In this piece, we will take a look at the Top 12 Trending AI Stocks on Latest News and Ratings.
Donald Trump is turning out to be the spark to take artificial intelligence investments to new heights. Just days after repealing an executive order to regulate AI risks, the US president unveiled a $500 billion private sector initiative. Stargate is the project that underscores how companies are racing against time to position themselves amid the AI revolution.
“The Stargate Project is a new company which intends to [build] new AI infrastructure for OpenAI in the United States,” OpenAI, Oracle, and SoftBank said in a joint statement. “This project will not only support the re-industrialization of the United States but also provide a strategic capability to protect the national security of America and its allies.”
The new AI initiative, which includes several leading AI developers, including ChatGPT creator OpenAI, paves the way for the construction of data centres needed to power and support various AI models. With Goldman Sachs estimating that AI will represent 19% of data center power demand by 2028, tech giants are racing to construct and secure data center compute capacity.
The growing investment comes amid significant technological advancements made in AI, especially in machine learning and generative AI models like ChatGPT. Investments are expected to soar as companies look to gain a front seat amid the revolution and strengthen their competitive edge. However, it’s unclear if these investments will pay off proportionately.
The cost of training a single frontier AI model is rising exponentially, from $1,000 in 2017 to almost $200 million in 2024. The increase comes amid consistent returns to scale in AI model training data, compute capacity, and model complexity. Even though unit costs per computing operation have rapidly decreased over the same period, costs could still reach billions of dollars by 2030. By the middle of the 2030s, the hardware costs of the world’s AI infrastructure might surpass $1 trillion.
Amid the escalating cost concerns, physical artificial intelligence has emerged as the next frontier of AI investing. Companies are increasingly investing in robotics makers, auto suppliers and specialty semiconductor companies.
The AI technology began with search bots and has since advanced to “agentic AI,” which includes research assistants and customer support agents. Investors examining the cutting edge of this technology are now concentrating on interactions in the real world with autonomous devices that use artificial intelligence, such as self-driving cars, drones, and robot nurses.
“As you go into 2025, agentic AI is that next inflection point here before you hit that physical AI moment … like with everything else in the world, you have to crawl before you can walk and then run,” said CFRA senior equity analyst Angelo Zino
The soaring investments around AI have also given rise to exciting investment opportunities. Likewise, investors are increasingly jostling for positions in tech giants and little-known companies with exposure to revolutionary technology.
A business executive in a modern office looking over reports detailing artificial intelligence.
Our Methodology
For this article, we selected AI stocks by going through news articles, stock analysis, and press releases. These stocks are also popular among hedge funds.
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Top 12 Trending AI Stocks on Latest News and Ratings
12. Lumen Technologies, Inc. (NYSE:LUMN)
Number of Hedge Fund Holders: 26
Lumen Technologies, Inc. (NYSE:LUMN) is a communication services company that provides integrated products and services to business and residential customers. The stock’s sentiments have received a significant boost amid reports that the company is well positioned to benefit from the $500 billion Stargate project announced by Donald Trump on January 22nd.
The new artificial intelligence infrastructure investment spearheaded by Oracle, OpenAI and Softbank seeks to accelerate the development of data centers in the US over the next five years. The three companies will kickstart the Stargate project with a $100 billion investment in domestic data centers.
Lumen Technologies, Inc. (NYSE:LUMN) seems set to benefit from the deal, given that it has already inked a strategic data centres partnership with Microsoft and Meta Platforms. Microsoft is one of the companies also associated with the Stargate project. The Stargate project is expected to fuel demand for Lumen’s private connectivity fabric PCF solutions.
11. GLOBALFOUNDRIES Inc. (NASDAQ:GFS)
Number of Hedge Fund Holders: 22
GLOBALFOUNDRIES Inc. (NASDAQ:GFS) is a semiconductor foundry company that provides a range of mainstream wafer fabrication services and technologies worldwide. It manufactures various semiconductor devices, including microprocessors and mobile application processors. After going down by about 81% in 2024, the company has set sights on AI opportunities in the automotive, aerospace, defense and communications sectors.
