In this article, we discuss the 35 trending AI stocks on latest analyst ratings and news.
As the earnings season unfolds, investors are eager to see how artificial intelligence (AI) investments among S&P 500 companies are yielding results. Analysts anticipate profit growth to decelerate, with S&P 500 earnings projected to rise by 5.3% compared to the same quarter last year, down from a 13.2% increase in the second quarter, per a report by news agency Reuters. The technology and communication services sectors are expected to show the strongest year-over-year growth, with technology earnings forecasted to increase by 15.4% and communication services by 12.3%. AI-related firms have dominated earnings narratives since last year, driving substantial market gains. The S&P 500 is currently at record highs, having risen approximately 21% year-to-date, largely fueled by robust performance in the tech and communication sectors.
Read more about these developments by accessing 10 Unsexy AI Stocks According to Goldman Sachs and 10 Buzzing AI Stocks According to Goldman Sachs.
Howard Chan, CEO of Kurv Investment Management, noted that analysts are keen to evaluate how major companies monetize their AI initiatives, with those succeeding in this regard being notably rewarded. Meta, for instance, experienced a surge in share prices after projecting strong sales growth, suggesting that its digital ad revenue is effectively funding its AI investments. Conversely, the expenditures of giants like Google on AI technologies have raised questions regarding their integration with existing business models. With the S&P 500 trading at 22.3 times future 12-month earnings estimates, surpassing its long-term average of 15.7, many investors hope that this quarter’s earnings will justify higher stock valuations. Solita Marcelli from UBS Global Wealth Management expressed optimism that upcoming third-quarter results could catalyze further gains, particularly as the semiconductor sector remains a focal point for AI investment.
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.
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Our Methodology
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).
Trending AI Stocks on Latest Analyst Ratings and News
35. Iron Mountain Incorporated (NYSE:IRM)
Number of Hedge Fund Holders: 24
Iron Mountain Incorporated (NYSE:IRM) is a real estate investment trust that focuses on storage and information management services. Barclays analyst Brendan Lynch recently raised the price target on the stock to $133 from $91 and kept an Overweight rating on the shares. After the stock’s 70% year-to-date rally, the investment firm reassessed Iron Mountain’s valuation, growth prospects and long-term guidance targets. It concluded the Asset Lifecycle Management business can lead the next leg of share price appreciation. Barry Hytinen, CFO of the company, shared insights at the Goldman Sachs 2024 Communacopia and Technology Conference regarding their data center operations. He highlighted the firm’s significant role as a trusted partner to the largest hyperscalers in the market, with ample growth opportunities in the sector. Hytinen revealed that the company is currently operating 265 megawatts of data center capacity, which is leased out at an impressive 96% to 97% occupancy rate. In addition, the firm has another 305 megawatts of capacity under construction, reflecting its commitment to expanding its presence in the fast-growing data center space.
34. DigitalBridge Group, Inc. (NYSE:DBRG)
Number of Hedge Fund Holders: 24
DigitalBridge Group, Inc. (NYSE:DBRG) is an infrastructure investment firm specializing in digital infrastructure assets. JPMorgan analyst Richard Choe recently raised the price target on the stock to $23 from $22 and kept an Overweight rating on the shares. The advisory said the enormous demand for hyperscale data centers is driving the overall market and a secondary impact to colocation. Cloud and digital transformation demand is robust from enterprise customers, which are still evaluating their artificial intelligence needs, the investment firm told investors in a research note. JPMorgan sees Digital Realty and DigitalBridge as the best ways to play the AI data center trend.
33. 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. TD Securities recently raised the price target on the stock to $68 from $61 and kept a Buy rating on the shares. While Celestica is appreciated for its success with arterial intelligence compute servers, its communications business is not well understood, the advisory told investors in a research note. The investment firm said that as a leading data center networking equipment vendor, the company will be a major beneficiary of continued AI infrastructure investments, ethernet gaining market share, and an increasing mix of 800G equipment. TD increased its 2025 communications revenue estimate by 12% for Celestica due to volume growth, a higher total addressable market, increased AI networking investments, and higher selling prices.
