In this article, we discuss the 14 AI stocks on the radar of Wall Street analysts.
Latest reports from tech news platform TechCrunch indicate that MatX, a chip-design startup focused on supporting large language models, has raised $80 million in a funding round. This follows the $25 million seed round it held less than a year ago. The latest round, led by Spark Capital, values the company at a pre-money valuation in the mid-$200 million range and a post-money valuation in the low $300 million range, per TechCrunch. MatX was co-founded two years ago by former Google TPU team members Mike Gunter and Reiner Pope, who aim to address the global shortage of AI-specific chips.
Read more about these developments by accessing 10 Best AI Data Center Stocks and 10 Buzzing AI Stocks According to Goldman Sachs.
The company’s chips are optimized for AI workloads of 7 billion to 20 billion parameters or more, providing high performance at lower costs. MatX highlights its advanced interconnect technology, which enhances scalability for large clusters. The co-founders claim their processors are designed to outperform NVIDIA GPUs, with a goal of achieving tenfold efficiency in training LLMs and delivering results. The AI hardware sector has seen growing investor interest amid increasing demand for chips tailored for generative AI.
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).
A financial adviser looking over a portfolio of securities and stocks.
14. STMicroelectronics N.V. (NYSE:STM)
Number of Hedge Fund Holders: 18
STMicroelectronics N.V. (NYSE:STM) makes and sells semiconductor products. The company has long-term exposure to structural growth areas such as the energy transition, data centers, and microcontrollers. On November 20, the firm hosted its Capital Markets Day in Paris. The chipmaker reiterated its $20 billion plus revenue ambition and associated financial model, which it now expects to be reached by 2030. The firm also set an intermediate financial model with revenues expected around $18 billion with an operating margin within a 22% to 24% range in 2027-2028.
13. BlackLine, Inc. (NASDAQ:BL)
Number of Hedge Fund Holders: 23
BlackLine, Inc. (NASDAQ:BL) provides cloud-based solutions to automate and streamline accounting and finance operations worldwide. The firm offers AI solutions to businesses that transform raw financial data into insightful summaries that are easy to understand. On November 22, JMP Securities raised the price target on the stock to $86 from $81 and kept an Outperform rating on the shares after attending the company’s annual Beyond the Black user conference. While many of its initiatives will take time to have a visible impact on the model, the advisory continues to like BlackLine as an excellent opportunity for capital appreciation, as BlackLine offers a powerful suite of invoice-to-cash and record-to-report solutions that are now even easier for customers to access with Studio360, and it addresses a large market opportunity estimated at $45 billion, JMP told investors in a research note.
12. Teradata Corporation (NYSE:TDC)
Number of Hedge Fund Holders: 25
Teradata Corporation (NYSE:TDC) provides a connected multi-cloud data platform for enterprise analytics. The company recently announced that Teradata AI Unlimited was now available for public preview through the Microsoft Fabric Workload Hub. The latter allows customers to discover and add new ISV offered capabilities to their Fabric environment. The former, coupled with Microsoft Fabric, is a serverless compute engine that was designed to speed up Trusted AI innovations delivered at enterprise scale.
11. EMCOR Group, Inc. (NYSE:EME)
Number of Hedge Fund Holders: 40
EMCOR Group, Inc. (NYSE:EME) provides construction and facilities, building, and industrial services. The firm has deep links with the hyperscale data center customers, domestic semiconductor firms, and clean energy component manufacturers. It engages in the building of AI data centers for large companies, providing construction, mechanical, and electrical services. On November 22, Northcoast analyst Samuel Snyder initiated coverage of the stock with a Buy rating and $600 price target.
10. Celestica Inc. (NYSE:CLS)
Number of Hedge Fund Holders: 40
Celestica Inc. (NYSE:CLS) offers a range of product manufacturing and related supply chain services. The firm has two primary business interests in the connectivity and cloud solutions and advanced technology solutions markets. On November 22, UBS initiated coverage of the stock with a Neutral rating and $95 price target. The company is an artificial intelligence infrastructure leader but demand is still cyclical over the long term, the advisory told investors in a research note. UBS analysis indicates Celestica shares are already underwriting at least 10% growth over the next 10 years versus the 2025 revenue growth guide of 8.3%. It believes the stock’s risk/reward is balanced and would wait for a more attractive entry point.
9. DocuSign, Inc. (NASDAQ:DOCU)
Number of Hedge Fund Holders: 42
DocuSign, Inc. (NASDAQ:DOCU) provides electronic signature software in the United States and internationally. It recently launched Docusign AI, a tool that helps businesses transform static, unstructured agreement data into insight and action with AI tools. On November 22, JMP Securities analyst Patrick Walravens raised the price target on the stock to $108 from $84 and keeps an Outperform rating on the shares. The advisory says it has collected 10 positive data points on DocuSign, and found eight signs of better-than-expected sales attainment from publicly available sources, including seven salespeople located in the US and one salesperson located in EMEA.
