In this article, we discuss the 17 trending AI stocks on latest analyst ratings and news.
The AI industry continues to be highly dynamic, with significant growth anticipated across various sectors in 2024. The expansion of generative AI, which saw exponential growth in 2023, is expected to continue this year, potentially unlocking trillions of dollars in value as businesses move from pilot projects to broader implementation. This shift suggests that 2024 will be a pivotal year for AI as companies aim to leverage capabilities more fully to drive efficiency, reduce costs, and innovate across different industries. The market for generative AI is forecasted to grow rapidly, with a compound annual growth rate of close to 60%, reaching a valuation of around $37 billion by 2028. This growth is fueled by the widespread adoption of AI technologies in areas such as healthcare, finance, and customer service.
Read more about these developments by accessing 33 Most Important AI Companies You Should Pay Attention To and Billionaire Druckenmiller is Betting on AI
The AI revolution is already transforming operations across the world by automating tasks, analyzing large datasets, and enhancing predictive capabilities. The healthcare sector, for example, is poised for substantial advancements due to AI, with the market expected to grow to around $188 billion by 2030, driven by innovations in genomics, drug discovery, and personalized medicine. Edge computing is another area likely to see significant development in 2024, as it becomes increasingly critical for enabling AI applications that require real-time data processing. The move towards edge computing, where data is processed closer to the source, is expected to reduce latency and improve the performance of AI systems, particularly in sectors like autonomous vehicles, IoT, and industrial automation.
This trend underscores the growing importance of a robust semiconductor supply chain, especially as global trade tensions and geopolitical events continue to impact the availability of critical components like chips. Experts also emphasize the growing importance of ethical considerations and responsible AI. As AI technologies become more deeply embedded in various aspects of society, concerns around privacy, bias, and security are likely to intensify, prompting calls for clearer regulatory frameworks and guidelines to ensure that AI is developed and deployed responsibly. The rapid growth will also bring challenges related to talent acquisition, supply chain management, and the need for responsible AI practices. As such, the industry is likely to be marked by both tremendous opportunities and complex challenges in the near term.
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For this article, we selected AI stocks based on the latest news and analyst ratings. 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).
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Trending AI Stocks on Latest Analyst Ratings and News
17. Intel Corporation (NASDAQ:INTC)
Number of Hedge Fund Holders: 75
Intel Corporation (NASDAQ:INTC) markets key technologies for smart devices. The company recently announced that it had signed a deal with cloud security provider F5 to simplify the security and delivery of artificial intelligence services. Under the deal, the two companies will offer a new joint solution, combining security and traffic management from the NGINX Plus of the latter with the OpenVINO toolkit and Infrastructure Processing Units of the former to deliver superior protection, scalability, and performance for advanced AI inference. This integrated solution will be beneficial for edge applications, such as video analytics and IoT, where low latency and high performance are important.
Intel Corporation (NASDAQ:INTC) stock has been trending since the firm announced that it would be postponing an upcoming innovation event, widely expected to showcase the AI prowess of the firm, amid layoffs and a CPU bug situation. Latest reports indicate that the event has been pushed back to the first quarter of 2025.
16. QUALCOMM Incorporated (NASDAQ:QCOM)
Number of Hedge Fund Holders: 78
QUALCOMM Incorporated (NASDAQ:QCOM) develops and sells foundational technologies for the wireless industry. The company recently provided a preliminary outlook for the first quarter of 2025 that forecast 5% revenue growth, below market expectations of 9% growth. The outlook spooked investors, but Wall Street analysts have sought to ease these concerns. For example, Bank of America analyst Tal Liani noted that a rebound in the premium part of the smartphone market, along with AI PCs, and better terms for upcoming licensing negotiations should work in the favor of the chipmaker in the coming months.
The analyst reiterated a Buy rating on QUALCOMM Incorporated (NASDAQ:QCOM) stock with a price target of $245, highlighting that the underlying fundamentals of the firm remain solid, and there were meaningful growth drivers for it in the medium to long term. The chipmaker expects to earn between $2.45 and $2.65 per share on an adjusted basis in the coming quarter, with revenue forecast between $9.5 billion and $10.3 billion.