32. Digital Realty Trust, Inc. (NYSE:DLR)
Number of Hedge Fund Holders: 44
Digital Realty Trust, Inc. (NYSE:DLR) brings companies and data together by delivering the full spectrum of data center, colocation, and interconnection solutions. HSBC recently upgraded the stock to Hold from Reduce with a price target of $160, up from $124. The advisory said operational momentum for Equinix and Digital Realty are set to improve significantly in 2025. Data center demand has far outstripped supply in 2024, due to strong artificial intelligence-driven demand and constrained supply in major markets, yet the stocks have underperformed, the advisory told investors in a research note. HSBC said Digital Realty’s pricing environment looks strong in the next two years.
31. 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 stock has been on a significant upward trajectory this year, gaining over 160% year-to-date and outpacing the S&P 500 by nearly 140%. The company’s strong second-quarter earnings showcased sustainable growth, driven by its AI-powered data integration and analytics platforms. These platforms serve both government and commercial sectors, positioning the firm to gain increasing attention from enterprise investors in both public and private markets. Wedbush recently raised the price target on the stock to $45 from $38 and maintained an Outperform rating on the shares.
30. Juniper Networks, Inc. (NYSE:JNPR)
Number of Hedge Fund Holders: 45
Juniper Networks, Inc. (NYSE:JNPR) designs, develops, and sells network products and services worldwide. The company is positioning itself in the AI market through the development and promotion of networking and cybersecurity solutions. Its stock price has surged after receiving regulatory approval for acquisition by Hewlett Packard Enterprise. HPE aims to leverage the company’s AI expertise to tap into the growing AI market, with the deal valued at nearly $14 billion. Juniper has carved out a niche in the AI sector by taking a broader approach, emphasizing network automation and expanding into various market segments to ensure long-term growth. Unlike some of its competitors, such as Arista Networks, which are more concentrated on the increasing demand for high-speed data center networks and cloud computing, Juniper integrates AI technology across a wide spectrum of services, allowing it to differentiate itself in the market.
29. SBA Communications Corporation (NASDAQ:SBAC)
Number of Hedge Fund Holders: 45
SBA Communications Corporation (NASDAQ:SBAC) is a leading independent owner and operator of wireless communications infrastructure including towers, buildings, rooftops, distributed antenna systems, and small cells. As companies implement AI systems and edge computing technologies to process large volumes of data in real time, SBA’s extensive network of towers and infrastructure becomes essential in facilitating the low-latency communication that these systems require. SBA’s towers are also critical for enabling 5G networks, which are important for AI applications in sectors like autonomous vehicles, smart cities, and IoT devices. Barclays recently raised the price target on the stock to $256 from $236 and kept an Equal Weight rating on the shares.
28. Coherent Corp. (NYSE:COHR)
Number of Hedge Fund Holders: 47
Coherent Corp. (NYSE:COHR) develops, manufactures, and markets engineered materials, optoelectronic components, and devices worldwide. The company boasts a long-standing leadership in the optoelectronics market, with over two decades of experience driving innovations across telecom networks, enterprise data centers, and web hyperscalers. One of its standout AI products is the 800G transceiver, which enables data processing speeds of 800 gigabytes per second, making it crucial for managing the high-speed data demands of AI-driven tasks. During the company’s third-quarter earnings call, CEO Chuck Mattera emphasized the strong demand for 800G transceivers, which contributed to a 50% sequential growth in the firm’s non-GAAP earnings per share. Mattera also forecast that AI-related growth will continue to boost earnings into the fourth quarter of 2024 and throughout 2025.
