Robust second-quarter earnings have eased investor concerns about the health of the US economy. Based on these positive events, Jefferies have raised its year-end target for the S&P 500 index to 6,600, stating that corporate America is holding up much better than anticipated.
This means good news for investors, reflecting how the rally still has a lot of room to run. Previously, Jefferies was the only firm projecting the benchmark index below the 6,000 mark at 5,600. Some of the leading brokerages who boosted their index target earlier were UBS, Citigroup, and HSBC.
According to Jefferies analyst Desh Peramunetilleke, AI-related companies and the “Magnificent Seven” have led these market gains. Meanwhile, robust financials demonstrate a resilient macroeconomic backdrop.
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. The hedge fund data is as of Q2 2025.
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 373.4% since May 2014, beating its benchmark by 218 percentage points (see more details here).
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10. Baidu, Inc. (NASDAQ:BIDU)
Number of Hedge Fund Holders: 33
Baidu, Inc. (NASDAQ:BIDU) is one of the 10 AI Stocks Analysts Are Tracking Closely. On August 21, Benchmark analyst Fawne Jiang lowered the price target on Baidu (NASDAQ: BIDU) to $115.00 (from $120.00) while maintaining a Buy rating.
The price target cut reflects the challenges Baidu is facing in its core advertising business, witnessing a 15% year-over-year revenue decline in the second quarter of 2025. With GenAI search monetization still in early stages, the second-quarter ad outlook was “muted”.
On the other hand, the company’s non-advertising revenue continues to gain traction, accounting for an estimated 40% Baidu Core. This is driven by strong AI Cloud growth, which expanded 34% year-over-year in the first half of 2025, as well as subscription-based revenue for improved stability.
The firm also talked about the company’s autonomous driving service, Apollo Go, which is demonstrating strong performance.
“Apollo Go adds further depth, with fully driverless rides up 148% y/y and global expansion gaining pace through partnerships with Uber and Lyft. While the combination of soft ad trends and continued AI investment may weigh on margins near term, management’s focus on cost efficiency and disciplined execution should help to mitigate the impacts. We believe that the upcoming launch of ERNIE 5.0 and rising engagement with AI-powered search reinforce Baidu’s pivot toward a more diversified, innovation-led model, though execution remains key in this evolving landscape.”
Baidu, Inc. (NASDAQ:BIDU) is a Chinese internet giant and AI pioneer, known for its noteworthy investments in artificial intelligence technology and its position as the dominant search engine within the country.
9. CoreWeave, Inc. (NASDAQ:CRWV)
Number of Hedge Fund Holders: 36
CoreWeave, Inc. (NASDAQ:CRWV) is one of the 10 AI Stocks Analysts Are Tracking Closely. On August 21, H.C. Wainwright analyst Kevin Dede upgraded the stock from Neutral to Buy with a price target of $180.00.
The stock has been facing selling pressure due to likely early investor liquidation following lockup expiration, instead of worries regarding the company’s fundamentals.
“Stock pressure flouting the long game. We saw the uptick in guidance offered on CoreWeave’s earnings call as a positive, some of which was discussed August 13 here, but it appears to have been ignored within the context of investor thinking. Or, perhaps, it is that early investors, having stayed long enough, seek liquidity on the lockup expiration? Specifically, looking at the company’s public issuance of revenue expectations, at the time of the March quarter call, May 14, FY25 labeled the range of $4.9–5.1B, but by Aug. 12 on the 2Q25 call, the range was raised to $5.15–5.35B, up 5% at the midpoint.”
Referring to CoreWeave’s position in the neocloud space, the firm believes the company is “a leader in perhaps one of the most influential technology adoption cycles of our time.”
“On that basis, we are raising our investment rating on CoreWeave to Buy from Neutral, noting that when we interrogated the Magic 8-Ball last night, it couldn’t commit to a rising CRWV share price in the near-term. We volunteer this point jokingly in emphasizing the longer-term perspective where the inherent value CoreWeave brings its customers becomes luminous, though it should be now. We are not adjusting estimates here, just recognizing the stock’s valuation has sunk deep enough, we believe, to suggest investors could enjoy healthy returns to previous stock levels on the back of a leader in the neocloud space. With our new Buy rating, we are offering a $180 price target, the recent June-end high where the stock enjoyed a cup of coffee and immediately retreated.”