15. Applied Materials, Inc. (NASDAQ:AMAT)
Number of Hedge Fund Holders: 77
Applied Materials, Inc. (NASDAQ:AMAT) provides equipment, services, and software for the semiconductor industry. The company is well positioned to capitalize on the AI boom. There is growth in the HBM, DRAM, and advanced packaging markets as AI data center build gets underway. Applied Materials is a leading supplier of these products to tech giants like Intel, Apple, and Samsung. The financials of the chipmaker remain as strong as ever. Recent financial results show 5.5% revenue growth and 7.4% adjusted operating profit growth, with a revenue forecast of $27 billion for FY24.
Applied Materials, Inc. (NASDAQ:AMAT) has earned bullish calls from Wall Street in recent weeks. JPMorgan analyst Harlan Sur recently raised the price target on the stock to $250 from $240 and kept an Overweight rating, noting that the company reported solid July quarter results driven by accelerating demand in advanced foundry/logic, DRAM, high bandwidth memory and ICAPs combined with sustained strength in services.
14. Celestica Inc. (NYSE:CLS)
Number of Hedge Fund Holders: 38
Celestica Inc. (NYSE:CLS) offers a range of product manufacturing and related supply chain services. The stock has climbed more than 80% so far this year as the demand for the networking products marketed by the firm, including 400G and 800G switches, skyrockets. These switches are able to transmit data at very high speeds, thus making complex AI computations possible. Some of the biggest customers of the company for these products include tech giants like Google and Amazon. The firm expects to generate more than $1.2 billion in revenue from AI in 2024. If the target is achieved, the firm would effectively triple the AI revenue it made in the 2022 fiscal year.
In the second quarter earnings call, Rob Mionis, the CEO of Celestica Inc. (NYSE:CLS), noted that there was strong demand for the Hardware Platform Solutions marketed by the firm, comprising storage, compute, and networking products. This healthy demand, likely to increase in the coming months as hyperscalers invest in AI data centers, had helped the firm post a more than 50% year-to-year increase in connectivity revenues in the second quarter.
13. Taiwan Semiconductor Manufacturing Company Limited (NYSE:TSM)
Number of Hedge Fund Holders: 156
Taiwan Semiconductor Manufacturing Company Limited (NYSE:TSM) makes and sells integrated circuits and semiconductors. The firm is well positioned to benefit from the AI wave as companies rollout AI features on devices like smartphones and computers, the two end markets that TSM dominates. The bulk of the net revenue of the firm is generated by these two markets. The smartphones division accounts for 33% of the net revenue while the computing division makes up 52% of the net revenue. Some of the largest customers of the firm include famous names like Apple, NVIDIA, Intel, AMD, Qualcomm, and MediaTek, among others. Through these firms, the company has a 61% market share in the foundry business.
As the US ramps up efforts to manufacture chips inside the country, Taiwan Semiconductor Manufacturing Company Limited (NYSE:TSM) had announced plans to build a facility on the outskirts of Phoenix back in May 2020 for this purpose. The New York Times reports that the project, estimated to cost more than $70 billion, has still yet to fully take off, with TSM not selling semis made at the facility yet.
12. Micron Technology (NASDAQ:MU)
Number of Hedge Fund Holders: 120
Micron Technology (NASDAQ:MU) makes and sells memory and storage products. Even with substantial investments in AI tech, the financials of the firm remain as strong as ever, offering lots of value against peers in the space. For example, analysts expect the revenue of the firm in the third quarter to grow by over 90% year-on-year. This performance also translates into an expected EPS improvement of over 200% year-on-year. According to quarterly estimates, the firm is expected to sustain a revenue growth rate of over 40% year-on-year for at least the next six quarters.
