US tech giants appear unfazed by the success of China’s cheap alternative AI models like DeepSeek as they announced roadmaps to invest billions of dollars this year in AI.
On February 10th, US equity features rose, hinting at a rebound from steep losses on February 7th as markets absorbed Donald Trump’s intentions to impose 25% tariffs on all US steel and aluminum imports.
“Risky assets are getting a bit desensitized to Trump’s tariff announcement,” said Mohit Kumar at Jefferies. “Our view in tariffs remains that they will cause volatility, are a negotiating tool and will eventually be not as bad as feared. However, we do see scope for further volatility over the coming weeks, with Europe likely to be the next target.
The gains in US stock futures could signal several buyers seeking to return to the market after the 1% retreat in the S&P 500 late last week.
Elsewhere, TSMC, the biggest contract chipmaker globally, said today that its Q1 revenue could hover at the lower end of its guidance due to $161 million in losses induced by earthquakes in January. Before DeepSeek’s launch, the company stated that its CapEx could touch $42 billion in 2025 due to AI demand.
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.
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9. Richtech Robotics Inc. (NASDAQ:RR)
Number of Hedge Fund Holders: 1
Richtech Robotics Inc. (NASDAQ:RR) designs, manufactures, and sells AI-powered service robots to drive automation in service industries, including hospitality and healthcare.
On February 10th, Richtech Robotics Inc. (NASDAQ:RR) announced the launch of its new food and beverage brand, Clouffee & Tea, featuring its AI-powered robot barista, ADAM, at Town Square in Las Vegas. ADAM is powered by AI tech from Nvidia, which helps it detect customer presence, engage in conversation, take orders verbally, and prepare beverages.
8. Faraday Future Intelligent Electric Inc. (NASDAQ:FFIE)
Number of Hedge Fund Holders: 3
Faraday Future Intelligent Electric Inc. (NASDAQ:FFIE) uses AI and its proprietary variable platform architecture to design, manufacture, and market “TechLuxury” electric vehicles. The company also develops autonomous driving and intelligence systems within its intelligent mobility ecosystem.
On February 10th, Faraday Future Intelligent Electric Inc. (NASDAQ:FFIE) announced that FF China will ship two FX 6 prototype mules, which will be branded as “FX 6 Series” models, to its Los Angeles headquarters this month. The move implies a step further in the FX brand’s plan to bring affordable mass-market AIEVs to the marketplace. The prototype shipment is also the official beginning of the development and testing phase for this model in the US.
7. Bit Digital Inc (NASDAQ:BTBT)
Number of Hedge Fund Holders: 6
Bit Digital Inc. (NASDAQ:BTBT) offers a global platform for digital asset production, such as Bitcoin mining, as well as high-performance computing (HPC) infrastructure, while prioritizing sustainable energy sources. The company’s Bit Digital AI segment offers cloud infrastructure services for GenAI workstreams tailored to clients’ requirements.
On February 10th, Bit Digital Inc. (NASDAQ:BTBT) announced it secured a colocation contract with a top AI hardware innovator. The company will provide the client with 5 MW of built-to-suit data center infrastructure for five years through its HPC business, WhiteFiber, which includes cloud services and its data center platform, Enovum Data Centers. The agreement is expected to formally commence in mid-2025 and be fulfilled at a data center within Enovum’s proprietary development pipeline.
6. Ecarx Holdings Inc. (NASDAQ:ECX)
Number of Hedge Fund Holders: 15
ECARX Holdings Inc. (NASDAQ:ECX) uses AI to develop automotive technology, including software, computing platforms, and system-on-a-chip (SoC) modules to accelerate innovation in software-defined vehicles for safer driving. The company’s AI-powered offerings help in ADAS development, sensing, decision-making, and predictive modeling to assist in the creation of full-stack solutions for EVs.
On February 10th, the company announced an upgrade to its ECARX AutoGPT in-vehicle AI large model application with the integration of the DeepSeek-R1 model for a faster, more secure, and customized user experience. This move expands AutoGPT’s local processing capabilities and elevates its reasoning and decision-making accuracy for automotive-specific application scenarios.
5. Nokia Oyj (NYSE:NOK)
Number of Hedge Fund Holders: 16
Nokia Oyj (NYSE:NOK) is a leading networking, software, and hardware provider. The company uses AI in threat detection to automate complex processes and incident response, fortify network security, and enhance customer services facilitated by faster decision-making.
