In this article, we discuss the 15 AI stocks that are dominating headlines.
The European Union recently released the initial draft for the general-purpose AI code of practice under the AI Act, its comprehensive framework aimed at regulating artificial intelligence. This section of the AI Act, which became law earlier this year, specifically addresses general-purpose AI model providers, setting out standards and practices they must follow to ensure responsible AI development and deployment. Some of the AI models that will be impacted by regulations drafted as discussions on this draft progress include GPT models by OpenAI and Claude by Anthropic, among others.
Read more about these developments by accessing 10 Best AI Data Center Stocks and 10 Buzzing AI Stocks According to Goldman Sachs.
Meanwhile, London-based AI startup Tessl recently raised more than $125 million in a funding round led by prominent venture capital firms like Index Ventures, Accel, GV, and Boldstart. According to a report by TechCrunch, this has pushed the valuation of the startup to more than $500 million. The startup is building an AI native platform that developers and their teams can use to create and maintain software. The firm is still developing the product and plans to launch it in the open market by sometime next year. The basic idea behind the business is to help write code to match specifications set by developers and their teams, in natural language or code.
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 close-up of a stock market ticker displaying the company’s stocks.
AI Stocks That Are Dominating Headlines
15. LivePerson, Inc. (NASDAQ:LPSN)
Market Capitalization: $73 Million
LivePerson, Inc. (NASDAQ:LPSN) engages in conversational artificial intelligence. One of the key product offerings of the firm is Conversational Cloud, a tool that integrates voice, messaging, and generative AI to enable businesses to manage AI-powered conversations across platforms. On November 7, the company posted earnings for the third quarter of 2024, reporting losses per share of $0.32, missing analyst estimates by $0.10. The revenue over the period was $74.2 million, down 26% compared to the revenue over the same period last year but beating analyst expectations by more than $2.5 million.
14. Fabrinet (NYSE:FN)
Market Capitalization: $9 Billion
Fabrinet (NYSE:FN) offers optical packaging, along with precision optical, electro-mechanical, and electronic manufacturing services. The company produces fiber-optic cables that power telecommunications, AI data centers, and the global Internet infrastructure. Needham recently assumed coverage of the stock with a Buy rating and $280 price target. The company reported a surprisingly broad-based strong fiscal Q1, with low-speed Datacom carrying growth again as high-speed remained stalled ahead of the expected transition to 1.6T transceivers for Nvidia’s Blackwell, the advisory told investors in a research note. The firm says the addition of artificial intelligence-related demand selling into the heart of the AI clusters adds a whole new dimension to Fabrinet’s opportunity.
13. Pure Storage, Inc. (NYSE:PSTG)
Market Capitalization: $16 Billion
Pure Storage, Inc. (NYSE:PSTG) provides data storage technologies, products, and services in the United States and internationally. On November 13, Evercore ISI maintained an Outperform rating on the stock with a price target of $70. In an investor note, the advisory highlighted the PSTG strategic investment in GPU cloud provider CoreWeave, noting that investors appear to view the CoreWeave partnership as disappointing compared to the likes of a tier-1 hyperscaler such as Microsoft’s Azure, Amazon’s AWS, Alphabet’s GCP, or Meta. However, the advisory thinks the deal at scale, in the 2026/2027 timeframe, could result in sizable revenue/EPS contributions for Pure, which could help Pure sustain or accelerate double-digit top-line growth in the out-years.
12. NRG Energy, Inc. (NYSE:NRG)
Market Capitalization: $19 Billion
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 11, Wells Fargo raised the price target on the stock to $140 from $130 and kept an Overweight rating on the shares. The advisory cites a compelling 5-year update. The core services operations plus share buybacks point to a 10% EPS CAGR. Upside drivers tied to power margins and data center customers could be meaningfully additive, Wells adds.
11. Fortinet, Inc. (NASDAQ:FTNT)
Market Capitalization: $72 Billion
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 11, Susquehanna analyst Shyam Patil raised the price target on the stock to $90 from $70 and kept a Neutral rating on the shares. The advisory said they reported 3Q with top- and bottom-line metrics ahead of expectations, with particular strength on the bottom line. The company called out solid quarter-to-date trends, though 4Q billings were guided a bit softer due to some conservatism around some larger deals in the pipeline.
10. Dell Technologies Inc. (NYSE:DELL)
Market Capitalization: $95 Billion
Dell Technologies Inc. (NYSE:DELL) designs, develops, manufactures, markets, sells, and supports various comprehensive and integrated solutions, products, and services. On November 14, Kyndryl, an IT service management firm, announced that it had launched an artificial intelligence private cloud in Japan, in partnership with Dell Technologies. The IT service firm, a spinoff of IBM, noted that the new AI private cloud in Japan will help financial institutions, insurance providers, manufacturers, retail companies, and academics to confidently design and prepare to deploy innovative AI-powered solutions.
9. Arm Holdings plc (NASDAQ:ARM)
Market Capitalization: $149 Billion
Arm Holdings plc (NASDAQ:ARM) architects, develops, and licenses central processing unit products and related technologies for semiconductor companies and original equipment manufacturers. On November 13, the company announced that Equal1, an Ireland-based quantum computing powerhouse, had successfully tested the first chip incorporating an Arm Cortex processor at an astonishing temperature of 3.3 Kelvin. This is just a few degrees warmer than absolute zero, the theoretical lowest possible temperature where atomic motion nearly stops. The achievement is important for quantum AI applications, an area where quantum computing could dramatically improve efficiency.
