In this article, we discuss the 11 AI news and ratings you should not miss.
Investors are eagerly waiting for the election results in the United States as they seek to adjust their money making strategies in light of the latest developments. Investment advisory Wedbush Securities released an investor note in this regard recently, noting that a historic victory for Republican candidate Donald Trump and a potential Republican sweep would result in a very bullish market reaction for technology and be beneficial for artificial intelligence. Analysts at the advisory forecast a very robust bullish market reaction from a Trump win, with Big Tech front and center. The analysts further cautioned that China tariffs and a harsher stance on Beijing from Trump will need to play out over the coming year for its impact on the supply chain/chips and Big Tech. However, Wedbush expected a strong AI focus out of the gates from Trump for US Big Tech players, Khan out at the FTC, and Musk’s big bet on Trump being a home run for his company.
Read more about these developments by accessing 10 Best AI Data Center Stocks and 10 Buzzing AI Stocks According to Goldman Sachs.
Wedbush analysts projected that a Trump win would be worth around $50 per share for Tesla. They also underlined that Washington would roll out new AI initiatives under the Trump administration that would benefit big tech players, with the defense department also boosting companies that work closely on AI adoption in the military. The bullish commentary comes as big tech firms grapple with ballooning CapEx on the one hand and investor pressures for short-term results on the other. Mark Zuckerberg said during the earnings call of his company that building out the infrastructure was maybe not what investors wanted to hear in the near term, but the opportunities here were really big, and his firm was going to continue investing significantly in this.
Read more about these developments by accessing 30 Most Important AI Stocks According to BlackRock and Beyond the Tech Giants: 35 Non-Tech AI Opportunities.
For this article, we selected AI stocks by combing through news articles, stock analysis, and press releases. These stocks are also popular among hedge funds.
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).
An overhead view of a bustling stock exchange, with brokers and traders exchanging stocks.
11. Arm Holdings plc (NASDAQ:ARM)
Number of Hedge Fund Holders: 38
Arm Holdings plc (NASDAQ:ARM) architects, develops, and licenses central processing unit products and related technologies for semiconductor companies and original equipment manufacturers. As the results of the US election roll in, investment advisory Goldman Sachs has highlighted three companies that investors should have on their radar. One of these is Arm Holdings. Per the advisory, Arm will keep increasing its market share in the server sector, while also achieving ongoing margin improvement and earnings growth in the coming months.
10. Celestica Inc. (NYSE:CLS)
Number of Hedge Fund Holders: 38
Celestica Inc. (NYSE:CLS) offers a range of product manufacturing and related supply chain services. On November 5, Barclays analyst George Wang initiated coverage of the stock with an Overweight rating and $91 price target. As a North American tier 1 electronics manufacturing services and original design manufacturer company, Celestica is uniquely positioned to enable hyperscale data centers with switch and compute needs and meet the growing demands of artificial intelligence and machine learning, the advisory told investors in a research note. The advisory sees continued margin expansion for the company driven by its hardware platform solutions products.
9. Palantir Technologies Inc. (NYSE:PLTR)
Number of Hedge Fund Holders: 44
Palantir Technologies Inc. (NYSE:PLTR) is an American company that specializes in software platforms for big data analytics. The company has received bullish calls from analysts following third quarter results that crushed estimates. Wedbush analyst Daniel Ives on November 5 maintained an Outperform rating on the stock and raised the price target to $57 from $45. The analyst noted that the new price target reflected the increased confidence in the game-changing Artificial Intelligence Platform, or AIP, strategy of the firm with use cases for AI taking hold over the next 12 to 18 months. Ives added, referring to the results, that this was an eye-popping quarter for the Messi of AI growth story as AIP received unprecedented demand as more enterprises realized the value of PLTR’s entire product suite with more AI use cases being brought to the table.
8. QUALCOMM Incorporated (NASDAQ:QCOM)
Number of Hedge Fund Holders: 100
QUALCOMM Incorporated (NASDAQ:QCOM) develops and sells foundational technologies for the wireless industry. The company is expected to post fourth quarter earnings later today. Analysts expect the company to report earnings per share of $2.57, representing a 27% increase, and a 14.5% increase in its revenue to $9.93 billion. The firm has made efforts in recent months to diversify towards the automotive and AI sectors from the smartphone market. Analysts expect gains from these diversification efforts to be evident in the results. However, they also expect the softness in the smartphone market to continue. JPMorgan analyst Samik Chatterjee has said that Qualcomm faces specific challenges in relation to lapping loss of revenue to Huawei, while adoption of both AI PCs as well as AI Smartphones remain at a modest pace for now.
