In this article, we discuss 11 important AI news and ratings for investors.
The rapid advancements in artificial intelligence have raised both opportunities and concerns, especially regarding its safety and the ethical implications of its widespread use. Establishing regulatory frameworks for AI is essential to ensure its responsible development, protecting against potential risks while maximizing its positive impact across industries.
Experts Urge AI Firms to Improve Safety Efforts
The Future of Life Institute released its 2024 AI Safety Index, evaluating the safety practices of leading AI companies including Anthropic, Google DeepMind, OpenAI, x.AI, and Zhipu AI among others. The review panel, consisting of prominent AI experts, found significant gaps in the companies’ risk management and safety strategies, especially regarding their ability to ensure that advanced AI systems remain beneficial and under human control.
Despite some positive steps in certain areas, the panel expressed concern that these companies are not adequately addressing the existential risks associated with AI development. The report highlighted the need for improved accountability, transparency, and safety frameworks, as competitive pressures seem to be overshadowing safety considerations. The index aims to provide the public with insights into AI companies’ safety efforts and encourage better practices within the industry.
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Navigating the Future of AI with Safety Standards
In a CNBC interview, Max Tegmark, president of the Future of Life Institute and MIT professor, emphasized the need for AI safety standards, drawing a parallel to regulated industries like aviation and medicine. He highlighted the current lack of clear plans to ensure AI safety, especially as systems like chatbots and autonomous vehicles become more integrated into real-world applications. Tegmark advocates for policy changes to make AI companies prioritize safety, much like other industries, to prevent potentially dangerous outcomes. While the situation is concerning, he believes that proper regulation could lead to significant benefits.
For this article, we selected AI stocks by going through 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. TransAlta Corporation (NYSE:TAC)
Number of Hedge Fund Holders: 28
TransAlta Corporation (NYSE:TAC) focuses on generating and selling electric energy through a mix of hydroelectric, wind, solar, and gas-powered facilities. The company is expected to benefit significantly from AI data center growth.
BMO Capital analyst Ben Pham increased TransAlta’s price target to C$22 from C$17 on December 16, maintaining an Outperform rating. The firm views TransAlta as well-positioned to benefit from Alberta’s data center co-location opportunities, potentially starting in 2025.
Earlier on December 4, the Calgary Herald reported that the Alberta government launched its first roadmap to attract AI-focused data centers, aiming for over $100 billion in investment and thousands of tech jobs. Minister Nate Glubish targets securing $100 billion across several projects in the next five years.
10. Mobileye Global Inc. (NASDAQ:MBLY)
Number of Hedge Fund Holders: 33
Mobileye Global Inc. (NASDAQ:MBLY) develops AI-powered advanced driver assistance systems and autonomous driving technologies. Its solutions utilize real-time detection, navigation, and cloud-based enhancements to improve road safety and enable self-driving capabilities for various vehicle types.
As announced on December 17, At CES 2025, Mobileye will showcase its AI-driven advancements in autonomous driving and road safety, among other things. CEO Prof. Amnon Shashua will present the company’s vision for 2025 and beyond, highlighting innovations such as AI-enhanced Advanced Driver Assistance Systems (ADAS), Mobileye SuperVision for assisted driving, and Mobileye Chauffeur for fully autonomous vehicles. Mobileye’s AI technologies, including REM mapping and sensor fusion, are central to improving vehicle safety and enabling scalable autonomous mobility solutions. Throughout the event, Mobileye will demonstrate how its AI-powered products are shaping the future of transportation and mobility.
9. NetApp, Inc. (NASDAQ:NTAP)
Number of Hedge Fund Holders: 38
NetApp, Inc. (NASDAQ:NTAP) provides a range of data management and cloud solutions designed to transform data infrastructures. The company focuses on AI-driven storage, cloud integration, and data services, helping businesses optimize their data storage, compliance, and cloud operations across various industries.
On December 17, Morgan Stanley increased NetApp’s price target to $146 from $132, maintaining an Equal Weight rating. The firm expects AI-driven companies to perform better in 2025 while being cautious about service provider stocks due to anticipated recovery already factored in.
On the other hand, JPMorgan analyst Samik Chatterjee upgraded NetApp to Overweight from Neutral, raising the price target to $160 from $150. The firm expects faster revenue growth driven by higher IT budgets for data centers and storage as enterprises prepare for AI use. NetApp is also expected to continue gaining market share due to its strong product innovation, including the C-series products and the recent launch of Block storage.
