China hosted its largest AI event of the year in Shanghai this Saturday, drawing in thousands of attendees. The 2025 World Artificial Intelligence Conference (WAIC) garnered more than 800 companies and unveiled over 3,000 AI-related exhibits from more than 30 countries and regions.
Unfortunately, one big name missing at the biggest AI event of the year was Nvidia. Following news of the H20 chip-ban reversal only a while back, the chip-maker’s absence was clearly visible at the AI event.
In contrast, rival Huawei boasted a large display, particularly focused on its Ascend AI chips. Nvidia CEO Jensen Huang has called Huawei “one of the most formidable technology companies in the world,” previously warning that it could replace his company in China if the U.S. continues with its export curbs on Beijing.
Huawei introduced its Ascend 384 AI compute node system at the said AI event. The company is marketing the product as “Atlas 900 A3 SuperPoD.” Besides Huawei, other noteworthy players in the supply chain for advanced chips are semiconductor designer Moore Threads and startup Yunsilicon, both of which had booths at WAIC.
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 Q1 2025.
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A group of analysts studying data on a large monitor.
10. Walmart Inc. (NYSE:WMT)
Number of Hedge Fund Holders: 100
Walmart Inc. (NYSE:WMT) is one of the 10 AI Stocks Everyone Is Watching Closely. On July 28, Morgan Stanley reiterated the stock as “Overweight,” stating that Walmart is a “clear leader” in retail artificial intelligence.
“AI use cases in Food Retail are accelerating, driving stronger sales growth and greater efficiencies. WMT a clear leader.”
In other news, Walmart has recently unveiled plans to roll out a suite of AI-powered “super agents” for enhancing the shopping experience for customers and streamlining operations.
According to the retailer, the four agents powered by agentic AI are designed for Walmart shoppers, store employees, suppliers and sellers, and software developers. These agents will be the primary way of contact for the said groups very soon.
These super agents will replace existing agents and AI tools and will be the first point of contact for every AI interaction that the groups will have with Walmart. The company is planning to leverage artificial intelligence to boost its e-commerce growth, with a goal set for online sales to account for 50% of its total sales within five years.
One of the agents from Walmart, Sparky, has already been made available for shoppers on Walmart’s app as a Gen-AI-powered tool, albeit not in its super-agent form yet.
Walmart Inc. (NYSE:WMT) operates retail and wholesale stores and clubs, eCommerce websites, and mobile applications worldwide.
9. Tesla, Inc. (NASDAQ:TSLA)
Number of Hedge Fund Holders: 104
Tesla, Inc. (NASDAQ:TSLA) is one of the 10 AI Stocks Everyone Is Watching Closely. On July 28, Deutsche Bank reiterated the stock as “Buy” with a $345 price target. The firm said that more “patience” is needed for Tesla’s robotaxi service, but that it is sticking with the stock.
“Tesla’s robotaxi service is currently still very small scale, having accumulated only +7k miles since the launch on June 22nd with 10-20 vehicles in the fleet. Management did not provide a lot of clarity regarding the pace of expansion although Elon Musk indicated the goal of technically being able to cover half the US population by year-end.”
In other news, Cantor Fitzgerald analyst Andres Sheppard reiterated an “Overweight” rating on the same day with a $355.00 price target. The firm anticipates robotaxi expansion into the Bay Area in the third quarter. It believes this will be followed by Arizona, Nevada, and possibly Florida in the fourth quarter of 2025 or 2026.
Tesla, Inc. (NASDAQ:TSLA) is an automotive and clean energy company that leverages advanced artificial intelligence in its autonomous driving technology and robotics initiatives.
8. ServiceNow, Inc. (NYSE:NOW)
Number of Hedge Fund Holders: 106
ServiceNow, Inc. (NYSE:NOW) is one of the 10 AI Stocks Everyone Is Watching Closely. On July 23, Erste Group analyst Stephan Lingnau downgraded the stock to “Hold” from Buy due to limited upside potential for the stock.
The analyst told investors in a research note that ServiceNow’s growth momentum is slightly lower in 2025 as compared to 2024, despite the company offering customers innovative products to enhance productivity levels. Moreover, its shares trade at a significantly higher multiple to peers, even though there is a similar operating margin and return on equity.