7. Taiwan Semiconductor Manufacturing Company Limited (NYSE:TSM)
Number of Hedge Fund Holders: 156
Taiwan Semiconductor Manufacturing Company Limited (NYSE:TSM) makes and sells integrated circuits and semiconductors. On November 5, news publication Financial Times reported that Wendell Huang, the CFO of TSM, had told investors last month that the semiconductor foundry expected to pay more for its power in Taiwan than in other countries around the world. The CFO said that the price had doubled in the past few years, and next year, the firm expected the electricity price in Taiwan to be the highest among all the regions it operated in. The company has previously said that gross margins could take a 1 percentage point hit due to high power prices in the coming year.
6. Alphabet Inc. (NASDAQ:GOOG)
Number of Hedge Fund Holders: 165
Alphabet Inc. (NASDAQ:GOOG) is a California-based technology company that owns and runs the internet search engine Google. On November 5, the company announced that it would be partnering with Saudi Arabia’s Public Investment Fund to open up an artificial intelligence hub in the Middle Eastern country. Per Saudi authorities, the new hub would focus on creating Arab language AI models and Saudi-specific AI applications. The development is important in the business world as the PIF is one the largest sovereign wealth funds in the world, estimated to have more than $930 billion in assets under management.
5. NVIDIA Corporation (NASDAQ:NVDA)
Number of Hedge Fund Holders: 179
NVIDIA Corporation (NASDAQ:NVDA) provides graphics, computing and networking solutions. The firm recently surpassed Apple to become the largest publicly-traded company in the world. On November 5, the company announced that it would be collaborating with application developer Hugging Face to accelerate robotics research and development. Under the agreement, the LeRobot open AI platform of the latter would be combined with NVIDIA AI, Omniverse and Isaac robotics technology that will enable researchers and developers to drive advances across a wide range of industries, including manufacturing, healthcare and logistics.
4. Apple Inc. (NASDAQ:AAPL)
Number of Hedge Fund Holders: 184
Apple Inc. (NASDAQ:AAPL) is a consumer electronics firm. On November 6, reports published by news platform Nikkei Asia suggested that the company had approached iPhone supplier Foxconn about building artificial intelligence servers in Taiwan for its internal use. Although a deal in this regard is still yet to be finalized, the report suggested that the size of the order would likely be relatively small and is primarily aimed at helping Apple ramp up its computing capability. The publication also reported, citing sources, that Foxconn’s capacity to take on Apple as a server customer may be limited, as the Taiwanese firm is also the leading manufacturer of NVIDIA’s AI servers.
3. Meta Platforms, Inc. (NASDAQ:META)
Number of Hedge Fund Holders: 219
Meta Platforms, Inc. (NASDAQ:META) engages in the development of products that enable people to connect and share with friends and family. On November 5, Morgan Stanley analyst Brian Novak said in a research note that Meta continued to focus on efficiency, productivity and leaner operations even as it raised capital expenditures due to AI investments. Per Novak, the firm was expected to spend over $52 billion in 2025 as it competed with other tech giants for AI supremacy. Novak noted that revenue and engagement trends were improving across Meta’s platform, and industry and company conversations spoke to progress driving incremental Reels engagement and monetization.
2. Microsoft Corporation (NASDAQ:MSFT)
Number of Hedge Fund Holders: 279
Microsoft Corporation (NASDAQ:MSFT) is a Washington-based technology company. On November 5, Morgan Stanley analyst Brian Nowak released an investor note on the AI industry, forecasting that hyperscaler CapEx would reach close to $300 billion in 2025, with Microsoft being one of the heaviest spenders in the AI race. Per Novak, the tech firm would raise CapEx to close to $90 billion next year. The note detailed that Microsoft was a top spender in the AI space as it continued to build out public cloud adoption and AI. Novak added that multiple expansion and positive estimate revisions would come for the firm from greater than expected strength in commercial business in coming years.
1. Amazon.com, Inc. (NASDAQ:AMZN)
Number of Hedge Fund Holders: 308
Amazon.com, Inc. (NASDAQ:AMZN) operates as a technology conglomerate with core interests in the ecommerce business. On November 5, investment advisory Morgan Stanley forecast that the tech giant would spend close to $97 billion in the coming year on capital expenditures as the race to power generative artificial intelligence and large language models heats up among hyperscalers. Analysts led by Brian Nowak penned an investor note on the topic and noted that Amazon was expected to spend the most capex on hyperscaler initiatives in 2025. Per the analysts, Amazon’s high-margin businesses continued to allow Amazon to drive greater profitability while still continuing to invest.
While we acknowledge the potential of Amazon.com, Inc. (NASDAQ:AMZN) 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 Amazon.com, Inc. (NASDAQ:AMZN) 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’.
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.
