’s compensation plan, alleviating personnel and legal uncertainties. Despite material operational complexities resulting in significant shutdowns of key manufacturing facilities and lower sales volume, Tesla presented better-than-expected margins in the quarter. It expects to launch a lower cost model as soon as late 2024, which should result in accelerated revenue growth, reduced manufacturing costs, and increased factory utilization. The company continued to advance its autonomous driving capabilities, expanding its already significant data centers and developing its humanoid robot Optimus. These investments increased confidence in the attractive growth opportunities that remain ahead.”
3. Ford Motor Co. (NYSE:F)
Volume: 35.091 million
Average Volume (3-Month): 59.148 million
Number of Hedge Fund Holders: 47
Ford Motor Co. (NYSE:F) is a multinational automobile manufacturer that sells automobiles and commercial vehicles (including cars, trucks, and SUVs) under the Ford brand, and luxury cars under its Lincoln brand. It has a long history of innovation and has been at the forefront of automotive technology, including the development of EVs and autonomous driving systems.
Of the $44.81 billion revenue generated in Q2 2024, up 5.62% from the year-ago period, Ford Pro, a key division for the automaker’s profitability, raised revenue by 21% year-over-year to $5.6 billion in the first half. Subscriptions for Ford Pro software also grew 35% in the second quarter.
The company canceled a three-row EV SUV originally planned for 2027, which was projected to account for 58,000 units in 2028. The automaker announced that the first EV from its California-based skunkworks team will be a mid-size pickup truck, now expected to launch in 2027.
This is slightly delayed from S&P’s earlier forecast but aligns with broader expectations for its new EV lineup rollout starting in 2027. It is heavily investing in its electrification strategy, committing $22 billion through 2025 to advance EVs. Key models like the Mustang, F-150, and Transit are being electrified.
The company is expanding its manufacturing footprint and collaborating with other automakers to improve battery technology to achieve global carbon neutrality by 2050.
Management announced that the company will reduce its capital expenditures for all EVs from 40% to 30%. This shift reflects slower-than-expected EV adoption and the challenges automakers face in achieving profitability with these vehicles. Yet, it’s positioned for growth as certain changes indicate the company’s focus on capital discipline and suggest the potential for reducing near-term losses in its Model-e segment.
2. Intel Corp. (NASDAQ:INTC)
Volume: 48.896 million
Average Volume (3-Month): 80.49 million
Number of Hedge Fund Holders: 75
Intel Corp. (NASDAQ:INTC) is a multinational corporation and technology company that designs, manufactures, and sells computer components and related products for business and consumer markets, such as semiconductors, and integrated circuits, among others. It’s known for its x86 microprocessors, which are used in a wide range of computers and devices.
The company is focused on using its chips to power AR devices. Earlier this year, its Japanese division partnered with 14 domestic firms to establish a research body focused on automating back-end chipmaking processes as Japan and the US work to strengthen their chip supply chains.
Intel Corp. (NASDAQ:INTC) has received up to $3 billion in direct funding under the CHIPS and Science Act for the Secure Enclave program, in addition to an already $8.5 billion federal grant. The funding for the former focuses on projects for US defense, while the latter has gone into semiconductor manufacturing and research projects in Arizona, New Mexico, Ohio, and Oregon.
In Q2, it introduced its new Xeon 6 processors with performance cores and AI accelerators, primarily targeted toward enterprise AI systems for high-performance, cost-effective AI infrastructure. The Intel Xeon 6 processor offers double the performance of its predecessor, while the Intel Gaudi 3 AI Accelerator is optimized for large-scale generative AI.
Despite that, the company recorded a 0.9% year-over-year revenue decline in this quarter, with the total revenue amounting to $12.83 billion. To combat that, the company announced it was cutting 15% of the 125,000-strong workforce and suspended dividends to cut spending and streamline the company. Even with layoffs, the inventory problem won’t be resolved soon because the company has 137 days of inventory, much higher than the industry average of 90 days.
Its strategic focus on reducing costs and improving operational efficiency positions it well for future growth. Despite recent challenges, its strong market presence in semiconductor chip manufacturing and its focus on developing innovative technologies for smart devices suggest a promising outlook for the company.
