We recently compiled a list of the 9 AI Stocks Investors Are Monitoring. In this article, we are going to take a look at where Meta Platforms, Inc. (NASDAQ:META) stands against the other AI stocks.
The European Commission has recently issued guidelines intended to standardize rules across the AI industry in Europe. As reported by Reuters, employers will be banned from using artificial intelligence to track staff’s emotions. Similarly, websites will not be allowed to trick users into spending money. The Artificial Intelligence Act, which has been binding since last year, will be fully applicable on Aug. 2, 2026. The AI Act is deemed the most comprehensive set of rules governing AI globally. Some of these provisions, such as using the internet to create facial recognition databases, have already gone into effect on February 2nd.
“The ambition is to provide legal certainty for those who provide or deploy the artificial intelligence systems on the European market, also for the market surveillance authorities. The guidelines are not legally binding”.
-European Commission official
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Some practices banned under the guidelines include AI-enabled dark patterns embedded in services that are meant to manipulate users into making hefty financial commitments and AI-enabled applications that exploit users based on their age, disability, or otherwise. European Union countries have until Aug. 2 to designate market surveillance authorities to enforce the AI rules, Reuters noted.
The ban also comes with heavy fines, ranging from 1.5% to 7% of a company’s total global revenue, in case of AI breaches. However, the Financial Times has reported that Trump has threatened to target Europe in reaction to fines levied against American companies under the AI Act.
“There is definitely a worry in Brussels that the new U.S. president will raise pressure on the EU around the AI Act to ensure that U.S. companies don’t have to deal with too much red tape or potentially even fines”.
-Patrick Van Eecke, co-chair of law firm Cooley’s global cyber, data and privacy practice.
For this article, we selected AI stocks by going 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).
A team of developers working in unison to create the company’s messaging application.
Meta Platforms, Inc. (NASDAQ:META)
Number of Hedge Fund Investors: 235
Meta Platforms, Inc. (NASDAQ:META) is a global technology company. On February 4th, Argus raised the firm’s price target on the stock to $775 from $686 and kept a “Buy” rating on the shares. Increased advertising revenue and significant margin expansion are coming out to favor Meta, with the latter being a result of robust cash flow and deep cost cuts. Meta has also been racing with tech giants such as Microsoft and Google to develop models and applications before monetization. The market may indeed be taken aback by the company’s ramped-up investments in generative AI. However, the firm pointed out that Meta is already leaning on GenAI to improve targeted advertising. This is one of its critical monetization features, the analyst told investors in a research note.
Overall META ranks 2nd on our list of the AI stocks investors are monitoring. While we acknowledge the potential of META 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 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.