GLOBALFOUNDRIES unveiled plans on January 17th to create a new center for advanced packaging and testing of US-made essential chips. The chips to be manufactured at a New York Facility are supported by investments from the State of New York and the US Department of Commerce.
As artificial intelligence (AI) advances, silicon photonics, 3D, and heterogeneously integrated (HI) chips are being used more frequently to satisfy data center and edge device power, bandwidth, and density requirements. Additionally, silicon photonics chips are positioned to meet the power and performance requirements of critical infrastructure applications such as radar, communications, and automobiles. GLOBALFOUNDRIES Inc. (NASDAQ:GFS) is positioning its New York manufacturing facility to meet the growing demand.
10. Cognizant Technology Solutions Corporation (NASDAQ:CTSH)
Number of Hedge Fund Holders: 39
Cognizant Technology Solutions Corporation (NASDAQ:CTSH) is a professional services company that provides consulting technology and outsourcing services. The company has set out to empower businesses to transform their business processes using AI. Consequently, it has unveiled the Neuro® AI Multi-Agent Accelerator and Multi-Agent Service Suite.
The two new offerings should accelerate the development and adoption of AI agents. In return, businesses should be able to make divisions in real time and offer personalized customer experiences. Additionally, on January 21st, Cognizant Technology Solutions Corporation (NASDAQ:CTSH) confirmed the extension of its strategic partnership with food service retailer McDonalds. The renewed agreement will focus on leveraging cutting-edge technology, including artificial intelligence, to enhance staff enablement, customer experience, and operational efficiency.
In addition to innovations in Cloud, Enterprise AI, and Generative AI, which are all backed by extensive domain expertise in the Food Services sector, the agreement seeks to leverage Cognizant Technology Solutions Corporation (NASDAQ:CTSH) product expertise, digital engineering, and distinctive quality assurance services.
9. Fortinet, Inc. (NASDAQ:FTNT)
Number of Hedge Fund Holders: 47
Fortinet, Inc. (NASDAQ:FTNT) is a technology company that provides cybersecurity and convergence of networking and security solutions worldwide. On January 23rd, Rosenblatt Securities increased its price target on the stock to $115 from the previous $100 while maintaining a Buy rating. The upgrade comes amid expectations that the company will deliver robust fourth-quarter results amid growing demand for AI-powered cybersecurity solutions.
The global firewall market was up by 6.7% in the third quarter of last year as companies and businesses raced to protect their networks from cybersecurity attacks. Fortinet, Inc. (NASDAQ:FTNT) is increasingly capitalizing on the growing adoption of next-gen firewalls (NGFWs), which upgraded traditional firewalls with more network filtering services. Additionally, it has diversified its endpoint security services with cloud and AI platforms to fend off stiff competition.
As one of the leading providers of cybersecurity solutions, Fortinet, Inc. (NASDAQ:FTNT) is well-positioned to benefit from a flurry of high-profile hacking incidents. Additionally, integrating AI into the company’s solution is another factor driving the stock’s momentum in the market.
8. CyberArk Software Ltd. (NASDAQ:CYBR)
Number of Hedge Fund Holders: 51
CyberArk Software Ltd. (NASDAQ:CYBR) is the global leader in identity security. Centered on intelligent privilege controls, it provides the most comprehensive security offering for any human or machine identity across business applications, distributed workforces and hybrid cloud environments. Analysts at KeyBanc affirmed their positive market sentiment on the company on January 21st by raising the price target to $400 from $355 while maintaining an Overweight rating.
KeyBanc analysts remain confident about CyberArk Software Ltd.’s (NASDAQ:CYBR) prospects in the identity market, especially in integrating CyberArk Privileged Access Manager (PAM) and Microsoft Defender for Identity. With the integration, organizations stand to enjoy a comprehensive view of their entire identity security landscape for a quicker, more effective threat response.