8. Dell Technologies Inc. (NYSE:DELL)
Number of Hedge Fund Holders: 54
Dell Technologies Inc. (NYSE:DELL) is one of the 10 AI Stocks Analysts Are Tracking Closely. On August 21, Morgan Stanley analyst Erik Woodring raised the price target on the stock to $144.00 (from $135.00) while maintaining an Overweight rating.
Analysts believe that the recent pullback in the shares offer a more compelling setup into earnings. July quarter results for enterprise hardware are expected to modestly outperform expectations driven by robust artificial intelligence spend and solid PCs in Q2. The firm also views upside to Dell’s Q2 estimates and full-year outlook.
According to Morgan Stanley, Dell is the leading OEM for AI compute, gaining share with key customers xAI and CRVV. Several other catalysts are working in favor of the stock, which is why the firm likes its long-term story.
“We continue to like DELL’s long-term story — the company is the clear leading OEM for AI compute and is gaining share with key customers xAI and CRVV, is back to gaining share in enterprise storage markets, is performing decently in traditional servers, and is in the middle innings of a company-wide cost efficiency program that we see driving 10%+ EPS growth over the next 3 years (vs. mgmt’s stated goal of 8%+). At $128, or ~10% lower than a week ago, DELL is trading at 11.3x our FY27/CY26 EPS, which is 5% above Consensus, and thus we see an opportunity for both multiple expansion and positive EPS revisions from here. That said, we see less upside to DELL vs. HPE over the next 12 months given DELL’s current valuation premium, unless we gain confidence that DELL Storage can be a secular grower (aided by AI attach), which is incorporated into our $196 bull case valuation. DELL’s October 7 Analyst Day will be the next major catalyst after F2Q earnings.”
7. Hewlett Packard Enterprise Company (NYSE:HPE)
Number of Hedge Fund Holders: 60
Hewlett-Packard Enterprise Company (NYSE:HPE) is one of the 10 AI Stocks Analysts Are Tracking Closely. On August 21, Morgan Stanley analyst Erik Woodring upgraded the stock from Equalweight to Overweight with a price target of $28.00 (from $22.00). The firm’s rating affirmation reflects increased corporate spending on HPE’s artificial intelligence (AI) and other products.
The analysts noted that their “checks signaled healthy enterprise spending across the board in the quarter, led by anything AI compute or networking related, followed by client devices (strong PC refresh), and then servers/storage, with networking growth inflecting positively for the first time in several quarters.”
The firm looks forward to HPE’s Analyst Day on October 15, as the most important upcoming catalyst for the company.
“We are upgrading HPE to Overweight (from Equal-Weight) with a new $28 price target, or 11x our new FY26 EPS of $2.51. Our thesis is straight-forward – with the closure of JNPR, we see 18% upside to FY26 Consensus EPS, with EPS growing to $2.70-3.00 in FY27, and believe that as the market comes to better understand nearly half of HPE’s business is networking, inclusive of more AI exposure (JNPR in xAI cluster), HPE’s multiple will re-rate above the current 8x multiple. Our 11x target P/E multiple doesn’t even assume HPE garners a peer average multiple, and yet we still see 33% upside to shares from here. The biggest risks to our call are (1) execution — deals always look better on paper than in real-life and the risk here is that this deal is no different / the synergies mgmt outlined don’t materialize as expected, (2) JNPR/Aruba underperforms outside of the xAI exposure as competition is intense in networking and campus upgrade exposure is relatively limited (with risk of JNPR CEO leaving eventually), and (3) FCF and/or capital returns continue to disappoint vs. expectations.”
Hewlett Packard Enterprise Company (NYSE:HPE), an American multinational technology company, provides high-performance computing systems, AI software, and data storage solutions for running complex AI workloads.
