In this article we discuss Billionaire Steve Cohen’s 10 Large-Cap Stock Picks With Huge Upside Potential.
What does the future hold for the US economy and equities amid punitive tariffs, immigration crackdown and federal spending cuts? That’s the million-dollar question as the chairman and CEO of hedge fund Point72 Asset Management, Steve Cohen, sounds alarm bells warning the US economy could be on the brink amid macroeconomic uncertainties.
The billionaire investor has fired a warning shots, insisting that President Donald Trump’s aggressive trade policy could cause the economy to grow at a much slower rate of 1.5% in the second half of the year, down from an initial growth forecast of 2.5%. The warning comes on Trump touting tariffs for various purposes, including lowering trade imbalances and gaining more negotiating power over other nations. Nevertheless, their negative impact continues as the service sector, a key economic driver, grows slowly from 2023.
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“Tariffs cannot be positive, okay? I mean, it’s a tax,” Cohen said Friday at the FII Priority Summit in Miami Beach, Florida. “On top of that, we have slowing immigration, which means the labor force will not grow as rapidly as … the last five years and so.”
Cohen has warned that the good times that saw the equity market trickle to record highs are over as the US economy’s outlook is uncertain due to the tariff plan laid out by Trump. True to Cohen’s warnings, the US stock market has pulled back significantly from record highs. Given the uncertain macro environment, the S&P 500 is already down by about 8% for the year and on the cusp of entering the correcting phase.
Echoing similar sentiments is Morgan Stanley CIO Mike Wilson, who insists a significant correction has been on the cards since 2023. According to Wilson, investors had pushed stocks upwards, with valuation skyrocketing above historical norms and beyond the value of their fundamentals. Therefore, a rapid descent should be expected as headwinds soar left, right and centre.
“I’m actually pretty negative for the first time in a while,” Cohen said. “It may only last a year or so, but it’s definitely a period where I think the best gains have been had and wouldn’t surprise me to see a significant correction.”
On the other hand, Cohen remains optimistic about the artificial intelligence outlook despite DeepSeek’s revelation and development on the development of cost-effective AI models rattling the US markets. According to Cohen, DeepSeek’s development of cost-effective AI models is positive despite raising concerns about spending on powerful AI chips developed by US companies.
Cohen is one of the billionaire investors taking advantage of the artificial intelligence boom through strategic investments. His portfolio at Point72 Asset Management hedge boasts significant exposure to tech giants developing and leveraging various AI innovations. Likewise, Point72 Asset Management has already unveiled a new artificial intelligence-focused fund that posted a 14% gain in the last three months of 2024 growing to $1.5 billion.
Steven Cohen of Point72 Asset Management
Our Methodology
We combed Point 72 SEC Q4 2024 13F filings to identify billionaire Steve Cohen’s 10 large-cap stock picks with huge upside potential. We focused on stocks with a market cap of more than $40 billion with significant upside potential. We then analyzed the stocks on why they stand out as solid investments well poised to generate significant value even on the overall equity market turning bearish. Finally, we listed the stocks in ascending order of upside potential.
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 373.4% since May 2014, beating its benchmark by 218 percentage points (see more details here).
Billionaire Steve Cohen’s 10 Large-Cap Stock Picks With Huge Upside Potential
10. Microsoft Corporation (NASDAQ:MSFT)
Market Cap as of April 24: $2.78 Trillion
Point72 Asset Management’s Equity Stake: $713.79 Million
Analysts’ Upside Potential as of April 24: 32%
Number of Hedge Fund Holders: 317
Microsoft Corporation (NASDAQ:MSFT) is a multinational technology company that develops and supports a wide range of software, services, devices, and solutions. It also operates in cloud computing, online search, and other online services. While the stock has pulled back significantly on the artificial intelligence-driven run fizzling, Mizuho analyst Gregg Moskowitz believes the company is well-positioned to deliver impressive growth over the long term.
The analyst has a $475 price target on the stock based on the expectation that Microsoft’s cloud unit, Azure, will benefit from public/hybrid cloud migration and digital transformation of complex workflows. Companies and governments widely use the cloud-powered version of Office Microsoft 365, further strengthening the tech giant’s revenue base.
Accordingly, Moskowitz believes Microsoft Corporation (NASDAQ:MSFT) has made significant progress in generative artificial intelligence, as shown by its $14 billion investment in OpenAI and other AI solutions. Azure AI revenue was up by 157% year-over-year in fiscal Q2 2025, accounting for 13% of all Azure revenues. According to the analyst, Wall Street is also underestimating the company’s long-term revenue growth outlook. Microsoft is on course to spend $80 billion on AI data centre infrastructure and chips in 2025 as it looks to capitalize on the AI boom.
