Reuters reported on Tuesday that OpenAI has been unsatisfied with some of Nvidia’s latest artificial intelligence chips, seeking alternatives since last year. Sources familiar with the matter note how this may complicate the relationship between two of the biggest players in the AI boom.
The ChatGPT maker is rethinking parts of its hardware strategy as it places an increasing emphasis on chips used to perform specific elements of AI inference. This is the stage at which an AI model is able to respond to customer queries and requests.
Even though Nvidia continues to dominate the AI chip market, inference is increasingly emerging as a new and increasingly important battleground. OpenAI’s decision represents a test of Nvidia’s dominance, particularly as the two companies are now in investment talks.
Back in September, Nvidia had announced its intent to pour as much as $100 billion into OpenAI as part of a deal that gave it a stake in the startup and also OpenAI the cash it needed to buy the advanced chips.
While the deal had been expected to close within weeks, negotiations have been dragging on for months. Nvidia CEO Jensen Huang brushed off these rumors, stating that the company has planned a huge investment in OpenAI.
“Customers continue to choose NVIDIA for inference because we deliver the best performance and total cost of ownership at scale,” Nvidia said in a statement.
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 Q3 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 427.7% since May 2014, beating its benchmark by 264 percentage points (see more details here).
10. Fortinet, Inc. (NASDAQ:FTNT)
Number of Hedge Fund Holders: 44
Fortinet, Inc. (NASDAQ:FTNT) is one of the 10 AI Stocks Analysts Are Watching. On January 30, Jefferies analyst Joseph Gallo reiterated a Hold rating on the stock with an $80.00 price target. The firm anticipates a modest Q4 beat but will wait for clearer visibility into 2H26 momentum.
The cybersecurity company is scheduled to report its fourth-quarter earnings on February 5. The research firm forecasts Fortinet to exceed consensus billings growth estimates of 12% year-over-year by an estimated 1-2%, driven by improved survey data.
However, Jefferies has flagged several 2026 metrics imply a high expectations, including consensus expectations for billings growth, services revenue growth, and operating margins.
Since the current sentiment toward software stocks is weak, the firm remains cautious heading into the print and waits to be constructive until there is visibility for a potential product refresh and services rebound in the second half of 2026.
“We expect FTNT to beat 4Q cons 12% YoY billings by 1–2%, supported by improved survey. Our convos indicate appetite to eventually own shares but several CY26 metrics imply high opening guide bars (11% YoY cons ’26 billings, 13% YoY services rev & 34% OPM). Given deteriorating software sentiment, we remain cautious into the print but expect set-up to improve in future Qs & wait to be constructive till there’s visibility for 2H26 prod refresh/services rebound.”
Fortinet, Inc. (NASDAQ:FTNT), a cybersecurity company, provides enterprise-level next-generation firewalls and network security solutions, leveraging artificial intelligence across its cybersecurity products.
9. QUALCOMM Incorporated (NASDAQ:QCOM)
Number of Hedge Fund Holders: 63
QUALCOMM Incorporated (NASDAQ:QCOM) is one of the 10 AI Stocks Analysts Are Watching. On February 2, Bernstein SocGen Group analyst Stacy Rasgon lowered the price target on the stock to $200.00 (from $215.00) while maintaining an “Outperform” rating. Despite certain risks, the firm is constructively positive on the stock driven by a developing undervalued growth narrative.
Bernstein noted how the QCOM shares have lagged in recent months due to factors such as a general distaste of smartphones, AAPL roll off, and recent dynamics in the memory market. While the demand for smartphones has been fine, investors remain cautious about the forward outlook.
Despite these concerns, the firm believes QCOM may be more insulated due to its over-indexing to the higher-end segment, even though it is not necessarily immune to broader industry headwinds.
The firm further added that as Apple-related revenues diminish over time, QCOM’s strong product portfolio, growing adjacencies, and an emerging AI story will allow the company’s underlying strength to become more visible.
QCOM’s current valuation is at less than 13x forward earnings, representing an estimated 44% discount to the S&P 500 and a 56% discount to the Philadelphia Semiconductor Index (SOX). This implies potential value despite concerns about the company operating in out-of-favor market segments.
