We recently compiled a list of the 11 AI News and Ratings You Shouldn’t Miss. In this article, we are going to take a look at where Qualys, Inc. (NASDAQ:QLYS) stands against the other AI stocks.
DeepSeek has quickly gained attention in AI with its R1 model, which delivers high performance at a lower cost. The company has introduced innovations to improve efficiency and accessibility in AI development. DeepSeek’s fast growth, despite having a small team, shows the increasing trend of AI-driven businesses scaling with minimal human resources. Its success also shows the broader shift toward open-source AI models, especially in China, where competition is driving faster innovation and more cost-effective solutions.
UBS’s Insights on DeepSeek R1 and AI Investment Strategies
In a report posted by UBS on January 31, the UBS CIO analyzed the impact of DeepSeek’s R1 model on financial markets and AI investment strategies. The firm expects continued capital spending by hyperscalers, benefiting semiconductor companies, and recommended diversified exposure across AI’s value chain. The declining cost of training large language models is driven by algorithmic advancements and hardware improvements, with R1 increasing AI adoption. Hardware scaling also remains important alongside algorithmic progress to support AI infrastructure investments.
In addition, China continues to play a significant role in AI innovation, with companies like Alibaba developing competitive models. UBS maintained a positive view of Chinese internet firms due to their ability to offer customizable, cost-effective AI solutions. The firm also highlighted the rise of AI-driven startups, emphasizing investment in firms with proprietary data or strong customer retention.
Furthermore, the rapid development of AI software suggests prioritizing physical infrastructure investments over traditional software. AI’s ability to self-improve introduces unpredictability, leading UBS to recommend structured products for volatility exposure while avoiding non-physical assets lacking a competitive advantage.
UBS believes that despite fluctuations, AI investment remains solid, with major tech firms expected to increase capital spending in 2025. AI adoption is also rising, supporting cloud growth and monetization. While volatility may be there due to economic and regulatory factors, AI’s long-term outlook remains positive, with both high-cost and low-cost models expected to coexist.
For this article, we selected AI stocks by reviewing news articles, stock analysis, and press releases. We listed the stocks in ascending order of their hedge fund sentiment 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).
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Qualys, Inc. (NASDAQ:QLYS)
Number of Hedge Fund Holders: 27
Qualys, Inc. (NASDAQ:QLYS) provides cloud-based IT security and compliance solutions, helping organizations manage cyber risks and protect digital assets.
On February 6, Qualys reported Q4 results with non-GAAP EPS of $1.60, exceeding estimates by $0.23, and revenue of $159.19 million, up 10.1% year-over-year. The company introduced the Risk Operations Center for real-time cybersecurity risk management and highlighted strong MITRE ATT&CK results for its Endpoint Detection and Response solution. For Q1 2025, revenue is projected between $155.5 million and $158.5 million, with non-GAAP EPS expected to range from $1.40 to $1.50. Full-year 2025 revenue guidance is set between $645 million and $657 million, with non-GAAP EPS expected between $5.50 and $5.90.
Qualys management said that the company has expanded its platform from vulnerability scanning to a comprehensive risk analytics and quantification solution. The evolution enables seamless integration with existing security tools while providing full visibility, risk scoring, and AI-driven orchestration across an organization’s attack surface. Some major improvements in 2024 included the introduction of TruRisk Eliminate for extended remediation, improved asset management using patent-pending technology, and integration of the MITRE ATT&CK prioritization matrix for proactive threat response. The company also launched TotalAI to secure generative AI applications and strengthen its TotalCloud CNAPP platform with multi-cloud ITSM integration.
Overall QLYS ranks 7th on our list of AI stocks in news that investors shouldn’t miss. While we acknowledge the potential of QLYS 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 QLYS 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.