AI is rapidly making its way into our lives, from the recent introduction of DeepSeek courses in Chinese universities to intelligent robots patrolling public places in the US for enhanced safety.
While there are countless benefits of using AI across global industries around productivity, efficiency, and adaptability, concerns about the misuse of the evolving technology continue to grow in tandem. The dual-use potential of AI has led to increased scrutiny of the technology, especially in Europe, which experts believe is imposing stringent regulations even if it means slow development across the region.
Former Google CEO Eric Schmidt warned that AI misuse poses an “extreme risk” and could do catastrophic harm because the technology could be weaponized by “rogue states” to negatively impact innocent people.
“The real fears that I have are not the ones that most people talk about AI. I talk about extreme risk…Think about North Korea, or Iran, or even Russia, who have some evil goal… they could misuse it and do real harm,” Schmidt cautioned. “My experience with the tech leaders is that they do have an understanding of the impact they’re having, but they might make a different values judgement than the government would make.”
Weaponization could range from deepfakes to autonomous weapons, which Schmidt believes can be prevented with a balanced approach that fosters innovation through appropriate regulations.
We selected AI stocks by reviewing news articles, stock analysis, and press releases. We listed the stocks in ascending order of their hedge fund sentiment taken from Insider Monkey’s database of 900 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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9. Knightscope Inc. (NASDAQ:KSCP)
Number of Hedge Fund Holders: N/A
Knightscope Inc. (NASDAQ:KSCP) develops AI technologies for advanced detection systems like the Blue Light Emergency Communication Devices and Automated Gunshot Detection Services alongside autonomous security robots. These robots use cutting-edge laser systems and sensors to enhance public safety by patrolling areas like corporate campuses and shopping malls. These intelligent robots can track suspicious activities and alert authorities to report security incidents.
On February 20th, Knightscope Inc. (NASDAQ:KSCP) announced offering its emergency communication devices integrated with the Knightscope Emergency Management System to the City of Kilingly in Connecticut for seamless communication in emergencies to improve response times with minimal service disruption. The City College of San Francisco is increasing its deployment of K1 Blue Light Tower emergency phones, while Southern California Regional Rail Authority is expanding the use of Knightscope’s emergency call boxes for public safety in high-traffic environments. The company also announced the completion of its fleet-wide upgrade, replacing operational K5 v3 Autonomous Security Robots with the enhanced K5 v5 model for elevating safety in sectors like retail, commercial real estate, hospitality, and corporate campuses.
8. Xiao-I Corp. (NASDAQ:AIXI)
Number of Hedge Fund Followers: N/A
Xiao-I Corp. (NASDAQ:AIXI) is a cognitive intelligence company offering a multitude of AI-powered business solutions focused on fostering industrial digitization. The company’s proprietary AI technologies are used in smart cities, data asset management, construction support platforms, and customer service devices.
On February 21st, Xiao-I Corporation (NASDAQ:AIXI) launched the tAIkbox 1 device in the US powered by AI and the company’s Hua Zang LLM. The product is expected to transform customer services across high-impact industries like hospitality, healthcare, travel, and retail through seamless and intuitive interactions. It can integrate with existing phone and computer systems with data cables and has the potential to recognize natural speech better, anticipate requirements swiftly, and respond with finesse.
7. ConnectM Technology Solutions Inc. (NASDAQ:CNTM)
Number of Hedge Fund Followers: 3
ConnectM Technology Solutions Inc. (NASDAQ:CNTM) integrates energy assets with its AI-powered tech platform and combines service networks and strategic partnerships to offer clean energy solutions for residential, light commercial buildings, and all-electric OEMs.
On February 21st, ConnectM Technology Solutions Inc. (NASDAQ:CNTM) announced a preliminary revenue guidance of $11.3 million for Q1 2025, implying a 100% YoY jump from $5.7 million. The company attributed the growth projections to expanded customer acquisitions, higher operational efficiency, and strong demand for AI-driven technology such as the proprietary Automotive Graphics Visual Unit and new-age heat pumps.
