We recently published a list of 10 AI Stocks to Watch Amid DeepSeek Impact. In this article, we are going to take a look at where Leidos Holdings (NYSE:LDOS) stands against other AI stocks to watch amid DeepSeek impact.
The launch of DeepSeek is drawing new battle lines in the AI competition and many analysts believe the technology investment landscape won’t be the same again after the Chinese breakthrough. Talking to CNBC, Databricks CEO Ali Ghodsi said that DeepSeek would result in “distillation” where companies will make smaller, more efficient models based on the technology:
“So we’re going to just see distillation happening left and right. It’s already happening—like, there’s so many versions of DeepSeek that have been reproduced and redone just in the last week as we speak. So this distillation is going to just create so much competition at the LLM or the AI layer.”
In the coming days, it would be interesting to see how American AI companies tackle this challenge and come up with new products or breakthroughs to maintain their dominance.
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For this article, we picked 10 AI stocks that are trending on the back of latest news. With each stock we have mentioned the number of hedge fund investors. 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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Leidos Holdings (NYSE:LDOS)
Number of Hedge Fund Investors: 34
Shana Sissel from Banríon Capital Management said in a latest program on Schwab Network that Leidos Holdings (NYSE:LDOS) is a promising under-the-radar tech stock for 2025.
“It’s kind of the outlier of the group. It’s a government contractor—defense, healthcare, commercial airlines, cybersecurity, things of that nature. Smaller player in the space, it doesn’t get as much of the headlines as some of its larger peers, but it’s really well-run, has a really solid balance sheet, good leadership, and it just kind of keeps trucking along. I don’t know that most people think of Leidos as a household name, but it should be. If you fly, you go through their machines every time you go through the TSA checks.
So, it’s a very interesting company. I think the number one concern that investors may have with the company has to do with Elon Musk and the Doge team, and how that will affect defense spending. But Leidos has an interesting niche in that a lot of the services they provide are much more critical outside of just general defense. I think that it is actually going to do quite well even in an environment where there’s increased scrutiny on defense spending. But the stock has come back a little bit as a result of those concerns.”
Overall, MU ranks 10th on our list of AI stocks to watch amid DeepSeek impact. While we acknowledge the potential of Meta Platforms, Inc. (NASDAQ:META), our conviction lies in the belief that under the radar 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 META but that trades at less than 5 times its earnings, check out our report about the cheapest AI stock.
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Disclosure: None. This article is originally published at Insider Monkey.