“We get that the stock plays in out-of-favor areas, numbers might be too high, etc. But we still think the story is worth a look as the narrative grows cleaner through the year. We lower our PT to $200 to reflect lower estimates, but maintain our Outperform rating.”
QUALCOMM Incorporated (NASDAQ:QCOM) develops wireless technologies, supplies chips for mobile, automotive, and IoT, licenses patents, and invests in emerging tech.
8. Marvell Technology, Inc. (NASDAQ:MRVL)
Number of Hedge Fund Holders: 76
Marvell Technology, Inc. (NASDAQ:MRVL) is one of the 10 AI Stocks Analysts Are Watching. On February 2, RBC Capital analyst Srini Pajjuri reiterated an Outperform rating on the stock with a $105.00 price target. The firm remains confident in MRVL’s long-term AI infrastructure thesis despite near-term EPS dilution.
RBC Capital particularly updated MRVL’s estimates after the completion of the Celestial AI acquisition. The updated estimates align with management’s guidance, the firm noted, adding that it continues to view the acquisition favorably.
The firm further noted that AWS is interested in using Celestial’s optical chiplet solution for scale-up networking. This positions Marvell favorably for Amazon’s Trainium4.
“The acquisition along with AMZN warrant agreement should position MRVL particularly well for Trainium4, in our view.”
It added that its earnings per share estimates for Marvell have been slightly reduced due to stock issuance and higher operating expenses and interest expenses related to the acquisition.
“Our EPS estimates come down slightly on stock issuance and higher opex/interest expenses (Celestial revenue not expected to contribute until Q3FY28). We maintain our $105 PT and reiterate Outperform.”
As per the analyst report, revenue contribution from the Celestial AI acquisition is not anticipated until third quarter of fiscal year 2028.
Marvell Technology, Inc. (NASDAQ:MRVL) develops and manufactures semiconductors, with a heavy focus on data centers.
7. Palantir Technologies Inc. (NASDAQ:PLTR)
Number of Hedge Fund Holders: 81
Palantir Technologies Inc. (NASDAQ:PLTR) is one of the 10 AI Stocks Analysts Are Watching. On February 3, Wedbush analyst Dan Ives reiterated an Outperform rating on the stock with a $230.00 price target. The firm applauded PLTR for a “drop the mic” quarter, seeing it lead the AI revolution with unmatched AIP moat.
Palantir reported its FY4Q25 earnings yesterday, beating Wall Street’s estimates amid rising spending on AI tools from governments and businesses. The company reported $1.41 billion in revenue, ahead of LSEG estimates of $1.33 billion.
According to CEO Alex Karp, Palantir’s earnings were the best results that he is aware of in tech in the last decade. Webush noted how PLTR delivered another robust drop the mic quarter of beats across the board. Looking ahead, it provided FY26 guidance that exceeded Street estimates.
“Palantir reported its FY4Q25 results featuring yet another strong drop the mic quarter of beats across the board while providing FY26 guidance that exceeded Street estimates as the company’s AIP continues to accelerate with US Commercial remaining a core driver of growth. We maintain our OUTPERFORM rating and $230 price target as Palantir is helping lead the AI Revolution into the use case phase as its AIP product moat is unmatched in our view.”
Palantir Technologies Inc. (NASDAQ:PLTR) is a leading provider of artificial intelligence systems.
6. Autodesk, Inc. (NASDAQ:ADSK)
Number of Hedge Fund Holders: 83
Autodesk, Inc. (NASDAQ:ADSK) is one of the 10 AI Stocks Analysts Are Watching. On February 2, JPMorgan analyst Alexei Gogolev upgraded the stock from Neutral to Overweight with a price target of $319.00.
The firm believes that the software stock is a standout, adjusting its ratings in the industrial software space due to a shift in a conviction driven by diverging fundamentals within the vertical software-as-service landscape.
ADSK is seen as a clear industry standard among architects, engineers, and contractors globally, with its cloud-native platform and rapid AI integration leading to operational efficiency and streamlining project workflows.
“Autodesk stands out for its leadership in design and BIM [building information modeling] software, rapid adoption of cloud and AI technologies, and expanding platform breadth, which position it to capture outsized share in high-growth verticals such as data centers and infrastructure.”