8. Teradyne, Inc. (NASDAQ:TER)
Number of Hedge Fund Holders: 43
Teradyne, Inc. (NASDAQ:TER) develops automated testing systems and robotics solutions, with a focus on AI-driven technologies for semiconductor testing, wireless validation, and manufacturing processes.
Teradyne’s (NASDAQ:TER) subsidiary Universal Robots (UR) is set to host the Collaborate North America 2025 conference in Novi, Michigan, on January 28, 2025, where over 500 manufacturing professionals, automation experts, and industry leaders from organizations like MIT and the Association for Advancing Automation will gather.
The event will feature hands-on demonstrations of over 30 cobot solutions, with a focus on applications such as AI-powered automation, as well as keynote speeches from experts like Stacey Moser, Ben Armstrong from MIT, Jake Hall, and Alex Shikany. This conference offers valuable networking and insights on robotics, automation, and the integration of AI technologies in industrial applications. Event will also include hands-on demonstrations presented by UR and UR+ ecosystem partners, such as A.I. Automation, Schmalz, Magswitch, PIAB, Zimmer, Schunk, Flexline Automation, Acumino AI, and SICK.
7. Dynatrace, Inc. (NYSE:DT)
Number of Hedge Fund Holders: 45
Dynatrace, Inc.’s (NYSE:DT) solutions help automate IT operations and enhance software performance through real-time analytics and cloud automation. The company has been recognized as a Leader in both Cloud-Native Observability and Cloud-Native Security in the 2024 ISG Provider Lens report. The company earned top positions for its competitive strength and portfolio attractiveness, being placed at the highest point in the Cloud-Native Observability quadrant. Partha Chakraborty, Senior Lead Analyst at ISG Research commented:
“By delivering critical AI-driven insights, Dynatrace sets a new standard for observability, enabling teams to better understand their IT environments. Additionally, the company has significantly advanced strategic industry relationships, solidifying its leadership in the security space. Leveraging the power of three AI techniques—causal, predictive, and generative—Dynatrace provides advanced protection against emerging risks, ensuring robust security for modern enterprises.”
6. Synopsys, Inc. (NASDAQ:SNPS)
Number of Hedge Fund Holders: 53
Synopsys, Inc. (NASDAQ:SNPS) tools for integrated circuit design, verification, and testing, leveraging advanced technologies like FPGA-based prototyping and virtual simulation.
Global Data reported that Synopsys (NASDAQ:SNPS) and SiMa.ai have teamed up to advance the development of AI-driven features in next-generation vehicles. This collaboration integrates Synopsys’ electronic design automation tools and automotive-grade IP with SiMa.ai’s machine learning accelerator and software stack.
The solution targets automotive applications such as Advanced Driver Assistance Systems and In-Vehicle Infotainment. The partnership aims to improve hardware-software co-design, reducing development costs and production risks. By combining virtual prototyping with machine learning system-on-chip solutions, the companies seek to simplify development, strengthen system integration, and enable over-the-air updates for smarter, safer vehicles.
5. Baidu, Inc. (NASDAQ:BIDU)
Number of Hedge Fund Holders: 54
Baidu, Inc. (NASDAQ:BIDU) offers AI-driven online marketing and cloud services, leveraging its AI initiatives to enhance its digital platform offerings.
Reuters reported that Asian hedge funds are investing in Chinese tech companies including Baidu (NASDAQ:BIDU), driven by their AI innovations, despite concerns over U.S. export restrictions. Fund managers highlight the rapid adoption of AI across China’s massive consumer base and lower valuations compared to U.S. firms. Companies like Baidu and Xiaomi are advancing AI with products like AI-driven mobile apps, smart wearables, and robotaxis, the report states. However, while Chinese AI models are gaining recognition, some remain cautious about their ability to match U.S. firms’ earnings growth.
4. Accenture plc (NYSE:ACN)
Number of Hedge Fund Holders: 60
Accenture plc (NYSE:ACN) AI-driven services across various industries, focusing on data, automation, and intelligent platforms to optimize business processes.