6. Intel Corporation (NASDAQ:INTC)
Number of Hedge Fund Holders: 82
Intel Corporation (NASDAQ:INTC) is one of the 10 AI Stocks Analysts Are Tracking Closely. On August 25, Bernstein SocGen Group analyst Stacy Rasgon reiterated a Market Perform rating on the stock with a $21.00 price target. The rating follows the US government and Intel’s joint announcement that U.S. government will purchase $8.9 billion in Intel’s common stock under an agreement with the Trump Administration.
Stacy Rasgon recommends an “avoidance of Intel’s shares.”
The company is issuing ~520M new shares—including 433M to the U.S. government at $20.47 each and 87M to SoftBank at $23. This will dilute existing shareholders by ~11%, with the U.S. becoming Intel’s largest shareholder.
Rasgon believed that the news may limit short-term downside. However, structural issues remain that will keep Intel unattractive over the long-term.
“At this point we continue to recommend avoidance of Intel’s shares. They feel like a tough short given this kind of newsflow in the short term, but the structural issues still feel massive keeping us away from the long side. We make no changes to our model at this time. We rate Intel’s stock Market-Perform, $21 PT.”
5. Workday, Inc. (NASDAQ:WDAY)
Number of Hedge Fund Holders: 85
Workday, Inc. (NASDAQ:WDAY) is one of the 10 AI Stocks Analysts Are Tracking Closely.
On August 22, Cantor Fitzgerald reiterated an Overweight rating on the stock with a $265.00 price target following the company’s “slightly better-than-expected” quarterly results.
The firm highlighted several positive indictors from the earnings print. However, the company has only raised its full-year revenue guidance to account for its Paradox acquisition instead of accounting for the second-quarter performance beat. This implies that management is conservative about its second-half performance.
“WDAY reported slightly better-than-expected results with revenue, op margin and EPS all slightly above VA consensus, but calc. billings coming in slightly below. Importantly, cRPO growth was 16.4% vs. 15–16% guide, with early renewals from customers adding AI and other next-gen features cited as the key driver. Looking ahead, F2Q results give us optimism for sustained momentum into F2H, though investor concerns regarding the macro/AI headwinds to broader SaaS growth now essentially hinge on 2H acceleration and improved execution. While worst case scenarios are likely taken off the table, mgmt. only raised FY topline guide to account for its Paradox acquisition (and not 2Q beat), implying mix of 2H conservatism and uncertainty, which will likely continue to pressure the narrative in the short term. We remain Overweight rated as we believe the long-term concerns are overblown, leaving an attractive risk-reward scenario that skews to the upside.”
Workday, Inc. (NASDAQ:WDAY) provides enterprise cloud applications.
4. Snowflake Inc. (NYSE:SNOW)
Number of Hedge Fund Holders: 100
Snowflake Inc. (NYSE:SNOW) is one of the 10 AI Stocks Analysts Are Tracking Closely. On August 21, TD Cowen analyst J. Derrick Wood reiterated a Buy rating on the stock with a $240.00 price target. The rating affirmation comes ahead of the company’s second-quarter earnings report due on August 27.
The firm has highlighted “positive checks” in its analysis, with core consumption stability and sustained traction with Data Engineering workloads for Snowflake. Moreover, the firm noted that Snowflake’s unified data platform positioning is helping capture more AI-related market share.
“Positive Checks; Unified Data Platform & GTM Shifts Resonating; SNOW reports 2Q on 8/27. Partner checks were bullish, incl. core consumption stability, continued traction w/ Data Eng workloads, emerging momentum w/ Cortex AI, & positive changes from new enterprise sales motions. We think its unified data platform positioning is helping garner more AI-related wallet share. Expect another solid beat & raise alongside growth re-acceleration vs. 1Q.”
Overall, TD Cowen expects a solid upside quarter for the company, with continued execution anticipated to help drive premium valuations.