On February 10th, Nokia Oyj (NYSE:NOK) named Intel Corp.’s (NASDAQ:INTC) current head of data center and AI Group, Justin Hotard, as the company’s next president and CEO, effective April 1st. He will replace current CEO Pekka Lundmark, who informed the board of his decision to step down from the helm. However, Lundmark will continue as Hotard’s advisor until the end of 2025.
4. Mobileye Global Inc. (NASDAQ:MBLY)
Number of Hedge Fund Holders: 33
Mobileye Global Inc. (NASDAQ:MBLY) designs and markets hardware and software solutions for driver-assistance systems (ADAS) and autonomous driving technologies for better mobility infrastructure and hands-off driving facilitated by new-age safety features like real-time detection of road users, geometry, and marking.
On February 10th, Bank of America analyst John Murphy upgraded Mobileye Global Inc. (NASDAQ:MBLY) to “Neutral” from “Underperform” and raised the stock price target to $19 from $12. The brokerage stated that despite 2025 guidance remaining below consensus estimates, downside risk to estimates is limited. The analyst highlighted potential 2025 catalysts from contract wins with several automakers in the later stages of contract negotiations for its AI-powered SuperVision system, Surround advanced driver-assistance systems (ADAS), and autonomous driving technologies.
3. NetApp Inc. (NASDAQ:NTAP)
Number of Hedge Fund Holders: 38
NetApp Inc. (NASDAQ:NTAP) is a data infrastructure company that offers unified data storage and management services, focusing on hybrid cloud environments and cloud integration. The company’s NetApp AI suite enables the management of large and diverse datasets, which is critical for efficiently handling AI workloads for better computing performance and training AI models across various environments.
On February 10th, Susquehanna downgraded NetApp Inc. (NASDAQ:NTAP) to “Neutral” from “Positive” and reduced its stock price target to $130 from $155. The brokerage sees heightened downside risk to consensus estimates, particularly in the July and October quarters, as it doesn’t see enterprise AI helping with incremental demand until 2026. The brokerage believes NetApp Inc. (NASDAQ:NTAP) has increased market share but it is now reflected in the stock’s valuation.
2. NXP Semiconductors NV (NASDAQ:NXPI)
Number of Hedge Fund Holders: 44
NXP Semiconductors NV (NASDAQ:NXPI) is a global semiconductor manufacturer that designs microcontrollers, application processors, and security controllers to provide secure connectivity for embedded applications. The company offers its products to diverse industries, including mobile communications, consumer electronics, security applications, and automotive.
On February 10th, NXP Semiconductors NV (NASDAQ:NXPI) announced it would acquire Kinara, a leader in high-performance, programmable neural processing units that enable energy-efficient, diverse edge AI applications. The $307 million takeover in H1 2025 will help NXP Semiconductors NV’s (NASDAQ:NXPI) ability to offer a complete and scalable AI platform by integrating discrete NPUs and AI software into its portfolio of processors, security, and advanced analog solutions.
1. Alibaba Group Holding Limited (NYSE:BABA)
Number of Hedge Fund Holders: 115
Alibaba Group Holding Limited (NYSE:BABA) is an e-commerce giant heavily leveraging AI, NLP, and ML to improve customer services, text analysis, and translation. Furthermore, Alibaba Cloud’s full-stack offerings enable developers to use AI-ready infrastructure to create and optimize foundation models and GenAI applications and deploy them cost-efficiently at scale. On the first day of the Lunar New Year, Alibaba Group Holding Limited (NYSE:BABA) launched its Qwen 2.5 AI model soon after the DeepSeek-V3 rollout. The Qwen 2.5 is pre-training on large-scale multilingual and multimodal data to facilitate natural language processing, text generation, AI tool use, and chatbot role-play.
On February 10th, JPMorgan analyst Alex Yao highlighted sensing a growing positive sentiment on Alibaba Group Holding Limited (NYSE:BABA) shares, given the 13% stock price rally in the past five trading days. The brokerage maintained an “Overweight” rating on the stock with a $125 target price. The analyst noted that there are still mixed views and positions on the stock, implying “room for share price movement on both sides.” The brokerage believes investors are divided on the potential upside of Alibaba’s AI initiatives and cloud business. JPMorgan thinks showcasing a concrete plan for monetizing AI capabilities “could alleviate investor concerns about the sustainability of the current rally.”
While we acknowledge the potential of Alibaba Group Holding Limited (NYSE:BABA) 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 BABA but that trades at less than 5 times its earnings, check out our report about the cheapest AI stock.
READ NEXT: 20 Best AI Stock To Buy Now and Complete List of All AI Companies Under $2 Billion Market Cap.
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