8. Advanced Micro Devices, Inc. (NASDAQ:AMD)
Market Capitalization: $240 Billion
Advanced Micro Devices, Inc. (NASDAQ:AMD) operates as a semiconductor manufacturer. Mizuho analyst Vijay Rakesh recently penned an investor note on the AI industry, noting that AMD expected the AI server market to grow to $500 billion in size by 2028. Per Rakesh, the AI server market was now a total addressable market of $400 billion or more and could grow more than 60% between 2023 and 2027. As it anticipates this growth in AI, the firm recently also confirmed plans to reduce its global workforce by 4% as it implements AI growth plans.
7. ASML Holding N.V. (NASDAQ:ASML)
Market Capitalization: $268 Billion
ASML Holding N.V. (NASDAQ:ASML) makes and sells advanced semiconductor equipment systems. At an Investor Day meeting on November 14, the company reaffirmed long-term guidance numbers, saying it expected annual revenue between approximately $46.23B billion – $63.04 billion, with gross margin between 56% and 60% by 2030. Analysts had projected the firm to generate revenue of $60.89 billion by 2030. The firm also expects a double-digit EUV lithography spending CAGR between 2025 and 2030 for both advanced Logic and DRAM. It pledged to grow dividends and share buybacks during that time as well.
6. Taiwan Semiconductor Manufacturing Company Limited (NYSE:TSM)
Market Capitalization: $851 Billion
Taiwan Semiconductor Manufacturing Company Limited (NYSE:TSM) makes and sells integrated circuits and semiconductors. On November 14, news agency Reuters reported that Yang Chin-long, the governor of Taiwan’s central bank, highlighted the importance of cordial relations between the US and Taiwan under a new US president, and affirmed that TSM investment in China – the chipmaker is spending $65 billion to build chip facilities in the country – could help address a trade imbalance between the two countries. In his last term as president, Donald Trump had imposed tariffs on Chinese firms but spared Taiwan.
5. Meta Platforms, Inc. (NASDAQ:META)
Market Capitalization: $1.5 Trillion
Meta Platforms, Inc. (NASDAQ:META) engages in the development of products that enable people to connect and share with friends and family. Latest reports, published by news website Analytics Insight, contend that Xiaomi, the Chinese tech firm, is planning to enter the smart glasses market with a new AI-powered wearable developed in collaboration with Goertek, a firm that makes and sells smart hardware. The reports come merely days after another Chinese firm, Baidu, launched AI-powered smart glasses. Both companies aim to compete with Ray-Ban Meta Smart Glasses, the AI smart glasses market offered by Meta.
4. Amazon.com, Inc. (NASDAQ:AMZN)
Market Capitalization: $2.1 Trillion
Amazon.com, Inc. (NASDAQ:AMZN) operates as a technology conglomerate with core interests in the ecommerce business. On November 14, news publication Business Insider reported that Amazon was planning to integrate its AI chatbot Q with Microsoft’s Office 365 service. Per the publication, the integration aims to expand Q’s user base by leveraging the popularity of Office 365. Amazon Q, launched in April, faces competition from Microsoft’s own Copilot AI assistant.
3. Alphabet Inc. (NASDAQ:GOOG)
Market Capitalization: $2.2 Trillion
Alphabet Inc. (NASDAQ:GOOG) is a California-based technology company that owns and runs the internet search engine Google. On November 14, the company started rolling out new AI protection features for Android users. One of the most notable of these is a feature that monitors calls of users to detect signs of a possible scam, alerting them with warnings. According to the tech firm, the monitored calls are not saved, sent to servers, or kept after the call finishes. The processing for the feature is done entirely on the local device, per the company.
2. Microsoft Corporation (NASDAQ:MSFT)
Market Capitalization: $3.1 Trillion
Microsoft Corporation (NASDAQ:MSFT) is a Washington-based technology company. On November 14, Jefferies analysts, led by Brent Thill, penned an investor note on the company, affirming that the management of the company was confident in the long-term potential of AI even as investors expressed concerns about the return on massive spending in the new sector. The analysts further noted that the tech giant intends to increase CapEx over the next few years as AI becomes more widespread, and even if AI inexplicably fails, Microsoft still has 340 data centers which are re-usable for other products.
1. NVIDIA Corporation (NASDAQ:NVDA)
Market Capitalization: $3.6 Trillion
NVIDIA Corporation (NASDAQ:NVDA) provides graphics, computing and networking solutions. On November 14, Raymond James analyst Srini Pajjuri raised the price target on the stock to $170 from $140 and kept a Strong Buy rating on the shares. Raymond James sees another strong quarter driven by healthy Hopper demand and early Blackwell ramps, but supply remains a wildcard and consensus has already moved higher, which could limit near-term upside, the advisory told investors in a research note. The advisory thinks $34 billion revenue for Q3 and $37 billion – $37.5 billion guidance is a more likely outcome, and says its base case is for Nvidia to ship roughly 100,000 Blackwell GPUs in Q4, near the low-end of expectations, though Blackwell ramps should accelerate in the first half of 2025 and see strong demand through 2025. Raymond James views any pullback due to high expectations as a buying opportunity.
While we acknowledge the potential of NVIDIA Corporation (NASDAQ:NVDA) 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 NVIDIA Corporation (NASDAQ:NVDA) but that trades at less than 5 times its earnings, check out our report about the cheapest AI stock.
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