“Our Q1 2025 guidance reflects the relentless execution of our team and the scalability of our electrification platforms in a rapidly evolving market. Achieving 100% year-over-year growth—a milestone that parallels our record-breaking Q4 2024 performance—demonstrates the power of our vertically integrated approach and the trust our customers place in ConnectM. As we enter 2025, we are not only building on this momentum but also positioning the Company for sustained value creation through innovation and strategic partnerships.”
-said Bhaskar Panigrahi, CEO of ConnectM Technology Solutions Inc.
6. Faraday Future Intelligent Electric Inc. (NASDAQ:FFIE)
Number of Hedge Fund Followers: 7
Faraday Future Intelligent Electric Inc. (NASDAQ:FFIE) leverages AI and a proprietary variable platform architecture to develop, manufacture, and sell “TechLuxury” electric vehicles. The company is also involved in designing autonomous driving and intelligence systems within its intelligent mobility ecosystem.
On February 21st, Faraday Future Intelligent Electric Inc. (NASDAQ:FFIE) stated that its FF China subsidiary shipped two FX 6 camouflaged prototype mules to customs, marking progress in their journey to the company’s Los Angeles headquarters. The FX 6 is a part of the company’s strategy to offer Advanced Intelligent Electric Vehicles (AIEVs) to a mass-market audience. The two prototypes will be subjected to further testing and validation aimed at enhancing ADAS, powertrain, intelligent cabin and user experience.
5. Grid Dynamics Holdings Inc. (NASDAQ:GDYN)
Number of Hedge Fund Followers: 15
Grid Dynamics Holdings Inc. (NASDAQ:GDYN) offers technology consulting, product engineering, and advanced analytics services through a leadership specializing in enterprise AI to assist companies in successfully undergoing business transformation.
On February 20th, the company posted a 14.7% YoY jump in Q4 revenue to $100.3 million, driven by high demand for its services. Non-GAAP net income also increased YoY to $10.3 million or $0.12 per share from $0.10. For the full year 2024, total revenues increased 12% YoY to $350.6 million. Based on these record numbers, Grid Dynamics Holdings Inc. (NASDAQ:GDYN) set revenue guidance between $98 million and $100 million for Q1 2025.
“2025 is off to a great start with increasing demand for our services across our customer base. With this confidence, we are providing full-year 2025 revenue guidance, projecting 20% growth over 2024. To achieve our growth aspirations, we have identified and put into action five key priorities. These include leveraging our strengths in AI and Data, increasing the number of accelerators and technology artifacts, expanding industry diversification, scaling our delivery locations according to our “Follow-the-Sun” model, and deepening our partnerships…Our AI initiatives continue to gain significant traction across our customer base, and during the quarter our pipeline of AI opportunities grew to more than 130, representing a 30% increase from last quarter.”
-said Leonard Livschitz, CEO of Grid Dynamics Holdings Inc.
4. Consensus Cloud Solutions Inc. (NASDAQ:CCSI)
Number of Hedge Fund Followers: 16
Consensus Cloud Solutions Inc. (NASDAQ:CCSI) offers leading digital cloud fax technology and interoperability services using AI and secure data exchange to automate workflows, improve operation efficiencies, and transform digital information for regulated industries like healthcare, financial services, insurance, real estate, and manufacturing.
On February 20th, Consensus Cloud Solutions Inc. (NASDAQ:CCSI) announced it will showcase its leading eFax Corporate platform, AI-powered Clarity data extraction tool, and the interoperability platform Unite at the HIMSS25 in Las Vegas between March 3rd and 6th. The company will demonstrate how its comprehensive product suite eliminates communication gaps, speeds up referrals, streamlines administrative workflows, and lowers overheads while supporting improved patient outcomes in an interoperable healthcare ecosystem.
“A recent survey of healthcare leaders revealed that breakdowns in communication and care coordination continue to impact providers. As the industry continues its digital transformation journey, closing communication gaps is more critical than ever. Applying advanced interoperability solutions to digital cloud fax offers a practical, low-risk, and cost-effective path to improving data exchange and seeing a tangible return on investment without the complexities of a complete system overhaul. We’re looking forward to presenting these innovations at HIMSS.”