27. 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 company recently announced the release of a new range of servers, GPU-accelerated systems, and storage servers equipped with AMD EPYC 9005 Series processors and AMD Instinct MI325X GPUs. This new H14 product line is one of the most comprehensive in the industry, featuring a variety of high-performance systems, including Hyper systems, Twin multi-node servers, and AI inferencing GPU systems, all of which are available with either air or liquid cooling options. The H14 series is built on AMD’s Zen5 architecture, which incorporates AVX-512 vector instructions for improved CPU-based AI inference capabilities. According to Supermicro, the architecture delivers 17% better instructions per cycle (IPC) compared to the 4th-generation EPYC processors, allowing for enhanced performance per core.
26. KLA Corporation (NASDAQ:KLAC)
Number of Hedge Fund Holders: 55
KLA Corporation (NASDAQ:KLAC) markets process control and yield management solutions for the semiconductor industry. The company is strategically positioned to benefit from the CHIPS Act, a US legislative effort focused on boosting domestic semiconductor manufacturing. This initiative aligns well with the company’s role in supplying critical technologies for chip production, including wafer inspection systems for advanced nodes. In the final quarter of fiscal 2024, the company’s AI-related services revenue reached $614 million, marking a 4% sequential increase and a 14% year-over-year growth. Richard Wallace, the CEO of the firm, highlighted during the Q4 earnings call that long-term growth drivers — such as advancements in foundry logic, ongoing technology scaling, and increasing capital intensity — remain strong for the company. He also projected a recovery in the memory markets by 2025, spurred by developments in AI, high-bandwidth memory, and improvements in the overall supply-demand balance.
25. Equinix, Inc. (NASDAQ:EQIX)
Number of Hedge Fund Holders: 56
Equinix, Inc. (NASDAQ:EQIX) is a California-based real estate trust that operates data centers and other technology assets. The company recently announced a joint venture with GIC, a sovereign wealth fund from Singapore, and the Canada Pension Plan Investment Board to raise over $15 billion in capital. This investment aims to expand the company’s footprint of hyperscale data centers in the US. Hyperscale data centers, known for their enormous size and capacity, are primarily developed by major technology companies in the US. These facilities provide immense networking power and often require electricity consumption on par with that of a large city or even a small country. This venture underscores the significant role such data centers will play in the future of AI, cloud computing, and digital infrastructure.
24. NRG Energy, Inc. (NYSE:NRG)
Number of Hedge Fund Holders: 56
NRG Energy, Inc. (NYSE:NRG) operates as an energy and home services company in the United States and Canada. The company is positioning itself as a key player in the AI landscape due to its production and sale of electricity, which is essential for powering the AI needs of both businesses and consumers. Notably, electricity demand in North America has surged for the first time in nearly four decades. During the first quarter earnings call, Larry Coben, the CEO of the energy firm, emphasized that trends in electrification, coupled with the anticipated growth of generative AI data centers, signal a transformative increase in power demand. He remarked that these developments put the company on track to achieve its target of 15% to 20% growth in free cash flow.
23. Analog Devices, Inc. (NASDAQ:ADI)
Number of Hedge Fund Holders: 64
Analog Devices, Inc. (NASDAQ:ADI) designs, manufactures, tests, and markets integrated circuits (ICs), software, and subsystems products. The company has caught the attention of Wall Street analysts amid the ongoing AI boom. Following a recent selloff in the semiconductor sector, concerns have emerged regarding the return on investment (ROI) for AI capital expenditures. However, investment advisory firm Citi has sought to alleviate these worries by reaffirming a Buy rating on the stock. Citi forecasts that semiconductor companies will achieve a 14% year-on-year growth in sales, despite recent challenges and a period of inventory replenishment.
