5 Best Small Cap AI Stocks To Buy Now

In this article, we will be taking a look at the 5 best small cap AI stocks to buy now. To read our detailed analysis, you can go directly to see the 11 Best Small Cap AI Stocks To Buy Now.

5. Mitek Systems, Inc. (NASDAQ:MITK)

Number of Hedge Fund Holders: 15

Market Capitalization: $542.52 million

Mitek Systems, Inc. (NASDAQ:MITK) is an application software company based in San Diego, California. It uses AI to provide mobile image capture and digital identity verification solutions.

There were 15 hedge funds long Mitek Systems, Inc. (NASDAQ:MITK) in the fourth quarter, with a total stake value of $107.5 million.

4. Lemonade Inc. (NYSE:LMND)

Number of Hedge Fund Holders: 16

Market Capitalization: $1.23 billion

On March 4, Keefe, Bruyette & Woods analysts maintained a Market Perform rating and an $18 price target on Lemonade Inc. (NYSE:LMND).

Lemonade Inc. (NYSE:LMND) is a digital property and casualty insurance company. It uses AI to bolster its insurance provision services.

In total, 16 hedge funds held stakes in Lemonade Inc. (NYSE:LMND) in the fourth quarter, with a total stake value of $366 million.

3. Perion Network Ltd (NASDAQ:PERI)

Number of Hedge Fund Holders: 23

Market Capitalization: $1.06 billion

We saw 23 hedge funds long Perion Network Ltd (NASDAQ:PERI) in the fourth quarter, with a total stake value of $162 million.

Perion Network Ltd (NASDAQ:PERI) is an advertising company. It uses AI and machine learning to source and optimize online traffic, among more.

A Buy rating and a $35 price target were maintained on Perion Network Ltd (NASDAQ:PERI) on February 2 by Roth MKM analysts.

Richie Capital Group mentioned Perion Network Ltd (NASDAQ:PERI) in its first-quarter 2023 investor letter:

“Perion Network Ltd. (NASDAQ:PERI) (PERI up +56.4%) – Our investment in the Israeli based ad-tech company has now been a top performer for two quarters in a row. In February, Perion announced full year 2022 earnings which included guidance for 14% revenue and EBITDA growth in 2023. This implies meaningful growth in a challenging environment where their peers continue to struggle. Despite the stock’s strong performance, Perion is still trading at a modest 19x earnings.

In addition to the optimistic growth outlook, Perion seems to be benefiting from anticipation of Bing’s new ChatGPT driven search engine. Bing is Perion’s largest customer. We, along with Perion’s management, believe that the “new Bing” offers a meaningful growth opportunity. The more users convert to Bing, the more publishers will advertise on the platform and drive Perion revenue. On Microsoft’s Q4 earnings call, CFO Amy Hood discussed the impact of growing Bing market share: “every percentage point of share it gains in search equals roughly $2 billion in additional advertising revenue.” It is difficult to envision a scenario where Perion is not a direct beneficiary of Bing’s success…” (Click here to view the full text)

2. Fastly, Inc. (NYSE:FSLY)

Number of Hedge Fund Holders: 23

Market Capitalization: $1.89 billion

RBC Capital analysts maintained a Sector Perform rating and an $18 price target on Fastly, Inc. (NYSE:FSLY) on January 8.

Fastly, Inc. (NYSE:FSLY) had 23 hedge funds long its stock in the fourth quarter, with a total stake value of $83.6 million.

Based in San Francisco, California, Fastly, Inc. (NYSE:FSLY) is an internet services and infrastructure company. Its computing platform allows developers to utilize and migrate AI and neural network workloads closer to their users.

1. Verint Systems Inc. (NASDAQ:VRNT)

Number of Hedge Fund Holders: 27

Market Capitalization: $1.95 billion

Verint Systems Inc. (NASDAQ:VRNT) is an application software company. It offers a conversational AI to help users deliver exceptional customer experiences, among more.

A total of 27 hedge funds were long Verint Systems Inc. (NASDAQ:VRNT) in the fourth quarter, with a total stake value of $299.6 million.

Needham analysts maintained a Buy rating and a $40 price target on Verint Systems Inc. (NASDAQ:VRNT) on January 16.

See also 11 Best Semiconductor Stocks To Invest In for the AI Boom and 50 Funny Things To Ask Chatgpt and Google’s AI Chatbot.