Customer feedback has revealed that there is a trend among large firms toward software consolidation. These firms are increasingly standardizing on Autodesk for their design and compliance needs.
Overall, the firm believes that ADSK’s innovation, platform breadth, and exposure to secular growth drivers justify its rating.
Autodesk, Inc. (NASDAQ:ADSK), a multinational software corporation, leverages generative AI technology to drive innovation across the design, construction, manufacturing, and entertainment industries.
5. MongoDB, Inc. (NASDAQ:MDB)
Number of Hedge Fund Holders: 89
MongoDB, Inc. (NASDAQ:MDB) is one of the 10 AI Stocks Analysts Are Watching. On January 30, BofA Securities analyst Brad Sills raised the price target on the stock to $500.00 (from $480.00) while maintaining a “Buy” rating. The firm sees MDB as a leader in database growth, with room for multiple expansion.
BofA’s buy rating on the database vendor is driven by its accelerating Atlas revenue growth, which reached 30% year-over-year in the third fiscal quarter from 29% in the second quarter.
The firm pointed to broader deployments across large corporate customers, continued expansion from existing users, alongside an expanding product portfolio focused on artificial-intelligence use cases and legacy app modernization.
Growing enterprise workloads, the firm noted, also support higher consumption on the platform.
“We raise our PO to $500 from $480 based on 14.2x EV/CY26E revenue multiple (12x EV/CY27E (FY28E) previously) or 0.7x growth adjusted (0.8x previously), a premium to infrastructure software peers at 5.6x/0.5x.”
Analysts believe a premium is warranted given MDB’s faster growth profile and leadership position.
“We revise estimates to reflect our updated view of growth potential.”
MongoDB, Inc. (NASDAQ:MDB) provides a general-purpose database platform worldwide that integrates operational, unstructured, and AI-related data to streamline building applications.
4. AppLovin Corporation (NASDAQ:APP)
Number of Hedge Fund Holders: 110
AppLovin Corporation (NASDAQ:APP) is one of the 10 AI Stocks Analysts Are Watching. On February 2, Benchmark analyst Mike Hickey reiterated a Buy rating on the stock with a $775.00 price target. The firm sees AI-native game creation risks as overstated, seeing no direct impairment to the company’s long-term positioning.
Benchmark noted how a new artificial-intelligence project at Google could disrupt how videogames are made, but that AppLovin’s role in the mobile ecosystem remains intact.
“While AI-native world models represent a credible long-term challenge to incumbent game engines and traditional development workflows, we believe the implications for AppLovin are materially different and often overstated.”
Dismissing concerns that Google DeepMind’s Project Genie could threaten AppLovin, the firm noted that developers will eventually package Genie-created experiences as standalone games and distribute them through Android and iOS instead of remaining confined within Alphabet’s ecosystem.
“Under this assumption, AI-native creation changes how games are built, but not how they are discovered, acquired, or monetized.”
Advertisers wouldn’t be entirely safe from advancements in AI-driven game development. Lower development costs could mean shorter game lifecycles and faster player churn, which may reduce user-acquisition spending for individual games.
“While AI-driven creation could pressure per-title LTV in gaming over time, we believe this risk is likely offset by higher content volume, faster iteration cycles, and sustained advertiser demand across a unified auction. As a result, we see no clear mechanism by which Project Genie or similar AI-native creation tools would directly impair AppLovin’s long-term competitive position.”
AppLovin Corporation (NASDAQ:APP) provides a leading marketing platform powered by AI technology.
3. Tesla, Inc. (NASDAQ:TSLA)
Number of Hedge Fund Holders: 115
Tesla, Inc. (NASDAQ:TSLA) is one of the 10 AI Stocks Analysts Are Watching. On February 2, Cantor Fitzgerald reiterated the stock as “Overweight,” stating that it’s sticking with Tesla. The firm believes that this year is transformational for Tesla as it transitions into autonomy, AI, and robotics.
“We are also bullish on Optimus and the opportunities in humanoid, though we remain conversative in our initial modeling assumptions. Overall, we remain bullish on TSLA over the medium to long term, and we view FY26 as a transformational year for the company as it transitions into autonomy, AI and robotics.”