The exceptional performance of Micron Technology (NASDAQ:MU) has earned the firm bullish calls on Wall Street. KeyBanc has an Overweight rating on the stock with a $145 price target. In an investor note, the advisory backed the company to gain an outsized share on the latest high bandwidth memory products, which likely will exceed its traditional DRAM share, based on concerns about Samsung matching Micron in terms of manufacturing yields in this regard.
11. Arm Holdings plc (NASDAQ:ARM)
Number of Hedge Fund Holders: 38
Arm Holdings plc (NASDAQ:ARM) architects, develops, and licenses central processing unit products and related technologies for semiconductor companies and original equipment manufacturers. The company has gone under the radar of AI investors in the past few months but has significant growth potential. For example, the projected revenue of the firm from AI data centers will reach $13 billion by 2028, representing 27% of the overall market. In addition to strong revenue pull from AI, the firm also has a technological edge over rivals like Intel and AMD. The Neoverse platform of Arm offers high-performance computing and AI capabilities.
Arm Holdings plc (NASDAQ:ARM) can also count tech giant Apple among a host of customers that have expressed interest in the chip architecture designed by the firm. Apple has reportedly signed a deal with Arm in this regard until 2040. Under this deal, the Armv9 architecture will be integrated in future M-series chips. Arm also dominates the smartphone market, powering nearly 95% of smart devices worldwide.
10. Palantir Technologies Inc. (NYSE:PLTR)
Number of Hedge Fund Holders: 44
Palantir Technologies Inc. (NYSE:PLTR) builds and deploys software platforms for the intelligence community to assist in counterterrorism investigations and operations. The company recently announced that it had signed a deal with tech giant Microsoft to provide artificial intelligence services for the defense and intelligence communities. As part of this deal, the companies will integrate the large language models of the latter via Azure OpenAI service with the AI Platform of the former in the government and classified cloud environments. The offering will help operators safely build AI-driven operational workloads across defense and intelligence verticals, per the two companies.
Wall Street analysts have labeled the deal between Palantir Technologies Inc. (NYSE:PLTR) and Microsoft as potentially game changing and likely to be a launching pad for the Artificial Intelligence Platform being marketed by the former. Analyst Dan Ives of Wedbush has an Outperform rating and a $38 price target on the shares. In a recent investor note, Ives noted that with the marquee deal solidified, Palantir would continue to accelerate AIP adoption within the federal sector.
9. Broadcom Inc. (NASDAQ:AVGO)
Number of Hedge Fund Holders: 130
Broadcom Inc. (NASDAQ:AVGO) supplies semiconductor infrastructure software solutions. The firm recently announced that it would be partnering with Hitachi Vantara, a California-based data analytics firm, to introduce a new private and hybrid cloud solution, meant to handle the complexities of data proliferation and artificial intelligence requirements. The partnership would combine the computing powers of the Unified platform of the latter with the VMware Cloud Foundation of the latter. The platform is intended to provide flexibility for deploying business and mission-critical workloads with blended server-based virtualized storage and external storage.
Strategic partnerships like the one detailed above have put Broadcom Inc. (NASDAQ:AVGO) on the radar of Wall Street analysts. TD Cowen recently raised the price target on the stock to $210 from $175 and kept a Buy rating. In an investor note, the advisory highlighted that the company offered broad revenue exposure to hyperscale, artificial intelligence, telecom, and enterprise, and investors were willing to pay a premium for a unique quality semis/software franchise with industry-leading margin.
8. Vistra Corp. (NYSE:VST)
Number of Hedge Fund Holders: 92
Vistra Corp. (NYSE:VST) operates as an integrated retail electricity and power generation company. Over the past few years, the utilities sector has faced myriad challenges. Interest rates surged after the pandemic, creating an environment where borrowing was difficult and income-focused investors could find risk-free investments that were better than dividend-paying stocks. Investments in renewables required large capital expenditures and inflation had put pressure on pricing power. However, in the past few months, AI data centers and crypto-related demand have acted as a tailwind for the utility world. Vistra, one of the biggest energy firms with a diverse portfolio of assets, stands to benefit from this macro environment.
