We recently published a list of 7 lesser-known, under-the-radar AI stocks hedge funds are piling into. Since Amphenol is part of the list, the stock deserves a deeper look.
The AI-led stock rally that rewarded mega-cap technology stocks has finally started to trickle down to other industry players that were seemingly not related to the AI and tech industry. Consider this: The information technology sector gained about 11% over the past three months, while the S&P 500 utilities sector jumped 18% in the same period. Why? Because investors are scrambling to pile into utilities since they are set to benefit from the dramatic rise in power demand thanks to the data center boom caused by the mass AI adaption. As Nvidia’s CEO Jensen Huang put it in the company’s latest earnings call, the “next industrial revolution” has started with the dawn of AI and across the globe data centers are being “converted into AI factories.”
Photo by Mohamed Hadji on Unsplash
AI-Led Stock Market Boom: “No Longer Dependent on Just One Stock”
A Wall Street Journal report recently quoted Nadia Lovell, senior U.S. equity strategist, global wealth management at UBS, who said that the market is “no longer dependent on just one stock” when it comes to AI as she sees a “broadening out of the AI trade.”
Insider Monkey’s research backs this notion. Our research recently unlocked several AI stocks that are better than mega-cap AI stocks with soaring valuations. If you are looking for an AI stock that is as promising as Microsoft but that trades at less than 5 times its earnings, check out our report about the cheapest AI stock.
For this article we first conducted thorough research to see which lesser-known companies are offering products and services set to see demand in the AI revolution. These companies included firms making hardware, software, infrastructure and backend products necessary for mass AI deployment and consumption. From these companies we chose 7 stocks with the highest 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).
Amphenol Corporation (NYSE:APH)
Number of Hedge Fund Investors: 51
Connecticut-based Amphenol Corporation (NYSE:APH) makes electronic components, fiber optic connectors, cable and interconnect systems. It’s one of the best under-the-radar AI stocks to buy according to experts since Amphenol Corporation (NYSE:APH) would see a boost in demand for its products as more and more companies deploy data centers and AI infrastructure. The stock has gained about 40% so far this year.
Last month, BofA updated its US 1 List, which contains buy-rated US stocks the firm is recommending. Amphenol Corporation (NYSE:APH) is part of the list. Evercore also added the stock to its Tactical Outperform list ahead of the companies’ quarterly results. Amphenol Corporation (NYSE:APH), which also pays a $0.22 per share quarterly dividend, smashed analyst estimates for its Q1 results, reporting a 95 revenue growth in the period to $3.26 billion.
Of the 919 hedge funds tracked by Insider Monkey, 51 hedge funds tracked by Insider Monkey reported owning stakes in Amphenol Corporation (NYSE:APH), up from 41 hedge funds in the previous quarter.
Amphenol Corporation (NYSE:APH) ranks 3rd in Insider Monkey’s list of the 7 Best Under-The-Radar AI Stocks Hedge Funds are Buying.
If you are looking for an AI stock that is as promising as Microsoft 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.