12 Best New Stocks to Buy According to Hedge Funds

6) Astera Labs, Inc. (NASDAQ:ALAB)

Number of Hedge Fund Holdings: 39

Astera Labs, Inc. (NASDAQ:ALAB), which began trading on March 20, 2024, designs, manufactures and sells semiconductor-based connectivity solutions for cloud and AI infrastructure. Its products address bottlenecks in modern computing architectures, enabling seamless communication between various components of high-performance computing systems.

Wall Street analysts are optimistic about Astera Labs, Inc. (NASDAQ:ALAB)’s strong pipeline of upcoming products which should propel growth. As per Morgan Stanley, the Scorpio PCIe Gen 6 Switch is expected to significantly boost content per GPU, which should help add hundreds of dollars per unit. This new product is incrementally positive to Morgan Stanley’s financial forecast and should be a meaningful driver of CY25 revenue and earnings. This will also be the first Gen 6 product available on the market. Notably, the previous generation was mainly dominated by Broadcom.

The Scorpio Smart Fabric Switch family expands Astera Labs, Inc. (NASDAQ:ALAB)’s mission of solving the increasingly complex connectivity challenges within AI infrastructure, both for scale-out and for scale-up networks.

Astera Labs, Inc. (NASDAQ:ALAB) expects that Scorpio will expand its total market opportunity for the four product families to over $12 billion by 2028. Over the coming quarters, the company plans to further expand its business opportunities for the Scorpio product family across PCIe Gen 5, PCIe Gen 6, and platform-specific customized connectivity platforms.