Vistra Corp. (NYSE:VST) detailed during the earnings call for the first fiscal quarter that factors like data center expansions, industrial re-shoring, increased electrification, and population growth were the driving factors behind an increased interest in utilities moving forward. Future pricing forecasts are bullish for the utility sector, and analysts expect Vistra to generate more than $6 billion in 2026 EBITDA, roughly 19% above the upper bound of 2024 guidance range.
7. Super Micro Computer, Inc. (NASDAQ:SMCI)
Number of Hedge Fund Holders: 47
Super Micro Computer, Inc. (NASDAQ:SMCI) develops and manufactures high performance server and storage solutions based on modular and open architecture. The stock has nosedived since the company announced earlier this week that it would not be able to complete the annual 10k filing with authorities in the US. The filing details important business numbers for the fiscal year. The news came on the heels of a report by Hindenburg Research, an investment firm with a focus on activist short selling, that detailed that it had taken a short position on the chip firm because of glaring accounting red flags, evidence of undisclosed related party transactions, sanctions and export control failures, and customer issues.
This bearish view on Super Micro Computer, Inc. (NASDAQ:SMCI) is shared by analysts on Wall Street. Wells Fargo recently lowered the price target on the stock to $375 from $650 and kept an Equal Weight rating, highlighting that the stock was under significant pressure following the announcement that it will not file the fiscal 2024 report on time. In an investor note, the advisory further added that given this uncertainty and concern over revenue recognition, as well as the history of the chipmaker in this regard, the price target reduction was warranted.
6. Microsoft Corporation (NASDAQ:MSFT)
Number of Hedge Fund Holders: 279
Microsoft Corporation (NASDAQ:MSFT) is a Washington-based technology company. Open AI, the company behind ChatGPT, is seeking to raise funding in a new round that would value the startup at more than $100 billion, latest reports indicate. The Wall Street Journal understands that venture capital firm Thrive Capital may lead the funding round and invest close to $1 billion in the company that kickstarted the AI revolution at the back end of 2022. Microsoft has also invested heavily in OpenAI over the past few years, with some estimates placing these bets at around $15 billion. Back in January, the tech giant had invested $10 billion in the AI startup, the largest round of funding for the latter so far.
Microsoft Corporation (NASDAQ:MSFT) is one of the favorite tech stocks on Wall Street. Evercore ISI analyst Kirk Materne recently reiterated an Outperform rating on the shares with a price target of $500, noting that the firm had delivered a solid fiscal Q4 with strong commercial bookings. The analyst further added that there were good signs about the demand signals in the business and forecast Azure growth to accelerate in the second half as more AI capacity came online.
5. Alphabet Inc. (NASDAQ:GOOG)
Number of Hedge Fund Holders: 165
Alphabet Inc. (NASDAQ:GOOG) is a California-based technology company that owns and runs the internet search engine Google. Latest reports indicate that the company will soon release the people generating feature of Gemini, the artificial intelligence assistant. The firm had paused the feature earlier this year due to concerns about how it handled race. This development is important because the feature, not offered by Google competitors so far, will be available to users subscribed to paid Gemini plans, including Gemini Advanced, Business or Enterprise. Google has modified the image-generating model in Gemini for the new launch.
Another exciting development regarding Alphabet Inc. (NASDAQ:GOOG) comes from news agency Reuters. In a recent report, the news agency claims that the tech giant is planning to build a large data center in Vietnam. Data centers are at the heart of the AI revolution sweeping the tech world. So far, no hyper-scaler has announced plans to build a data center outside the US. The Reuters report claims that internal talks on the matter are on and the data center could be ready in 2027.