8. Elastic N.V. (NYSE:ESTC)
Number of Hedge Fund Holders: 47
Elastic N.V. (NYSE:ESTC) is a search artificial intelligence company that delivers hosted and managed solutions designed to run in hybrid, public or private clouds, and multi-cloud environments. On November 22, Scotiabank raised the price target on the stock to $135 from $92 and kept an Outperform rating on the shares. The company delivered a strong print, and the advisory’s checks continue to show Elastic is well positioned to benefit from generative AI adoption, Scotiabank told investors.
7. CrowdStrike Holdings, Inc. (NASDAQ:CRWD)
Number of Hedge Fund Holders: 74
CrowdStrike Holdings, Inc. (NASDAQ:CRWD) provides cloud-delivered protection across endpoints and cloud workloads, identity, and data. The firm is harnessing artificial intelligence to streamline and strengthen cyber protection. On November 22, KeyBanc raised the price target on the stock to $395 from $345 and kept an Overweight rating on the shares. The advisory sees a high bar for October security reporters given strong stock performance despite muted Q3 security earnings results thus far, saying its checks have been solid, the advisory told investors in a research note. Results for Crowdstrike were strong, with several partners noting a bounce back this quarter and no mentions of customer migrations away from them, the advisory says.
6. Intel Corporation (NASDAQ:INTC)
Number of Hedge Fund Holders: 68
Intel Corporation (NASDAQ:INTC) markets key technologies for smart devices. Latest reports, published by news platform The Oregonian, suggest that the chipmaker has plans to sell its 150-acre campus in Folsom, California, as part of a broader effort to cut costs amid flagging sales. Per the report, the chipmaker said it is also evaluating the future of its 50-acre Hawthorn Farm property and working to consolidate its footprint at its Silicon Valley headquarters. As rival chipmakers leap ahead courtesy AI, Intel has struggled to maintain chip leadership in recent years, falling behind in technology as well as production.
5. QUALCOMM Incorporated (NASDAQ:QCOM)
Number of Hedge Fund Holders: 74
QUALCOMM Incorporated (NASDAQ:QCOM) develops and sells foundational technologies for the wireless industry. The AI-capable chips of QUALCOMM are now making their way into cars and IoT devices, after powering smartphones globally. Latest reports, published by several tech news platforms, including Notebook Check and GizmoChina, contend that the company is planning to launch a more affordable Snapdragon X chip for Windows laptops to bring down prices. New Windows laptops with Snapdragon chips are AI capable but their high prices have kept them out of reach of ordinary customers.
4. Alphabet Inc. (NASDAQ:GOOG)
Number of Hedge Fund Holders: 160
Alphabet Inc. (NASDAQ:GOOG) is a California-based technology company that owns and runs the internet search engine Google. Publicis Sapient, a digital business transformation company, recently announced a global partnership with Google Cloud aimed at accelerating the adoption of generative AI among enterprise customers. IT Brief Australia reports that the collaboration will involve the creation of a dedicated Google Business Unit by Publicis Sapient to meet increasing demand for Google’s AI technology. Per the report, this unit will provide necessary resources to assist customers in planning, deploying, and managing generative AI projects.
3. NVIDIA Corporation (NASDAQ:NVDA)
Number of Hedge Fund Holders: 193
NVIDIA Corporation (NASDAQ:NVDA) provides graphics, computing and networking solutions. On November 21, Argus analyst Jim Kelleher raised the price target on the stock to $175 from $150 and kept a Buy rating on the shares. The company once again blew out aggressive consensus estimates for fiscal Q3, with revenue up over 90% and non-GAAP earnings rising in triple-digit percentages, the analyst told investors in a research note. The advisory looks for growth beyond data center and artificial intelligence in Nvidia’s other end markets of gaming, professional visualization, and automotive.
2. Microsoft Corporation (NASDAQ:MSFT)
Number of Hedge Fund Holders: 279
Microsoft Corporation (NASDAQ:MSFT) is a Washington-based technology company. d-Matrix, an AI startup backed by Microsoft, recently announced the shipment of its first AI chip. Per reports, published by The American Bazaar, the chip aims to revolutionize how artificial intelligence handles user interactions. The startup has raised more than $160 million so far, with the venture capital arm of Microsoft also taking part in this funding. The startup specializes in AI inference hardware and focuses on optimizing the process of managing user requests on trained AI systems, such as chatbots and video generators.
1. Amazon.com, Inc. (NASDAQ:AMZN)
Number of Hedge Fund Holders: 286
Amazon.com, Inc. (NASDAQ:AMZN) operates as a technology conglomerate with core interests in the ecommerce business. As AI continues to dominate the attention of corporate leaders across the world, Amazon has stepped up efforts to get ahead in the development of quantum computing. The tech giant recently announced the Quantum Embark Program, an advisory program related to quantum computing. Quantum computing hardware, coupled with AI software, is generally considered to be the next big transformative tech.
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.
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