“Overall, checks point to strong spending conditions for SNOW, w/ strength in core SQL workloads, emerging tailwinds from AI workloads & positive changes in GTM motions. We expect another solid upside qtr (vs. ~4% TTM avg on a $ basis) relative to its 2Q guide of 25% growth, which would represent notable growth acceleration vs. 26% in 1Q. Continued execution should help drive premium valuations (currently at ~46x EV/CY26E FCF) against a Rule of 50+ framework. Reiterate Buy.”
Snowflake Inc. (NYSE:SNOW) is a cloud-based data storage company providing a data analysis, storage, and sharing platform.
3. Broadcom Inc. (NASDAQ:AVGO)
Number of Hedge Fund Holders: 156
Broadcom Inc. (NASDAQ:AVGO) is one of the 10 AI Stocks Analysts Are Tracking Closely. One of the biggest analyst calls on Monday, August 25, was for Broadcom. Deutsche Bank reiterated the stock as “Buy” stating that the stock is well positioned ahead of earnings in early September.
“Further, the company continues to expect an eventual cyclical turnaround in its core communications and networking businesses, albeit with that event likely in 2026. As such, we remain optimistic on the fundamental growth prospects for AVGO and maintain our Buy rating.”
Broadcom is a technology company uniquely positioned in the AI revolution owing to its custom chip offerings and networking assets.
2. Apple Inc. (NASDAQ:AAPL)
Number of Hedge Fund Holders: 156
Apple Inc. (NASDAQ:AAPL) is one of the 10 AI Stocks Analysts Are Tracking Closely. On August 25, Bank of America reiterated the stock as “Buy” and acknowledged that even though there are reports that there is no official iPhone event yet scheduled on September 9 for Apple, investors should tone down their expectations for the next cycle anyway.
“Some media reports and tech websites are highlighting Tues Sep 9th as a potential launch date for iPhone 17 (not official yet), with pre-orders starting Friday Sep 12th, and new iPhones reaching stores on Fri Sep 19th. We expect the main feature to be the launch of a slim iPhone (iPhone 17 Air) to replace the current Plus model. While prior form factor changes have driven a meaningfully higher next iPhone cycle, in our opinion, investor expectations for the benefit from a thin phone are more tempered.”
1. NVIDIA Corporation (NASDAQ:NVDA)
Number of Hedge Fund Holders: 235
NVIDIA Corporation (NASDAQ:NVDA) is one of the 10 AI Stocks Analysts Are Tracking Closely. On August 22, the company announced the launch of NVIDIA Spectrum-XGS Ethernet, a networking technology designed for combining distributed data centers into unified, giga-scale AI super-factories.
With the surging demand for artificial intelligence, individual data centers can no longer handle the required capacity and power alone. This is why scaling data centers has become the need of the hour, an expansion hindered by standard Ethernet networking.
Spectrum-XGS Ethernet breaks through boundaries through its scale-across infrastructure, leveraging algorithms that adapt network performance based on the distance between data center facilities.
Featuring auto-adjusted distance congestion control, precision latency management and end-to-end telemetry, Spectrum-XGS Ethernet helps augment performance across geographically separated locations.
Nvidia has announced that CoreWeave will be among the first to connect its data centers with Spectrum-XGS Ethernet.
“CoreWeave’s mission is to deliver the most powerful AI infrastructure to innovators everywhere. With NVIDIA Spectrum-XGS, we can connect our data centers into a single, unified supercomputer, giving our customers access to giga-scale AI that will accelerate breakthroughs across every industry.”
-Peter Salanki, cofounder and chief technology officer of CoreWeave.
NVIDIA Corporation (NASDAQ:NVDA) specializes in AI-driven solutions, offering platforms for data centers, self-driving cars, robotics, and cloud services.
While we acknowledge the potential of NVDA as an investment, our conviction lies in the belief that some AI stocks hold greater promise for delivering higher returns and have limited downside risk. If you are looking for an AI stock that is more promising than NVDA and that has 100x upside potential, check out our report about this cheapest AI stock.
READ NEXT: 10 AI Stocks in the Spotlight Today and 10 Must-Watch AI Stocks for Investors.
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