AI startups have raised hundreds of millions through funding rounds this year and fetched valuations in the billions. Most of these startups are software companies working on expanding AI use cases. In the midst of this AI boom, BrightAI, an AI startup that focuses on the physical aspect of the AI business, is now making waves on Wall Street. Founded by Alex Hawkinson, an entrepreneur and investor with a proven track record in the tech world, the company offers an end-to-end tech platform that uses sensors to help companies monitor physical assets. These sensors send data to an AI algorithm that processes it and can help predict potential issues before they arise.
Read more about these developments by accessing 10 Best AI Data Center Stocks and 10 Buzzing AI Stocks According to Goldman Sachs.
Tech news website TechCrunch reports that the startup first launched this product in 2023. Since then, the firm has managed to attract seven large enterprise customers across six verticals, including HVAC, waste management, and power. It has deployed more than 250,000 sensors and has reached $80 million in revenue. These figures are impressive since the startup managed to do this without raising any outside capital. However, the firm is now looking to expand and recently raised more than $15 million in a funding round led exclusively by Los Angeles-based Upfront Ventures.
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 technician observing a complex fiber-optic networking set-up in a laboratory.
14. Symbotic Inc. (NASDAQ:SYM)
Number of Hedge Fund Holders: 15
Symbotic Inc. (NASDAQ:SYM) is an automation technology company that engages in developing technologies to improve operating efficiencies in modern warehouses. The AI business focuses on automating supply chain and warehouse operations. On November 19, Needham raised the price target on the stock to $46 from $40 and kept a Buy rating on the shares. The company handily beat Q4 revenue and EBITDA consensus, and its system gross margins improved sequentially and were slightly above consensus expectations, the advisory tells investors in a research note. Symbotic’s revenue outperformance was driven by record system starts, strong progress on systems in deployment, and a record four completions, Needham added.
13. Rubrik, Inc. (NYSE:RBRK)
Number of Hedge Fund Holders: 23
Rubrik, Inc. (NYSE:RBRK) provides data security solutions to individuals and businesses worldwide. The cybersecurity platform of the firm uses AI and machine learning to monitor for threats and provide sophisticated data recovery. On November 19, Guggenheim raised the price target on the stock to $52 from $48 and kept a Buy rating on the shares. The advisory is raising its price target due to less conservative assumptions, telling investors that it believes Rubrik is set up well to outperform consensus estimates for fiscal Q3 total revenue and subscription ARR, and raise full-year guidance for both metrics by at least the amount of the quarterly upside.
12. Jones Lang LaSalle Incorporated (NYSE:JLL)
Number of Hedge Fund Holders: 31
Jones Lang LaSalle Incorporated (NYSE:JLL) operates as a commercial real estate and investment management company. The company leases space to tech firms as they develop AI data centers. The company recently announced that it had entered into a joint venture with investment firm Slate Asset Management. The JV aims to commercialize Slate’s technology platform for commercial real estate professionals in the JLL Asset Beacon brand. The firm said that generative AI capabilities, powered by the recently launched JLL Falcon platform, such as lease abstraction, entity resolution, and natural language query functionality, will be integrated into JLL Asset Beacon.
11. Monolithic Power Systems, Inc. (NASDAQ:MPWR)
Number of Hedge Fund Holders: 38
Monolithic Power Systems, Inc. (NASDAQ:MPWR) engages in the design, development, marketing, and sale of semiconductor-based power electronics solutions for the computing and storage, automotive, industrial, communications, and consumer markets. On November 18, KeyBanc lowered the price target on the stock to $700 from $1,075 and kept an Overweight rating on the shares. The advisory believes Monolithic Power will lose significant market share on Blackwell with the ramp of GB200/B200, as Hopper PMIC overheating issues have persisted on Blackwell. KeyBanc expects IFX to be the primary supplier on Blackwell, with Renesas having a secondary share. While Monolithic Power is attempting to requalify, the earliest this likely could happen would be with Blackwell Ultra in the second half of 2025.
10. 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 hyperscale data center customers, domestic semiconductor firms, and clean energy component manufacturers. Stifel recently initiated coverage of the stock with a Buy rating and $600 price target as part of a broader note initiating coverage of electrical & mechanical and engineering & construction companies. Stifel likes the scale that positions Emcor to win large data center and manufacturing projects as well as leverage key virtual design and construction and pre-fab capabilities, and believes best practice sharing across the various subsidiaries is a key advantage and has allowed Emcor to expand its capabilities to additional geographic markets over time.
9. Fortinet, Inc. (NASDAQ:FTNT)
Number of Hedge Fund Holders: 47
Fortinet, Inc. (NASDAQ:FTNT) provides cybersecurity and convergence of networking and security solutions worldwide. The Fortinet SecOps platform offers the broadest range of sensors that utilize AI and other advanced analytics to continuously assess cyberthreats. On November 19, RBC Capital analyst Dan Bergstrom raised the price target on the stock to $97 from $82 and kept a Sector Perform rating on the shares. The company’s Analyst Day presentation did a good job in highlighting its opportunity, customer journey across Secure Networking, Unified SASE and Ai-Drive SecOps, and potential product refresh while offering medium term targets, the advisory told investors in a research note.