9. UnitedHealth Group Incorporated (NYSE:UNH)
Market Cap as of April 24: $389.54 Billion
Point72 Asset Management’s Equity Stake: $190.62 Million
Analysts’ Upside Potential as of April 24: 33.60%
Number of Hedge Fund Holders: 150
UnitedHealth Group Incorporated (NYSE:UNH) is a healthcare company that specializes in health insurance and healthcare services. It offers consumer-oriented health benefit plans and services for national and public sector employers. The company remains under pressure to slash the annual profit forecast, citing higher-than-expected medical costs in the Medicare plan.
UnitedHealth Group Incorporated (NYSE:UNH) already feels the brunt of lower government payments and soaring medical costs. Medical costs are rising as more seniors return to hospitals for procedures they postponed during the pandemic. Consequently, it is forcing companies like UnitedHealth Group to incur more costs. For its first quarter of 2025, UnitedHealth Group reported an adjusted income of $7.20 a share, missing analysts’ estimates of $7.29.
UnitedHealth Group Incorporated (NYSE:UNH) also cut its full-year earnings guidance to between $26 and $26.50 a share from a previous guidance of between $29.50 and $30. Revenue in the quarter was up $9.8 billion year over year to $109.6 billion. TD Cowen has already cut its stock price target to $520 from $609 while maintaining a Buy rating, concerned by rising medical costs that are eating into margins.
8. Amazon.com, Inc. (NASDAQ:AMZN)
Market Cap as of April 24: $1.92 Trillion
Point72 Asset Management’s Equity Stake: $917.68 Million
Analysts’ Upside Potential as of April 24: 37.51%
Number of Hedge Fund Holders: 339
Amazon.com Inc. (NASDAQ:AMZN) is a multinational juggernaut boasting a highly diversified business empire spanning e-commerce, cloud computing, online advertising, and artificial intelligence. It is Steve Cohen’s biggest holding owing to its track record of growth in various segments and its ability to generate shareholder value.
Amazon.com Inc. (NASDAQ:AMZN) is one of the stocks hammered amid the broader stock market rout. The 21% sell-off in 2025 has already caught analyst attention. Raymond James has downgraded the stock to Outperform from Strong Buy and cut the price target to $195 from $275. The cut comes amid growing concerns that soaring macroeconomic headwinds, tariffs and the need to enhance investments in artificial intelligence will negatively impact Amazon’s earnings.
The fact that 30% of Amazon’s first-party gross merchandise volume and 15% of advertising revenue comes from China could pose significant risks, according to Raymond James. Amid the concerns, the tech giant is still well poised to capitalize on the growing demand for artificial intelligence services as a key provider of cloud offerings through Amazon Web Services. Additionally, as e-commerce continues to take a share from brick-and-mortar retailers, Amazon.com Inc. (NASDAQ:AMZN) should be the biggest beneficiary and a leading player in the sector.
7. Taiwan Semiconductor Manufacturing Company Limited (NYSE:TSM)
Market Cap as of April 24: $679.95 Billion
Point72 Asset Management’s Equity Stake: $492.72 Million
Analysts’ Upside Potential as of April 24: 39.05%
Number of Hedge Fund Holders: 186
Taiwan Semiconductor Manufacturing Company Limited (NYSE:TSM) is the world’s largest semiconductor foundry, focusing on chip manufacturing for other companies. Its products are used in a wide variety of applications, including high-performance computing, smartphones, the Internet of Things (IoT), automotive, and digital consumer electronics. While the stock has pulled back significantly, Barclays maintains an Overweight rating, having cut the price target to $215 from $255, concerned by a slowdown in the chip industry.
Taiwan Semiconductor Manufacturing Company Limited (NYSE:TSM) delivered solid first-quarter 2025 results ahead of new US tariffs that have significantly affected the chip industry. Its profit jumped 60% to NT$361.56 billion or $11.16 billion, beating consensus estimates of NT$351.65 billion. Revenue was also up 42% to NT$839.25 billion.
The better-than-expected results come from Taiwan Semiconductor Manufacturing Company Limited (NYSE:TSM) cashing in on the growing demand for artificial intelligence technology. While the company faces the risk of being hit by 100% tax if it does not shift more US production, it has reiterated its full-year outlook. It expects revenue growth to be in the mid-20% range of continued AI development. The company expects its business in 2025 to be supported by strong growth in its 3-nanometer and 5-nanometer technologies.
