Top 10 Unlikely AI Stocks with Tremendous Upside Potential

3. Datadog, Inc. (NASDAQ:DDOG)

Number of Hedge Fund Holders: 71

Datadog, Inc. (NASDAQ:DDOG) operates an observability and security platform for cloud applications. Its products comprise infrastructure and application performance monitoring, log management and digital experience monitoring. On January 8th, research analysts at Scotiabank reiterated an outperform rating on the stock with a $133 price target.

The upgrade comes amid growing optimism of another good year for the software sector, which is expected to benefit from multiple catalysts, including artificial intelligence. It also comes on  Datadog, Inc. (NASDAQ:DDOG) being named a leader in observability and digital experience monitoring software by consulting firm Gartner. As cloud migration and digital transformation increase the complexity of computing environments, spending in that market is expected to grow at a rate of 12% per year through 2027.

The company is launching new products to satisfy demand, and artificial intelligence (AI), in particular, should be a significant tailwind. LLM Observability, a software module that enables developers to keep an eye on generative AI applications and the large language models (LLMs) that underpin them, was unveiled by Datadog last year.