Erste Group’s analysis reveals that it anticipates software revenue from subscriptions to increase by 19% to 19.5% in the second quarter. The company’s operating margin and return on equity are roughly in line with the sector average. However, its expected P/E ratio for 2025 is significantly higher.
The valuation assessment led the firm’s analyst, Hans Engel, to assess that “the stock’s upside potential is therefore limited for the time being.” In turn, this led to the downgrade.
ServiceNow, Inc. (NYSE:NOW) is a technology company that offers a cloud-based software platform for automating business workflows within an enterprise.
7. GE Vernova Inc. (NYSE:GEV)
Number of Hedge Fund Holders: 111
GE Vernova Inc. (NYSE:GEV) is one of the 10 AI Stocks Everyone Is Watching Closely. On July 28, Mizuho downgraded the stock to “Neutral” from Outperform but raised the price target to $670 from $410. The updated rating reflects valuation concerns despite strong bookings in gas turbines and grid upgrades, which continue to drive earnings.
The firm highlighted how the company has accelerated EBITDA margins in the power and electrification business and higher gas power manufacturing capacity beyond 2028 due to strong bookings and reservations.
They also highlighted continued load growth market as evident from the recent PJM auction and increased spending by hyperscalers. However, it believes much of the improvement is already highlighted in the stock.
“We increase our PT to $670, up 63%, due to accelerating EBITDA margins in power and electrification business and higher gas power manufacturing capacity beyond 2028.”
GE Vernova Inc. (NYSE:GEV) is a global energy company and a soaring AI stock driven by the demand for energy to power artificial intelligence technology.
6. Alibaba Group Holding Limited (NYSE:BABA)
Number of Hedge Fund Holders: 125
Alibaba Group Holding Limited (NYSE:BABA) is one of the 10 AI Stocks Everyone Is Watching Closely. On July 28, Alibaba launched a pair of smart glasses powered by its artificial intelligence models, marking the firm’s entry into the product category. According to the company, Quark AI Glasses will be launched in China by the end of 2025.
These glasses will flaunt features rivaling those of Meta’s offering with Ray-Ban. Its hardware will be powered by the firm’s Qwen large language model and its advanced AI assistant Quark.
“Lightweight and ergonomically designed, Quark AI Glasses support hands-free calling, music streaming, real-time language translation, and meeting transcription—making them ideal for professionals, travelers, and tech-savvy users.”
-Alibaba.
Other details about the wearable technology are yet to be released.
Alibaba Group Holding Limited (NYSE:BABA) is an internet giant that offers e-commerce services in China and internationally.
5. Apple Inc. (NASDAQ:AAPL)
Number of Hedge Fund Holders: 159
Apple Inc. (NASDAQ:AAPL) is one of the 10 AI Stocks Everyone Is Watching Closely. On July 28, Analyst Krish Sankar from TD Cowen maintained a “Buy” rating on the stock with a price target of $275.00. The rating affirmation comes ahead of Apple’s earnings later this week.
The firm particularly talked about Apple’s expected revenue performance and strategic positioning. Even though the tech giant is subject to numerous challenges, such as an incomplete AI strategy and tariff sensitivity, it is projected to report June quarter revenues in line with expectations.
The firm also expects it to guide the September quarter upwards. This anticipated position by the firm is backed by the expected demand pull-ins ahead of tariff implementations, and also its stable performance in iPhone sales.
In other news, Bank of America reiterated Apple as “Buy” with a $235 price target. The firm said that all “eyes [are] on margins” ahead of Apple earnings later this week.
“As we head into F3Q25 (June qtr) earnings aftermarket on Thur July 31, we see client sentiment as fairly negative given uncertain impact from tariffs, U.S. DOJ investigation (Google TAC payments), App Store headwinds, and slow progress in AI.”
Apple is a technology company known for its consumer electronics, software, and services.
4. NVIDIA Corporation (NASDAQ:NVDA)
Number of Hedge Fund Holders: 223
NVIDIA Corporation (NASDAQ:NVDA) is one of the 10 AI Stocks Everyone Is Watching Closely. On July 28, Jefferies noted that Nvidia’s H20 AI chip stockpile (600K–900K units) falls short of China’s demand. This demand, it noted, could reach 1.8M units now that there has been a temporary relief in U.S. export restrictions.