6. Snowflake Inc. (NYSE:SNOW)
Market Cap as of April 24: $49.24 Billion
Point72 Asset Management’s Equity Stake: $267.35 Million
Analysts’ Upside Potential as of April 24: $39.35%
Number of Hedge Fund Holders: 85
Snowflake Inc. (NYSE:SNOW) is a software application company that provides a cloud-based data platform. The platform includes artificial intelligence (AI) Data Cloud, which enables customers to consolidate data into a single source of truth to drive meaningful business insights. The growing traction of the company’s artificial intelligence-focused applications has helped strengthen the stock’s sentiments on Wall Street.
While Mizuho analysts cut the stock’s price target to $190 from $205 on April 14, they still reiterated a Buy rating. Snowflake Inc. (NYSE:SNOW) is one of the companies benefiting from the robust consumption of artificial intelligence solutions on the cloud. The company’s limited exposure to federal markets is also seen as a positive during heightened economic uncertainties and recession risks.
Snowflake Inc. (NYSE:SNOW) delivered better than expected fourth quarter fiscal 2025 results on booming demand for its artificial intelligence products. Its Q4 2025 earnings per share totalled $0.30 as revenues rose 27% year-over-year to $986.8 million. The Cloud data warehouse company expects revenues of between $955 million and $960 million for its Q1 2026 quarter, representing a growth of between 21% and 22%.
5. Salesforce, Inc. (NYSE:CRM)
Market Cap as of April 24: $240.71 Billion
Point72 Asset Management’s Equity Stake: $297.14 Million
Analysts’ Upside Potential as of April 24: 44.66%
Number of Hedge Fund Holders: 162
Salesforce Inc (NYSE:CRM) is a software application company that provides a Customer Relationship Management (CRM) platform and other business applications. Its solutions help businesses manage customer interactions, automate processes, and improve productivity. The company has deepened investments in enterprise-ready artificial intelligence architecture in its Agentforce offering and strengthened its partnership with Google Cloud.
Nevertheless, Salesforce Inc (NYSE:CRM) has been under pressure, tanking by about 22% as investors increasingly question the company’s artificial intelligence opportunity. Analysts at D.A Davidson downgraded the stock to an underperform from Neutral and cut the price target to $200 from $250 amid concerns about growth in Salesforce legacy products. The departure of the chief operating officer and the appointment of a new chief financial officer also added to investor uncertainty, rattling Salesforce Inc (NYSE:CRM) sentiments in the market. The company providing a 2026 revenue forecast that fell below consensus estimates also rattled investors.
Amid the headwinds, underlying fundamentals have remained resilient, with Salesforce Inc (NYSE:CRM) delivering a 120% year-over-year annual recurring revenue increase in its Data Cloud & AI divisions in Q4 fiscal 2025. Its Q4 2025 revenue was also up 8% year-over-year to $10 billion. The company also raised its quarterly dividend by 4% to $0.42, which is attributed to free cash flow increasing 31% to $12.4 billion, affirming its commitment to returning shareholder value.
4. Adobe Inc. (NASDAQ:ADBE)
Market Cap as of April 24: $150.01 Billion
Point72 Asset Management’s Equity Stake: $333.08 Million
Analysts’ Upside Potential as of April 24: 44.02%
Number of Hedge Fund Holders: 117
Adobe Inc. (NASDAQ:ADBE) is a technology company that develops and sells software and online services for creative tasks, document management, and digital marketing. It is best known for its Creative Cloud suite, which includes tools like Photoshop, Illustrator, and InDesign for graphic design. It is one of the companies that capitalize on artificial intelligence to strengthen its solutions. While AI business accounted for $125 million of $4.23 billion generated in Q1 2025, it is expected to be a key growth driver.
Adobe Inc. (NASDAQ:ADBE) expects revenues in the AI book of business to more than double in 2025, going by the investments it is making. It has already expanded its AI portfolio with Adobe GenStudio and Firefly Services. The company is increasingly monetizing standalone subscriptions in Firefly by introducing various creative cloud offerings. It also plans to invest in its sales capacity as it seeks to strengthen its AI streams.
Adobe Inc. (NASDAQ:ADBE) has already acquired significant stakes in Synthesia, an AI startup serving over 70% of Fortune 100 companies. The startup offers a platform that helps businesses develop videos with AI-generated lifelike avatars. The company has also inked a strategic partnership with the NFL to enhance fan experience using AI technology. Even as Adobe capitalizes on the artificial intelligence boom, RBC Capital has cut the stock’s price target to $480 from $530 while maintaining an Outperform rating setting and competitive pressure in the generative content tool sector.