22. Arista Networks, Inc. (NYSE:ANET)
Number of Hedge Fund Holders: 65
Arista Networks, Inc. (NYSE:ANET) engages in the development, marketing, and sale of data-driven, client to cloud networking solutions for data center, campus, and routing environments. Citi recently named the company as one of the primary DCI providers expected to benefit from increased data center capital expenditures in the coming months. Citi analysts claimed that the increase in DCI spend could lead to the networking firm increasing revenue by as much as 25% year over year in 2025. Much of this growth is expected to stem from Ethernet switching in artificial intelligence networks, per the investment firm. Citi increased its price target on the stock to $460 from $385 and maintained its Buy rating.
21. Constellation Energy Corporation (NASDAQ:CEG)
Number of Hedge Fund Holders: 71
Constellation Energy Corporation (NASDAQ:CEG) generates and sells electricity in the United States. UBS recently raised the price target on the stock to $307 from $230 and kept a Buy rating on the shares. The advisory highlighted that Constellation had announced a contract with Microsoft to provide long-term, dedicated power from the restarted Crane plant, and the broad implications from the announcement are a reaffirmation of the demand for power from large technology companies and the willingness to pay up for access to large quantities of clean energy. Per the advisory, this is another signaling event in the power demand thesis that demonstrates a very supportive fundamental backdrop for power.
20. Amphenol Corporation (NYSE:APH)
Number of Hedge Fund Holders: 72
Amphenol Corporation (NYSE:APH) specializes in designing, manufacturing, and marketing electrical, electronic, and fiber optic connectors. The company offers a broad portfolio of products aimed at AI-focused firms, including chipsets, networking equipment, and solutions for servers and GPUs. It also supplies high-speed power connectors for data centers that handle AI computations for major software companies. This rising demand for AI technologies has led to a 56% organic growth in datacom sales during the second quarter. The company is planning to increase capital investments in the coming months to meet the expanding order volume from AI-driven clients. Adam Norwitt, CEO of the firm, highlighted the surge in bookings between March and June during the company’s Q2 earnings call. Norwitt noted that AI-powered IT datacom clients significantly drove the demand, with traditional datacom orders seeing a modest increase as well.
19. Intel Corporation (NASDAQ:INTC)
Number of Hedge Fund Holders: 75
Intel Corporation (NASDAQ:INTC) markets key technologies for smart devices. Latest reports indicate that Inflection AI, a prominent artificial intelligence startup, has joined forces with Intel to develop a new hardware solution designed for running large language models (LLMs). This collaboration will bring to market an appliance as part of Inflection for Enterprise, a comprehensive package that also includes cloud-based AI services. Founded in 2022, Inflection AI has garnered significant financial backing, raising $1.3 billion from investors to launch its ChatGPT alternative, Pi. The company’s path took a major turn earlier in 2024 when Microsoft hired Inflection co-founder and CEO Mustafa Suleyman to lead its consumer AI group. Alongside this talent acquisition, Microsoft recruited a large part of Inflection AI’s workforce and licensed its AI models in a deal reportedly worth $650 million.
18. 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 a major player in the semiconductor industry and has consistently outperformed its peers financially. Over the past decade, its revenue has surged by nearly 350%, highlighting its strong growth trajectory. Looking ahead, consensus revenue estimates project continued growth, with revenue expected to climb from approximately $27 billion in fiscal 2024 to over $37 billion by fiscal 2028. This upward trend is largely driven by the rapid expansion of AI technologies, which present significant opportunities for the company. JPMorgan analyst Harlan Sur claims the firm is well-positioned to benefit from multiple upcoming technology inflections, enabling it to outperform the wafer fab equipment sector over the next few years.
17. ASML Holding N.V. (NASDAQ:ASML)
Number of Hedge Fund Holders: 81
ASML Holding N.V. (NASDAQ:ASML) makes and sells advanced semiconductor equipment systems. Barclays recently lowered the price target on the stock to EUR 1,100 from EUR 1,150 and kept an Overweight rating on the shares. The advisory updated estimates for its European technology hardware and semiconductors coverage ahead of the Q3 reports. TSMC is its preferred name and Barclays would continue to buy ASML and BE Semiconductor on any weakness. The investment firm expects further cuts to consensus estimates for Infineon and STM. It also prefers Ericsson to Nokia in the quarter in telecom equipment.