4. Meta Platforms, Inc. (NASDAQ:META)
Number of Hedge Fund Holders: 219
Meta Platforms, Inc. (NASDAQ:META) engages in the development of products that enable people to connect and share with friends and family through mobile devices, personal computers, virtual reality headsets, and wearables worldwide. A few weeks after announcing that spending on AI and related tech would inch higher in the coming months, the company has revealed plans to shut down an augmented reality (AR) studio to focus investments in other areas. In a recent post, the firm said that the decision is part of a plan to shift resources to the next generation of experiences, across new form factors like glasses.
Earlier this week, Meta Platforms, Inc. (NASDAQ:META) announced that it had signed a deal with Sage Geosystems to receive geothermal energy to support AI data centers in the US. The first phase of this project is expected to be online and operating in 2027. The firm has committed to investing in sustainable energy as the demand for power rises across the US. Meta has contracted over 12,000 MW in renewable energy projects over the past few years.
3. Amazon.com, Inc. (NASDAQ:AMZN)
Number of Hedge Fund Holders: 308
Amazon.com, Inc. (NASDAQ:AMZN) engages in the retail sale of consumer products, advertising, and subscriptions service through online and physical stores in North America and internationally. Latest reports indicate that Chinese companies are getting around US bans on export of products, software, and technology related to AI by targeting American cloud service providers. These cloud firms, including AWS by Amazon, have integrated AI features into their offerings in the past few months as the demand for the new tech rises rapidly. The report, first released by news agency Reuters, claims that Amazon offered Chinese entities access to advanced AI chips and also advanced AI models like Claude.
Following AI-themed changes to virtual assistants by big tech firms like Apple and Google, Amazon.com, Inc. (NASDAQ:AMZN) is reportedly also planning to launch the delayed overhaul of Alexa in October. Per reports, access to the upgraded version of the Alexa assistant, which includes a Smart Briefing feature that offers daily AI-generated summaries of news articles, will require a paid subscription that could cost as much as $10 a month.
2. Apple Inc. (NASDAQ:AAPL)
Number of Hedge Fund Holders: 184
Apple Inc. (NASDAQ:AAPL) is a consumer electronics firm. The company was recently named the top artificial intelligence stock pick going into 2025 by investment bank Citi. In an investor note, the analysts covering AI at the bank highlighted that early developer feedback on iOS 18, the latest software for iPhones, with beta AI features, had been positive, including the recently launched feature to remove unwanted objects with AI. Per the analysts, this would provide consumers with a compelling reason to upgrade their iPhones. The investor note also eased concerns around the transition to a new CFO and the antitrust case against Google, backing the firm to emerge stronger from the challenges.
Latest reports indicate that Apple Inc. (NASDAQ:AAPL) will be cutting around 100 jobs in the services department of the firm amid a shift to new AI priorities. The majority of the job cuts are expected in the Apple Books and Apple Bookstore departments. The move is widely seen as a larger plan by the firm to reorganize around artificial intelligence offerings, the most recent of which was the launch of Apple Intelligence earlier this year.
1. NVIDIA Corporation (NASDAQ:NVDA)
Number of Hedge Fund Holders: 179
NVIDIA Corporation (NASDAQ:NVDA) provides graphics, computing and networking solutions. The company recently posted earnings for the second quarter of 2024, beating market expectations on earnings per share and revenue by $0.04 and $1.3 billion respectively. The guidance numbers for the third fiscal quarter also topped expectations. Multiple concerns about the production ramps of Blackwell, the latest AI chips being marketed by the firm, were also addressed during the earnings call. The CFO revealed that the firm had shipped customer samples of the Blackwell architecture in the second quarter, and the production ramp for the chip was scheduled to begin in the fourth quarter and continue into fiscal 2026.
Following the earnings call, Wall Street analysts have reiterated their bullish calls on NVIDIA Corporation (NASDAQ:NVDA) stock. Raymond James raised the price target on the stock to $140 from $120 and kept a Strong Buy rating, noting that Blackwell delays appeared better than feared and management was forecasting a strong ramp in Q4. The advisory further detailed that Hopper demand continued to be healthy with further growth expected in FQ4.
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 but that trades at less than 5 times its earnings, check out our report about the cheapest AI stock.
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