-said Scott Turicchi, CEO of Consensus Cloud Solutions Inc.
3. Pony AI Inc. (NASDAQ:PONY)
Number of Hedge Fund Followers: 20
Pony AI Inc. (NASDAQ:PONY) leverages its full-stack, vehicle-agnostic Virtual Driver technology combined with its proprietary software and hardware offerings to sustainably drive large-scale commercialization of autonomous mobility for diverse transportation use cases.
On February 21st, Pony AI Inc. (NASDAQ:PONY) announced that it became the first company to launch paid robotaxi services between China’s high-demand routes: the Guangzhou city center, Guangzhou Baiyun International Airport, and the Guangzhou South Railway Station. The development is expected to benefit residents and tourists with efficient autonomous travel options and fares similar to the city’s standard taxi rates.
“Our latest expansion in Guangzhou marks another major step in making autonomous mobility a part of everyday life. By offering autonomous rides from the heart of the city to key transit hubs, we’re providing practical, real-world services which meet the needs of travellers and city residents alike, solidifying Pony.ai’s status as a global leader in the large-scale commercialization of autonomous mobility.”
-said Dr. James Peng, co-founder and CEO of Pony AI Inc.
2. RingCentral Inc. (NYSE:RNG)
Number of Hedge Fund Followers: 36
RingCentral Inc. (NYSE:RNG) offers AI-powered business communications, contact centers, video, and hybrid event solutions to empower businesses with conversation intelligence for better customer and employee engagement and, subsequently, improved business outcomes.
On February 20th, the company introduced an AI-based phone agent called RingCentral AI Receptionist. This agent leverages GenAI to automatically respond to customer queries, accurately route calls, deliver SMS confirmations, and offer call transcripts. Businesses can easily deploy this AI call automation solution.
“The launch of RingCentral AI Receptionist marks our foray into agentic AI and the creation of a new category in AI-powered business call handling. RingCentral AIR is designed to work right out of the box, enabling any business, from local service providers to fast-growing enterprises, to automate customer interactions. Voice remains a preferred way in which customers communicate, and AI-powered call automation—integrated directly into the phone system—will redefine how companies of all sizes connect with their customers.”
-said Kira Makagon, President & COO of RingCentral Inc.
1. Accenture Plc (NYSE:ACN)
Number of Hedge Fund Holders: 79
Accenture Plc (NYSE:ACN) offers diverse services for agile transformation, data analytics, intelligent automation, AI, and software engineering. The technology company is striving to accelerate R&D and deployment of AI agents using Nvidia’s (NASDAQ:NVDA) AI offerings for faster placement of multi-agent networks for seamless integration into enterprise systems. It is also upgrading its core banking modernization capabilities via platform acquisitions, enabling data unification from legacy and modern banking architectures for product development.
On February 20th, Accenture (NYSE:ACN) announced that it invested in Voltron Data, which develops software to advance accelerated computing that underpins modern AI applications. The investment will enable Voltron Data to help organizations leverage advanced computing technology to expedite large-scale analytics used for GenAI and machine learning applications.
“Banks are sitting on an enormous amount of trapped data with the potential to fuel the next generation of AI-powered products and services. Through its Theseus software, Voltron Data can enable banks and others to unlock their data and then quickly move, scale and analyze it in a way that is both cost-effective and sustainable. It’s like transforming a one-lane road into a multi-lane highway.”
-said Michael Abbott, Banking & Capital Markets industry group lead at Accenture Plc.
While we acknowledge the potential of Accenture Plc (NYSE:ACN) as an investment, our conviction lies in the belief that 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 ACN but that trades at less than 5 times its earnings, check out our report about the cheapest AI stock.
READ NEXT: 20 Best AI Stock To Buy Now and Complete List of All AI Companies Under $2 Billion Market Cap.
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