8. NRG Energy, Inc. (NYSE:NRG)
Number of Hedge Fund Holders: 49
NRG Energy, Inc. (NYSE:NRG) operates as an energy and home services company in the United States and Canada. The firm is emerging as an important AI firm because it produces and sells electricity, vital for powering the AI needs of companies and consumers alike. On November 19, BMO Capital raised the price target on the stock to $100 from $94 and kept a Market Perform rating on the shares. The company provided its much-anticipated long-term outlook refresh with its Q3 results, and both 2024 and 2025 EBITDA midpoints exceeded consensus estimates, the advisory told investors in a research note. At an implied sub-12% free cash flow yield and 12-times P/E on 2026 estimates, and given NRG’s significant buybacks, upside leverage to power, and additional value creation potential, BMO sees incrementally favorable risk return in its shares.
7. Analog Devices, Inc. (NASDAQ:ADI)
Number of Hedge Fund Holders: 63
Analog Devices, Inc. (NASDAQ:ADI) designs, manufactures, tests, and markets integrated circuits (ICs), software, and subsystems products. The firm provides high performance solutions that integrate analog, digital and memory in a reduced form factor. It makes and sells AI microcontrollers and AI accelerators. On November 19, Bank of America lowered the price target on the stock to $245 from $255 and kept a Buy rating on the shares. The advisory revisited its estimates ahead of earnings due on November 26 to adjust for soft Industrial trends led by US and European markets as well as weaker auto production at Western and Japanese OEMs.
6. Taiwan Semiconductor Manufacturing Company Limited (NYSE:TSM)
Number of Hedge Fund Holders: 158
Taiwan Semiconductor Manufacturing Company Limited (NYSE:TSM) makes and sells integrated circuits and semiconductors. On November 19, news publication Bloomberg reported that plans by Chinese tech giant Huawei to develop more powerful chips for AI and phones are facing hurdles due to the US export curbs. In the past few weeks, the US has asked large chip firms like TSM to halt production of advanced AI chips for Chinese firms. TSM has complied with the US demands so far. TSM is marketing 2nm chips that are three generations ahead of present Huawei chips, per the report.
5. 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. On November 19, regulatory authorities in the United Kingdom announced that the Google partnership with AI startup Anthropic will not face further investigation. Per reports in British media, the Competition and Markets Authority in the UK has said its provisional examination of the link-up between the firms had found that it does not qualify for investigation under the merger provisions of UK competition law. Authorities had earlier raised concerns about tech giants investing heavily in AI startups through partnerships.
4. NVIDIA Corporation (NASDAQ:NVDA)
Number of Hedge Fund Holders: 193
NVIDIA Corporation (NASDAQ:NVDA) provides graphics, computing and networking solutions. On November 19, Stifel raised the price target on the stock to $180 from $165 and kept a Buy rating on the shares ahead of the company reporting its fiscal Q3 results. Supply chain data points, as well as discussions with industry participants, remain skewed positively and the advisory expects another beat/raise scenario, Stifel tells investors. While expectations are elevated and this scenario appears to be widely anticipated given that consensus estimates for FY26 and FY27 have moved roughly 4% higher over the past two weeks, the advisory’s checks suggest that a Blackwell driven inflection to the upside is more likely an April quarter event than January and believes that a diverse set of data points support the positive revisions.
3. Meta Platforms, Inc. (NASDAQ:META)
Number of Hedge Fund Holders: 235
Meta Platforms, Inc. (NASDAQ:META) engages in the development of products that enable people to connect and share with friends and family. After Indian authorities imposed a heavy fine on the company over the collection and sharing of user data with other Meta companies through a WhatsApp policy change in 2021, the tech giant said it disagreed with the order and planned to mount a legal challenge. Hyperscalers like Meta have come under increased governmental scrutiny in recent weeks as concerns mount over their usage of data to train AI models.
2. Microsoft Corporation (NASDAQ:MSFT)
Number of Hedge Fund Holders: 279
Microsoft Corporation (NASDAQ:MSFT) is a Washington-based technology company. On November 19, the tech giant announced that it had expanded a strategic collaboration with automation firm Rockwell. The partnership is aimed at providing manufacturing customers with advanced cloud and AI solutions that deliver data insights, streamline operations and enhance scalability – driving operational efficiency and sustainable growth across the industry. The two firms will showcase new releases as part of the collaboration at the upcoming Automation Fair.
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. The company could be one of those affected by a recent decision of AI startup Perplexity to launch a new AI-powered shopping assistant. The AI assistant gives users access to a first-of-its-kind AI commerce experience called Buy with Pro, which lets them check out right on the Perplexity website or app for select products from select merchants. Perplexity will use data from sellers’s sites for the purpose.
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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