We recently published a list of Complete List of All AI Companies Under $2 Billion Market Cap. In this article, we are going to take a look at where HIVE Digital Technologies Ltd. (NASDAQ:HIVE) stands against other AI companies under $2 billion market cap.
It’s clear that AI holds immense promise but it comes with significant risks. Some of the concerns that the market has include overreliance on a few key players, shifts in demand toward smaller competitors, and the broader impact of AI-driven market trends on earnings and valuations. While AI offers opportunities, managing risks such as customer concentration, economic headwinds, and market volatility will be crucial for its sustainable growth and integration.
Navigating AI Expectations and Market Dynamics
On CNBC ‘Fast Money,’ a discussion between traders highlighted concerns about elevated expectations for AI, especially in the chip market, with NVDA as a prime example. Past patterns in the semiconductor giant’s stock suggest potential declines, with customer concentration being a significant risk. Some believe demand for high-end chips could shift to smaller semiconductor companies. They also discussed that broader market performance might improve as other sectors gain traction, especially during earnings season, which is expected to influence investor sentiment more than AI and GLP-1 trends.
They mentioned that the key risks for earnings include the strong U.S. dollar, rising rates, and policy uncertainties, which may impact large-cap companies. While recent PPI data offered some relief, the bond market remains firm, with 10-year yields approaching 5%. Expectations for CPI and PCE figures are mixed, with potential reacceleration seen as a headwind for markets in a higher rate environment. Earnings and economic data were considered critical factors to watch by the traders.
Our Methodology
For this article, we scoured our database as well as several ETFs and media reports to find all possible AI stocks under $2 billion. We then listed the stocks in ascending order of their market cap. We also added the hedge fund sentiment around each stock which was 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).
A close-up of hands typing code to facilitate the exchange of Ethereum and Ethereum Classic.
HIVE Digital Technologies Ltd. (NASDAQ:HIVE)
Market Capitalization: $400 Million
Number of Hedge Fund Holders: 7
HIVE Digital Technologies Ltd. (NASDAQ:HIVE) is a leading technology company focused on sustainable blockchain and AI infrastructure, powered by green energy.
On December 23, HIVE Digital (NASDAQ:HIVE) announced the acquisition and deployment of a new cluster of advanced NVIDIA H100 GPUs, along with the latest NVIDIA H200 GPUs, in Quebec, Canada. The $30 million investment strengthens the company’s position as a leader in the global gig economy and supports its dedication to advancing AI and high-performance computing (HPC).
The new supercomputing clusters are expected to open up new revenue streams while aligning with HIVE Digital’s (NASDAQ:HIVE) sustainability goals by using 100% renewable energy. The company projects that, once deployed with customers, the HPC services’ annual revenue run rate will exceed $20 million by Q2 2025, focusing on high-margin cloud computing and AI model training.
Overall, HIVE ranks 24th on our list of the 59 AI companies under $2 billion market cap. While we acknowledge the potential of HIVE 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 HIVE 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.