16. Lam Research Corporation (NASDAQ:LRCX)
Number of Hedge Fund Holders: 84
Lam Research Corporation (NASDAQ:LRCX) markets semiconductor processing equipment. Citi recently lowered the price target on the stock to $893 from $990 and kept a Buy rating on the shares. The advisory updated its semiconductor equipment sector view and believes the equipment group is heading into a mid-cycle correction in the first half of 2025. While server artificial intelligence demand remains strong, consumer demand across PCs, smartphones, and auto appears lackluster, the advisory told investors in a research note. Citi cut estimates and, accordingly, lowered price target by 10%.
15. Dell Technologies Inc. (NYSE:DELL)
Number of Hedge Fund Holders: 88
Dell Technologies Inc. (NYSE:DELL) designs, develops, manufactures, markets, sells, and supports various comprehensive and integrated solutions, products, and services. Deutsche Bank analyst Matt Niknam recently maintained a Buy rating on the stock with a price target of $144. In an investor note, the analyst highlighted that the company’s ongoing momentum in AI servers — with the enterprise segment picking up — as well as a recovery in the traditional server market, should help the company over the medium and long term. The analyst added that the firm was well positioned to capitalize on the next legs of AI growth/proliferation across enterprises, given its product scale, breadth of services/solutions and go to market footprint.
14. GE Vernova Inc. (NYSE:GEV)
Number of Hedge Fund Holders: 92
GE Vernova Inc. (NYSE:GEV) is an energy company that engages in the provision of various products and services that generate, transfer, orchestrate, convert, and store electricity. JPMorgan analyst Mark Strouse recently raised the price target on the stock to $285 from $240 and kept an Overweight rating on the shares. Given the company already preannounced Q3 EBITDA, the investment firm views the December 10 investor event as a relatively larger catalyst for the stock. Expectations are elevated with the stock 101% since the spinoff and the new long-term financial targets to be issued at the December 10 event could potentially disappoint if management continues with its cadence of setting conservative targets, the advisory told investors in a research note. However, JPMorgan believes GE Vernova remains a key beneficiary of the US electric load growth theme, which is still very early in the cycle. It believes that macro announcements and backlog growth could provide additional visibility into both the company’s revenue and margin upside in 2027 and beyond.
13. Vertiv Holdings Co (NYSE:VRT)
Number of Hedge Fund Holders: 92
Vertiv Holdings Co (NYSE:VRT) designs, manufactures, and services critical digital infrastructure technologies and life cycle services for data centers, communication networks, and commercial and industrial environments. Evercore ISI recently raised the price target on the stock to $125 from $105 and kept an Outperform rating on the shares. The liquid cooling market is rapidly evolving as data center needs for higher server densities continue to escalate, said the advisory, which views Vertiv as uniquely positioned to tackle both the power and thermal management demands associated with AI data centers. The investment firm, which thinks that not just total GW needed to run data centers will go higher, but also the content per MW for Vertiv, anticipates an acceleration in both sales and margin over the next few years.
12. Vistra Corp. (NYSE:VST)
Number of Hedge Fund Holders: 92
Vistra Corp. (NYSE:VST) operates as an integrated retail electricity and power generation company. RBC Capital recently raised the price target on the stock to $141 from $105 and kept an Outperform rating on the shares. The company’s repurchase of the minority interest in Vision seemed compelling, even before the news of a new nuclear deal announced between Constellation Energy and Microsoft, which has re-rated nuclear asset values higher, the investment firm told investors in a research note. RBC added that it sees meaningful tailwinds driving power demand, with no signs of abating.