Security Operations Center (SOC) and Identity teams will gain deeper investigative capabilities by connecting data from various systems, including more thorough remediation options, more accurate attack path identification, and faster and more efficient threat-hunting efforts. Increased cyber resilience is made possible by these combined capabilities.
7. Digital Realty Trust, Inc. (NYSE:DLR)
Number of Hedge Fund Holders: 52
Digital Realty Trust, Inc. (NYSE:DLR) brings companies and data together by delivering the full spectrum of data center, colocation, and interconnection solutions. After gaining 30% in 2024, analysts at UBS upgraded the stock to a Buy on January 7th and raised the price target to $205 from $147.
The upgrade occurs against a backdrop of ongoing demand for enterprise, hyperscale, AI solutions, and anticipated power and space limitations. These elements support a favourable demand and pricing environment for Digital Realty Trust, Inc. (NYSE:DLR). With a record backlog of almost $900 million and over $1 billion in bookings over the past 12 months, the data center REIT provides insight into its future growth trajectory.
Digital Realty Trust, Inc. (NYSE:DLR) is staring at tremendous opportunities as high data center demand should result in a favorable pricing environment. Analysts expect Digital Realty to deliver mid-single-digit growth on its Core Funds From Operations (FFO) per share in 2025 and accelerate in the following years. The growth should bolster the balance sheet, its leverage having reduced to approximately 5x by the end of 2024.
6. Cadence Design Systems, Inc. (NASDAQ:CDNS)
Number of Hedge Fund Holders: 53
Cadence Design Systems, Inc. (NASDAQ:CDNS) provides worldwide software, hardware, services, and reusable integrated circuit (IC) design blocks. On January 21st, the company reached an agreement to acquire Secure-IC, a prominent provider of embedded security IP platforms. The acquisition is poised to strengthen the company’s IP portfolio while addressing the growing need for integrated security in electronic systems across various industries.
Additionally, the acquisition should complement the company’s silicon-proven IP offerings, which include interface artificial intelligence, machine learning, and DSP solutions. Cadence Design Systems, Inc.’s (NASDAQ:CDNS) current IP offerings, which range from protocol controllers and AI accelerators to supporting clients using different processor architectures, will present mutually beneficial synergistic go-to-market opportunities. After the deal closes, the two are well-positioned to grow internationally, provide customers with more value, and develop the next wave of embedded cybersecurity solutions for intricate silicon systems and chipsets.
5. Synopsys, Inc. (NASDAQ:SNPS)
Number of Hedge Fund Holders: 53
Synopsys, Inc. (NASDAQ:SNPS) is a technology company that provides electronic design automation software products used to design and test integrated circuits. Wells Fargo analyst Joseph Quatrochi maintained a Hold rating on the stock on January 13th, with a $540 price target. While the stock was down by 2% in 2024, it has moved to reinvigorate its growth metrics with a focus on artificial intelligence.
Consequently, it has initiated a strategic collaboration with SiMa.ai to pursue growth opportunities in the auto industry. SiMa.ai and Synopsys, Inc. (NASDAQ:SNPS) are joining forces to accelerate the development of workload-specific silicon and software needed to power artificial intelligence-enabled features in next-generation automobiles. For maximum customization of IP, subsystems, chipsets, and SoCs, the solution will integrate Synopsys’s best-in-class EDA, automotive-grade IP, and hardware-assisted verification solutions.
Advanced driver assistance systems (ADAS) and in-vehicle infotainment (IVI) are becoming important differentiators for automakers. With the help of the partnership with SiMa.ai, automotive companies can now modernize their hardware/software to meet the demand for sophisticated, in-car experiences that are becoming more and more expensive to deliver.
4. Palo Alto Networks, Inc. (NASDAQ:PANW)
Number of Hedge Fund Holders: 64
Palo Alto Networks, Inc. (NASDAQ:PANW) is a leading cybersecurity vendor offering comprehensive platforms and services backed by artificial intelligence. Its stock is experiencing an upward trend in the aftermath of analysts at Citigroup reiterating a Buy rating on the stock on January 17th.
