In this article, we discuss 11 AI news and ratings you shouldn’t miss.
DeepSeek has quickly gained attention in AI with its R1 model, which delivers high performance at a lower cost. The company has introduced innovations to improve efficiency and accessibility in AI development. DeepSeek’s fast growth, despite having a small team, shows the increasing trend of AI-driven businesses scaling with minimal human resources. Its success also shows the broader shift toward open-source AI models, especially in China, where competition is driving faster innovation and more cost-effective solutions.
UBS’s Insights on DeepSeek R1 and AI Investment Strategies
In a report posted by UBS on January 31, the UBS CIO analyzed the impact of DeepSeek’s R1 model on financial markets and AI investment strategies. The firm expects continued capital spending by hyperscalers, benefiting semiconductor companies, and recommended diversified exposure across AI’s value chain. The declining cost of training large language models is driven by algorithmic advancements and hardware improvements, with R1 increasing AI adoption. Hardware scaling also remains important alongside algorithmic progress to support AI infrastructure investments.
In addition, China continues to play a significant role in AI innovation, with companies like Alibaba developing competitive models. UBS maintained a positive view of Chinese internet firms due to their ability to offer customizable, cost-effective AI solutions. The firm also highlighted the rise of AI-driven startups, emphasizing investment in firms with proprietary data or strong customer retention.
Furthermore, the rapid development of AI software suggests prioritizing physical infrastructure investments over traditional software. AI’s ability to self-improve introduces unpredictability, leading UBS to recommend structured products for volatility exposure while avoiding non-physical assets lacking a competitive advantage.
UBS believes that despite fluctuations, AI investment remains solid, with major tech firms expected to increase capital spending in 2025. AI adoption is also rising, supporting cloud growth and monetization. While volatility may be there due to economic and regulatory factors, AI’s long-term outlook remains positive, with both high-cost and low-cost models expected to coexist.
For this article, we selected AI stocks by reviewing news articles, stock analysis, and press releases. We listed the stocks in ascending order of their hedge fund sentiment taken from Insider Monkey’s database of 900 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).
11 AI News and Ratings You Shouldn’t Miss
11. Conduit Pharmaceuticals Inc. (NASDAQ:CDT)
Number of Hedge Fund Holders: 7
Conduit Pharmaceuticals Inc. (NASDAQ:CDT) is a clinical-stage life science company advancing Phase 2-ready assets using AI-driven development.
On February 7, Conduit Pharmaceuticals announced that it completed Phase I of its collaboration with Sarborg Limited and is now moving to Phase II, focusing on AI and cybernetics in drug development. Phase I involved aligning AI-driven processes with Conduit’s goals, validating proprietary inputs, and analyzing cocrystal candidates. The next phase will develop personalized software dashboards to improve efficiency, providing real-time data on clinical trials and drug discovery. The transition supports Conduit’s efforts to streamline drug repurposing, optimize solid-form identification, and improve clinical trial monitoring, especially in autoimmune disorders.
10. Open Text Corporation (NASDAQ:OTEX)
Number of Hedge Fund Holders: 17
Open Text Corporation (NASDAQ:OTEX) provides information management, cybersecurity, AI, and cloud-based solutions for businesses, supporting digital workflows, security, and automation.
On February 6, OpenText reported FQ2 non-GAAP EPS of $1.11, surpassing estimates by $0.18. Revenue reached $1.34 billion, a 13% decline year-over-year but exceeding expectations by $20 million. The company also marked its 16th consecutive quarter of organic cloud growth. The company management said that it is using AI and SaaS to improve content management, secure collaboration, and automated workflows. The company secured major SaaS deals with SAP, BASF, Aldi, and Munich Re last quarter.
It is also prioritizing its security business, with Muhi Majzoub, EVP of Cybersecurity Products & Services, now dedicated to this area. The new security cloud covers identity, applications, networks, forensics, and upcoming XDR capabilities, strengthened by a partnership with Microsoft Security Copilot on Azure. Recent SaaS wins include Nestlé, Frost Bank, and Capgemini. OpenText is embedding AI across its products, with Titanium X featuring 15 aviators and over 100 agents, and is aiming to evolve corporate roles with digital workers.