11. QUALCOMM Incorporated (NASDAQ:QCOM)
Number of Hedge Fund Holders: 100
QUALCOMM Incorporated (NASDAQ:QCOM) develops and sells foundational technologies for the wireless industry. KeyBanc recently downgraded the stock to Sector Weight from Overweight without a price target. The investment firm said its previous thesis was that QUALCOMM would be increasingly viewed as an edge artificial intelligence play given its positioning in handsets and PCs. However, given these end markets have yet to materialize in any meaningful manner, the chipmaker is unlikely to benefit from a replacement cycle fundamentally or being given a market premium as an edge AI beneficiary until that happens, the advisory told investors in a research note.
10. Advanced Micro Devices, Inc. (NASDAQ:AMD)
Number of Hedge Fund Holders: 108
Advanced Micro Devices, Inc. (NASDAQ:AMD) operates as a semiconductor manufacturer. The company recently announced plans to begin mass production of its latest artificial intelligence chip, the MI325X, by the fourth quarter of this year, marking a push to strengthen its position in the AI chip market, currently dominated by NVIDIA. This new chip, set to compete with NVIDIA offerings, is expected to be a significant upgrade over previous AMD models. In addition to the MI325X, AMD revealed plans to launch its next-generation MI350 series chips in the second half of 2025. These upcoming chips will feature a greater amount of memory and a new architecture designed to deliver significantly enhanced performance compared to the current MI300X and MI250X models.
9. Micron Technology (NASDAQ:MU)
Number of Hedge Fund Holders: 120
Micron Technology (NASDAQ:MU) makes and sells memory and storage products. Stifel analyst Brian Chin recently maintained a Buy rating on the stock, stressing that the advisory’s thinking post-Micron earnings last month had not changed despite Samsung Electronics providing a preliminary Q3 earnings update and guiding to revenue and operating profit that was below analyst consensus. The analyst views Samsung’s weakness as more self-inflicted and/or known near-term market headwinds into year-end, where Samsung tends to have higher relative exposure, while adding that it sees leaders remaining focused on advanced technology spending while controlling supply through a near-term lull in the cycle. The investment firm sees the results reinforcing the need for Samsung and Micron to prioritize advanced technology node migrations/ spending, thus putting a competitive gap between themselves and China.
8. Broadcom Inc. (NASDAQ:AVGO)
Number of Hedge Fund Holders: 130
Broadcom Inc. (NASDAQ:AVGO) supplies semiconductor and infrastructure software solutions. Cantor Fitzgerald recently raised the price target on the stock to $225 from $200 and kept an Overweight rating on the shares into Q3 earnings season. The investment firm sees a tale of two classes in semis, those levered to the traditional semi cycle, and those levered to the secular AI story, the advisory told investors in a research note, adding that at the same time, the fundamental backdrop has deteriorated over the last three months, and the vision of an elongated cycle remains well intact. Broadcom is a favorite in AI, Cantor said.
7. 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 recently announced plans to construct two additional fabrication plants (fabs) in Kaohsiung, Taiwan, increasing its total number of facilities in the region to five, according to a report by Data Center Dynamics. These fabs, labeled P4 and P5, are currently in the planning stages, with environmental assessments expected to commence soon. The city’s mayor initially disclosed these developments. The announcement follows TSMC’s earlier plan to build a third 2nm fab at the Nanzih Technology Industrial Park, a 238-hectare site in Kaohsiung. Construction is already underway for P1, with mass production anticipated to begin next year. P2 and P3 are in progress, but construction has faced delays due to extensive soil reclamation and cleanup efforts required after the land, previously occupied by a state-owned oil refinery, was repurposed for the new fabs.
6. 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. Bank of America recently maintained a Buy rating with a $206 price target on the stock. In a research note, the investment firm detailed that a recent DOJ court filing was weighing on the stock but claimed that the initial proposed set of remedies regarding the Google breakup were generally in line with investor expectations. The advisory, which anticipates more twists and turns in the case ahead, also saw positives, including its belief that Google was well-positioned in the search market, Google’s counter proposals in December were likely provide a more positive potential outcome, and limited layoffs so far compared to peers gave the company’s new CFO a positive cost basis set up to drive EPS growth.