Accenture (NYSE: ACN) reported Q1 2025 GAAP EPS of $3.59, surpassing expectations by $0.20, and revenue of $17.7 billion, a 9% increase year-over-year, beating estimates by $570 million. New bookings rose 1% to $18.7 billion. The market reacted positively to the news so far as the stock has gained 7% during the day after earnings release as its generative AI bookings continued to grow to $1.2 billion. At the earnings call, Chair & CEO, Julie Sweet said:
“GenAI continues to be a catalyst for reinvention across the enterprise and building out the data foundation necessary to capitalize on AI, as an increasing part of that growth. Themes around achieving both cost efficiencies and growth continue across the demand we’re seeing. Through the examples from Q1, you can see both our strategy to be the reinvention partner of choice and how we are bringing together our services, our ecosystem relationships, and our scaled investments in cutting-edge platforms like SynOps and GenWizard, as well as technologies like GenAI to drive value for our clients.”
For fiscal 2025, Accenture updated its revenue growth forecast to 4%-7% in local currency, adjusted for a foreign exchange impact of -0.5%, and revised its GAAP EPS outlook to $12.43-$12.79.
3. ServiceNow, Inc. (NYSE:NOW)
Number of Hedge Fund Holders: 78
ServiceNow, Inc.’s (NYSE:NOW) solutions integrate machine learning, robotic process automation, and performance analytics to enhance business efficiency and decision-making across various industries.
On December 18, Stifel analyst Brad Reback raised his price target for ServiceNow to $1,175 from $990, driven by stabilizing growth, modest acceleration in top-line performance, and early signs of AI monetization among large software companies. With declining interest rates, solid economic growth, and a “safe haven” status following the election, Reback expects growth in 2025 to align with the positive trends seen in the second half of 2024. Although he anticipates more conservative Q1 guidance from management, overall growth is expected to continue improving due to these factors.
2. Workday, Inc. (NASDAQ:WDAY)
Number of Hedge Fund Holders: 84
Workday, Inc. (NASDAQ:WDAY) offers cloud-based enterprise applications that integrate AI and machine learning for financial, HR, and operational management. Its solutions help businesses streamline processes, gain insights, and improve decision-making through data analytics and automation.
Wolfe Research analyst Alex Zukin raised the price target for Workday (NASDAQ:WDAY) to $320 from $290 while maintaining an Outperform rating on the shares. The firm expressed strong optimism for the software sector going into 2025, highlighting improving business fundamentals, a more relaxed regulatory climate, the growth of artificial intelligence, and a more favorable capital market environment. These factors contribute to the firm’s enthusiasm about the software industry at this time.
RBC Capital has also been bullish on Workday (NASDAQ:WDAY) as the firm raised its price target on Workday to $320 from $300, maintaining an Outperform rating, after meeting with the company’s VP of IR. The firm highlighted peer multiple expansions and shared insights on the demand environment, Workday’s key growth drivers, and management’s FY26 guidance, which includes factors for potential acceleration.
1. NVIDIA Corporation (NASDAQ:NVDA)
Number of Hedge Fund Holders: 193
NVIDIA Corporation (NASDAQ:NVDA) is a leader in AI-driven solutions, providing advanced technologies for cloud-based computing, automotive systems, and data centers.
Nvidia and Apple have collaborated to strengthen large language model (LLM) inferencing using a method called Recurrent Drafter (ReDrafter). This approach, based on a recurrent neural network, combines beam search with dynamic tree attention to improve LLM token generation speed by up to 3.5 tokens per step for open-source models. Integrated into Nvidia’s TensorRT-LLM, ReDrafter has shown a 2.7x increase in token generation speed during testing on Nvidia GPUs, reducing latency and power consumption. The collaboration aims to enable developers to deploy sophisticated models with improved efficiency and performance.
Nvidia said in a blog post:
“This collaboration between NVIDIA and Apple, has made TensorRT-LLM more powerful and more flexible, enabling the LLM community to innovate more sophisticated models and easily deploy them with TensorRT-LLM to achieve unparalleled performance on NVIDIA GPUs. These new features open exciting possibilities, and we eagerly anticipate the next generation of advanced models from the community that leverage TensorRT-LLM capabilities, driving further improvements in LLM workloads.”
While we acknowledge the potential of NVIDIA Corporation (NASDAQ:NVDA) as an investment, our conviction lies in the belief that AI stocks hold greater promise for delivering higher returns and doing so within a shorter time frame. If you are looking for an AI stock that is more promising than NVDA but that trades at less than 5 times its earnings, check out our report about the cheapest AI stock.
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