3. The Walt Disney Company (NYSE:DIS)
Market Cap as of April 24: $157.80 Billion
Point72 Asset Management’s Equity Stake: $345.19 Million
Analysts’ Upside Potential as of April 24: 44.11%
Number of Hedge Fund Holders: 108
The Walt Disney Company (NYSE:DIS) operates as an entertainment company worldwide through three segments: Entertainment, Sports, and Experiences. Amid the diversified entertainment empire, its stock has underperformed the overall market, tanking by about 22% year to date. Nevertheless, Wolfe Research upgraded the stock to an Outperform from Peer Perform and set a price target of $112.
The bullish stance stems from The Walt Disney Company (NYSE:DIS) delivering better than expected first quarter fiscal 2025, underscoring growth in various segments. Disney generated a 5% increase in Q1 2025 revenue to $24.7 billion and a 35% increase in earnings per share to $1.40. The company’s long-term prospects hinge on its direct-to-consumer streaming business led by Disney+, which is in high demand despite the higher subscription prices. The segment saw a 9% increase in revenue to $6.1 billion.
Thanks to significant intellectual property, The Walt Disney Company (NYSE:DIS) is poised to become a streaming giant as it prepares to launch a flagship ESPN streaming service. Disney’s parks, cruises, and consumer products segment are other important growth drivers, given the high barriers to entry into the industry. On the other hand, the linear cable television segment remains under pressure, having suffered a 7% setback in sales as the cord-cutting menace gathers steam on the advent of streaming services.
2. Arista Network Inc. (NASDAQ:ANET)
Market Cap as of April 24: $88.85 Billion
Point72 Asset Management’s Equity Stake: $333.92 Million
Analysts’ Upside Potential as of April 24: 50.40%
Number of Hedge Fund holders: 78
Arista Network Inc. (NASDAQ:ANET) is a computer hardware company that develops markets and sells data-driven, client-to-cloud networking solutions for AI, data centers, campus, and routing environments. It has emerged as a market leader in the provision of connectivity solutions, such as ethernet switches for artificial intelligence.
Consequently, Arista Network Inc. (NASDAQ:ANET) is one of the companies susceptible to Donald Trump’s tariffs, a disadvantage that has taken a significant toll on the stock’s sentiments. The stock is down by about 33% for the year, an underperformance that has seen Evercore ISI cut its price target of the stock to $100 from $130 while reiterating an Outperform rating. The sell rating comes amid growing concerns that Arista Network will feel the full brunt of trade tariffs expected to impact its gross margins.
Amid the growing concerns, Arista Network Inc. (NASDAQ:ANET) boasts of a healthy revenue growth rate of 19.5%. Evercore ISI also expects the company to meet its $750 million back-end AI revenue target and achieve growth targets of as much as 20% in 2025. As US-based hyperscalers double down on artificial intelligence spending, Arista Networks should be one of the biggest beneficiaries.
1. NVIDIA Corporation (NASDAQ:NVDA)
Market Cap as of April 24: $2.51 Trillion
Point72 Asset Management’s Equity Stake: $562.55 Million
Analysts’ Upside Potential as of April 24: 64.04%
Number of Hedge Fund Holders: 223
NVIDIA Corporation (NASDAQ:NVDA) is a technology company that designs and develops the most advanced chip systems and software for artificial intelligence. It also provides graphics computing and networking solutions for data centre computing platforms and end-to-end networking platforms.
NVIDIA Corporation (NASDAQ:NVDA) has been under pressure as the company remains the subject of trade tariffs and export control curbs. Likewise, analysts at Citi have lowered their stock price target to $163 from $150, concerned by a slowdown in data center spending in the US. Rising competition in the AI chip market and a significant increase in manufacturing costs due to trade wars are other headwinds.
Management has already reiterated that new US controls on exports of artificial intelligence chips will cost the company about $5.5 billion. The US government has already informed the company that it will bid for a special license to export its H20 chips made specifically for Chinese markets.
Since 2022, NVIDIA Corporation (NASDAQ:NVDA) has produced a number of specific chips for Chinese clients, including the A800, H800 and the H800’s successor. The company has had to develop Chinese-specific chips to adhere to US regulations that seek to limit China’s access to hardware required for AI innovation. The focus on China does not come as a surprise, as the Chinese market accounted for 13% or $17 billion of Nvidia’s revenue in its fiscal year 2025.
While we acknowledge the potential of NVIDIA Corporation (NASDAQ:NVDA) 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 time frame. There is an AI stock that went up since the beginning of 2025, while popular AI stocks lost around 25%. If you are looking for an AI stock that is more promising than NVDA but that trades at less than 5 times its earnings check out our report about this cheapest AI stock.
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