The buy rating comes amid expectations that Palo Alto Networks, Inc.’s (NASDAQ:PANW) will enjoy robust growth as its market share in the cybersecurity sector increases. The stock is expected to more than double in the next five years, driven by a 17% compound annual growth rate in free cash flow. Supporting the estimates is the fact that the company is increasingly investing in AI-powered solutions.
Palo Alto Networks, Inc. (NASDAQ:PANW) is increasingly investing in AI and attracting strong interest going by the $100 million plus deal with UK Home Office. Over the last ten years, the company has developed into a more complete security platform, incorporating machine learning and artificial intelligence (AI/ML) capabilities into a growing range of cloud-based products. The company’s Precision AI framework aims to transform cybersecurity by detecting and responding to threats on its own.
3. CrowdStrike Holdings, Inc. (NASDAQ:CRWD)
Number of Hedge Fund Holders: 74
CrowdStrike Holdings, Inc. (NASDAQ:CRWD) is a leading provider of cybersecurity solutions. It offers corporate endpoint and cloud workload security, managed security, security and vulnerability management solutions. While the stock was up by 22% in 2024, analysts at Citigroup believe it possesses significant upside potential. On January 17th, the analysts reiterated a Buy rating on the stock and increased the price target to $420 from $400.
The increase comes amid growing optimism that demand for advanced AI-powered security solutions will soar in 2025, and CrowdStrike Holdings, Inc. (NASDAQ:CRWD) is one company well poised to benefit. CrowdStrike should benefit as spending on cybersecurity dominates IT budgets in key areas of Secure Access Service Edge (SASE), Security Information and Event Management (SIEM), and cloud security. CrowdStrike has already inked a strategic partnership with Cognizant Technology Solutions to improve cybersecurity for global enterprises across industries.
2. Oracle Corporation (NYSE:ORCL)
Number of Hedge Fund Holders: 91
Oracle Corporation (NYSE:ORCL) offers products and services that address enterprise information technology environments worldwide. On January 17th, Cantor Fitzgerald initiated coverage of the stock with an overweight rating and a $214 price target. The bullish rating stems from the company’s strong position in the data management sector and the growth of artificial intelligence capabilities.
Additionally, it comes on the heels of Oracle Corporation (NYSE:ORCL) teaming up with Softbank and Japanese Conglomerate Softbank to build multiple data centres for AI in the US. Under the Stargate project, the trio will begin with a large data center in Texas, which is expected to expand to other states as part of a $500 billion venture.
The data centres could end up housing chips designed by OpenAI to develop an AI chip for running models that could be available as early as 2026. The company is reportedly actively assembling a team of chip designers and engineers and collaborating with semiconductor companies TSMC and Broadcom.
1. Salesforce, Inc. (NYSE:CRM)
Number of Hedge Fund Holders: 116
Salesforce, Inc. (NYSE:CRM) is a software application company that provides Customer Relationship Management (CRM) technology that brings companies and customers together. While the company has been at the forefront of integrating artificial intelligence into its offerings, Bank of America believes the stock has significant upside potential.
On January 23rd, Bank of America reiterated an optimistic outlook, reiterating that Salesforce, Inc. (NYSE:CRM) is well positioned to benefit from its new AI offering, Agentforce. Additionally, an increased spending environment on software should strengthen the company’s revenue base. While the company posted an 8% increase in sales in the third quarter, Bank of America is projecting a 12% to 13% increase by the second half of 2026.
Sales growth should be driven by a software spending cycle showing recovery signs. Regarding Agentforce’s possible contribution, BofA projects that, under ideal circumstances, the new AI-powered service could increase subscription revenue growth by 2% by the second half of FY26.
As we acknowledge the growth potential of Salesforce, Inc. (NYSE:CRM), our conviction lies in the belief that AI stocks hold great promise for delivering high returns and doing so within a shorter timeframe. If you are looking for an AI stock that is more promising than CRM 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 was originally published at Insider Monkey.