Analysts on Wall Street have a consensus “Buy” rating on the stock. The average price target of $480 implies a 13.8% upside; however, the Street-high target of $600 implies an upside of 42.24%.
Tesla, Inc. (NASDAQ:TSLA) is an automotive and clean energy company that leverages advanced artificial intelligence in its autonomous driving technology and robotics initiatives.
2. Oracle Corporation (NYSE:ORCL)
Number of Hedge Fund Holders: 122
Oracle Corporation (NYSE:ORCL) is one of the 10 AI Stocks Analysts Are Watching. On February 2, UBS analyst Karl Keirstead lowered the price target on the stock to $250.00 (from $280.00) while maintaining a Buy rating. The firm sees ORCL’s recent funding clarity as a potential catalyst despite equity dilution concerns.
“Right ahead of a planned debt issuance, Oracle press-released some incremental disclosures about its funding needs in 2026, required to finance the build-out of AI infrastructure.”
Oracle recently announced that it will raise an estimated $45 billion to $50 billion in calendar 2026 through a combination of stock sales and debt. This move, the company said, reflects on its commitment to maintain an investment-grade rating amid the AI spending.
In particular, the company has outlined plans for a debt raise of only $20-25 billion coupled with an equity raise of up to $20 billion. The firm noted how the planned debt component may be viewed positively by credit investors.
However, the equity raise portion, previously described as a last resort by the company, may not receive the same warm reception from all equity holders.
“We are Buy-rated and wonder if this long-awaited clarity may serve as a clearing event for the stock.”
Oracle Corporation (NYSE: ORCL) is a database management and cloud services provider.
1. Amazon.com, Inc. (NASDAQ:AMZN)
Number of Hedge Fund Holders: 332
Amazon.com, Inc. (NASDAQ:AMZN) is one of the 10 AI Stocks Analysts Are Watching. On February 2, Evercore ISI analyst Mark Mahaney reiterated an Outperform rating on the stock with a $335.00 price target. The firm sees a potential script flip for AMZN from AI laggard to AI winner by 2026.
Evercore ISI expects Amazon to deliver results in line with market expectations when it reports on February 5, with Q4 revenue estimates of $211 billion (up 12% year-over-year) and operating income of $24.6 billion (11.7% margin), both of whom appear reasonable based on intra-quarter data points.
Retail spending trends appear supportive, while Amazon-specific sales indicators appear softer. The stock is still seen as attractive heading into the print, with recent read-throughs from Azure results and third party retail data dampening sentiment.
“Fundamentally, we see in AMZN ’26 a potential acceleration/expansion story (revenue growth acceleration & operating margin expansion). And narratively, we see in AMZN ’26 the potential for the script to flip from AI Laggard to AI Winner – in a manner not too dissimilar to GOOGL ’25 (tho not as dramatic.)”
The firm said that AMZN is its number one Large Cap Net Long. For the first quarter of 2026, consensus estimates are seen as achievable, with greater upside potential on operating income as revenue.
Investors will be particularly looking out for evidence that AWS growth can continue to accelerate with clear backlog, the sustainability of retail unit-economics improvements, durability of advertising growth, and updated guidance on capital spending and capacity expansion.
The firm models North America Retail Revenue of $127.7 billion (up 10.5% year-over-year), AWS Revenue of $34.6 billion (up 20% year-over-year), and total operating margin of 11.9% for Q4, which is slightly higher than the Street’s expectation of 11.7%.
“FCF & CapEx Trends: We are modelling $31.6B in FCF for FY25, implying a 4.4% FCF Margin. In terms of CapEx, we are modelling $125.17B for FY25 (+61% Y/Y), slightly higher than the Street.”
Amazon.com Inc. (AMZN) is an American technology company offering e-commerce, cloud computing, and other services, including digital streaming and artificial intelligence solutions.
While we acknowledge the potential of AMZN 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 AMZN and that has 100x upside potential, check out our report about this cheapest AI stock.
READ NEXT: 10 AI Stocks in Focus on Wall Street and 10 AI Stocks Gaining Attention on Wall Street
Disclosure: None. Insider Monkey focuses on uncovering the best investment ideas of hedge funds and insiders. Please subscribe to our free daily e-newsletter to get the latest investment ideas from hedge funds’ investor letters by entering your email address below.