5. NVIDIA Corporation (NASDAQ:NVDA)
Number of Hedge Fund Holders: 179
NVIDIA Corporation (NASDAQ:NVDA) provides graphics, computing and networking solutions. Morgan Stanley has an Overweight rating and $150 price target on the stock. After having hosted NVIDIA CEO Jensen Huang, CFO Colette Kress and other members of the management team for a three day non-deal roadshow, Morgan Stanley said the meetings highlighted both the magnitude and length of the accelerated computing runway and every indication from management is that we are still early in a long term AI investment cycle. Blackwell systems NVL36/72 remain the best solution for inference interactions requiring substantially more computation and the Blackwell ramp is progressing on schedule with that product sold out for the next 12 months, pointing to continued strong conditions, said the advisory.
4. Apple Inc. (NASDAQ:AAPL)
Number of Hedge Fund Holders: 184
Apple Inc. (NASDAQ:AAPL) is a consumer electronics firm. Piper Sandler recently maintained a Neutral rating on the shares with a price target of $225. In an investor note, the advisory said it surveyed about 13,500 teens as a part of the firm’s Taking Stock with Teens Fall 2024 survey, and based on the responses, it continued to believe the stock was fairly valued at current levels, as the data did not suggest a 2024 super cycle. However, Piper noted upgrade expectations were up from the 20% level in its Spring 2024 survey. In addition, only about 30% of teens were upgrading any of their Apple hardware in the next six months due to Apple Intelligence, which to the firm felt low given the enthusiasm. Piper acknowledged that the average iPhone among teens was about 3 generations behind the iPhone 16, meaning these older models could just be due for an upgrade.
3. 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. Truist analyst Youssef Squali recently raised the price target on the stock to $650 from $570 and kept a Buy rating on the shares. The advisory expects the company’s Q3 results to come in at the high end of guidance of 13%-20% for revenue growth amid sustained social ad demand and higher CPM. Meta’s AI investments also continue to drive better ranking and recommendation results for users and advertisers, the advisory added.
2. Microsoft Corporation (NASDAQ:MSFT)
Number of Hedge Fund Holders: 279
Microsoft Corporation (NASDAQ:MSFT) is a Washington-based technology company. Goldman Sachs recently lowered the price target on the stock to $500 from $515 and kept a Buy rating on the shares. The investment firm slightly lowered free cash flow expectations after Microsoft’s fiscal 2026 and 2027 artificial intelligence capex estimates. However, as Azure capacity comes online and AI revenue continues to scale, Microsoft should execute well against Goldman’s expectations for 14% revenue growth, the advisory told investors in a research note. The investment firm said Microsoft’s earnings growth is still 300 basis points faster than the S&P 500, which justifies the stock’s valuation.
1. Amazon.com, Inc. (NASDAQ:AMZN)
Number of Hedge Fund Holders: 308
Amazon.com, Inc. (NASDAQ:AMZN) operates as a technology conglomerate with core interests in the ecommerce business. Truist analyst Youssef Squali recently raised the price target on the stock to $265 from $230 and kept a Buy rating on the shares. The advisory detailed that Amazon’s North America revenue was tracking to consensus estimates, reflecting a resilient consumer, sustained growth in advertising revenue, faster growth at Web Services and higher operating margins year-over-year. This came even as the company invested aggressively in artificial intelligence, AWS, logistics and Project Kuiper, the advisory told investors in a research note. Truist said Amazon remained its favorite mega cap as the company continued to gain share of global e-commerce and improved its value proposition to both merchants and consumers. It was also one of the best ways to play cloud, AI, digital ads and global logistics, contended the advisory, which moved the price target to fiscal 2025 from 2024.
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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