Ariel Global Fund stated the following regarding Intel Corporation (NASDAQ:INTC) in its Q2 2024 investor letter:
“Alternatively, several positions weighed on performance. One of the world’s largest semiconductor chip manufacturers by revenue, Intel Corporation (NASDAQ:INTC), underperformed in the period on news of a longer than expected turnaround in profitability within the Foundry business. This was exacerbated by disappointing near-term guidance due to a weakening demand environment signaling an extended replacement cycle. We view the quarter as a temporary trough that should dissipate as we see signs of a cyclical recovery for personal computers (PCs) and central processing units (CPUs), driven by the Windows 11 upgrade. In our view, the market is overlooking the progress Intel is making to advance its manufacturing process. Not to mention, the company’s efforts to serve as a viable second source foundry partner of leading-edge silicon. We believe the separation of the design and manufacturing businesses will be a key catalyst in unlocking improved financial performance while also enhancing the competitiveness of the foundry business.”
1. NVIDIA Corp. (NASDAQ:NVDA)
Volume: 120.458 million
Average Volume (3-Month): 327.422 million
Number of Hedge Fund Holders: 179
NVIDIA Corp. (NASDAQ:NVDA) is a technology company that designs, manufactures, and sells graphics processing units (GPUs), artificial intelligence (AI) chips, and other computing technologies. Its GPUs are widely used in gaming, professional visualization, and AI applications, and the company has been a pioneer in the field of GPU computing, with a significant role in the development of AI and deep learning.
In FQ2 2025, the company’s revenue was 122.40% from a year-ago period. Data center revenue was up 54% year-on-year, driven by strong demand for NVIDIA Hopper, GPU computing, and networking platforms. Cloud service providers contributed ~45% of data center revenue. Partnerships with healthcare institutions and increasing demand for AI-powered solutions in diagnostics have contributed to this strong financial performance.
At its GPU Technology Conference earlier this year, the CEO estimated annual spending on data center infrastructure at about $250 billion, with a potential total of $1-2 trillion over the next decade. The company won’t dominate the entire market, but analysts estimate its market share between 2025 and 2029 will be over $950 billion.
Elon Musk’s AI startup, xAI, has brought Colossal, an AI training system, online. Powered by 100,000 H100 GPUs from NVIDIA Corp. (NASDAQ:NVDA), Colossal is the most powerful AI training system in the world. Musk plans to double the size of Colossal by shifting to H200 GPUs in the coming months. Blackwell chips, which are even faster and more efficient, could further enhance Colossal’s capabilities.
The company faces pressure to launch new products to maintain investor confidence. Delays in Blackwell chip production and concerns about high GPU prices impact demand. The company’s future success depends on effective AI monetization. By the end of fiscal year 2025, it aims to achieve 100% renewable electricity for its offices and data centers.
Ithaka US Growth Strategy stated the following regarding NVIDIA Corporation (NASDAQ:NVDA) in its Q2 2024 investor letter:
“NVIDIA Corporation (NASDAQ:NVDA) is the market leader in visual computing through the production of high-performance graphics processing units (GPUs). The company targets four large and growing markets: Gaming, Professional Visualization, Data Center, and Automotive. NVIDIA’s products have the potential to lead and disrupt some of the most exciting areas of computing, including: data center acceleration, artifi cial intelligence (AI), machine learning, and autonomous driving. The reason for the stock’s appreciation in the quarter was twofold: First, the stock benefi ted from tremendous excitement surrounding the further development of generative AI and the likelihood this would necessitate the purchase of a large number of Nvidia’s products far into the future; Second, Nvidia posted another strong beat[1]and-raise quarter, where the company upped its F2Q25 revenue guidance above Street estimates, showcasing its dominant position in the buildout of today’s accelerated computing infrastructure.”
As we acknowledge the growth potential of NVIDIA Corp. (NASDAQ:NVDA), our conviction lies in the belief that AI stocks hold great promise for delivering high returns and doing so within a shorter timeframe. If you are looking for an AI stock that is more promising than NVIDIA but that trades at less than 5 times its earnings, check out our report about the cheapest AI stock.
READ NEXT: $30 Trillion Opportunity: 15 Best Humanoid Robot Stocks to Buy According to Morgan Stanley and Jim Cramer Says NVIDIA ‘Has Become A Wasteland’.
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