“We believe as long as the U.S. and China are in a ‘truce’ state for trade negotiation, NVDA will be allowed to meet reasonable China demand.”
It further said that “NVDA likely has delivered ~300K in 1Q25,” roughly in line with pre-ban levels.
Regardless of these supply limits, the firm noted that Chinese firms are still after these Nvidia chips owing to their CUDA ecosystem, superior performance, and limited local alternatives.
This strong demand is anticipated to continue even for downgraded future chips like the upcoming B30 (Q4 2025).
The firm further anticipated that there is going to be a next-generation chip, the B30, which will likely be revealed in the fourth quarter of 2025. The B30 will have “reduced memory specs to comply with a likely new criterion for AI chip export control.”
The firm has raised China’s 2025 AI capex forecast by 40% to $108B. It did note that capital spending by China’s internet firms exhibits temporary weakness in the second quarter due to GPU rental supply, but believes that this “does not represent a slowdown in Internet players’ AI efforts.”
NVIDIA Corporation (NASDAQ:NVDA) specializes in AI-driven solutions, providing high-performance GPUs and platforms that power data centers, autonomous vehicles, robotics, and cloud services.
3. Meta Platforms, Inc. (NASDAQ:META)
Number of Hedge Fund Investors: 273
Meta Platforms, Inc. (NASDAQ:META) is one of the 10 AI Stocks Everyone Is Watching Closely. On July 28, Guggenheim analyst Michael Morris raised the price target on the stock to $800 from $725.00, while maintaining a “Buy” rating. The increased price target comes ahead of its July 30 Q2 earnings report.
Based on the firm’s pre-earnings buyside survey, Meta is the second-ranked long idea into earnings, with 27% of 105 respondents selecting it. Meanwhile, only 10% ranked the stock as a short idea, which positioned it ninth in the said category.
Intra-quarter ad checks from the firm reveal how it is evident that demand for Direct Response ads is robust, fueled by progress on Advantage+.
Moreover, the firm is also confident that the overall magnitude of opportunity and competitive intensity is such for Meta that it will continue to pursue AI growth and the “aggressiveness in investment” that comes with it.
Guggenheim further noted how it is probable that Meta’s commitment to AI investments will push “further aggressiveness in investment.” Its buy-side survey showed that 95% of respondents forecast 2026 capital expenditures of $76 billion or higher, while the firm has a figure of $82 billion now.
2. Microsoft Corporation (NASDAQ:MSFT)
Number of Hedge Fund Holders: 284
Microsoft Corporation (NASDAQ:MSFT) is one of the 10 AI Stocks Everyone Is Watching Closely. On July 28, Stifel reiterated the stock as “Buy” and raised its price target to $550 per share from $500 ahead of earnings later this week. The firm mentioned improving enterprise IT spending, booming Azure growth, and robust generative AI demand ahead of the company’s upcoming results.
“We believe healthy results from GCP and NOW last week and our strong checks point to a Q/Q acceleration in the enterprise spending environment.” They added that this, combined with “non-AI GTM execution improvements and robust genAI demand, should enable Azure to post ~100-200bps of upside vs. 34-35% Y/Y-CC guidance.”
It believes fiscal 2026 capital expenditures may surprise to the upside, and that even though there may be a potential squeeze on gross margins, the outlook on profitability remains positive.
“Looking forward, we believe management’s prior expectation that supply/demand imbalances would linger beyond June will be further pushed out to F2H26, and we also expect FY26 capex commentary could likely exceed our./street estimates of ~$110B/$100B, respectively, echoing Alphabet’s commentary during earnings.”
Microsoft Corporation (NASDAQ:MSFT) provides AI-powered cloud, productivity, and business solutions, focusing on efficiency, security, and AI advancements.
1. Amazon.com, Inc. (NASDAQ:AMZN)
Number of Hedge Fund Holders: 328
Amazon.com, Inc. (NASDAQ:AMZN) is one of the 10 AI Stocks Everyone Is Watching Closely. On July 28, Morgan Stanley reiterated the stock as “Overweight” with a $300 price target. The firm believes that Amazon is the largest beneficiary of the big beautiful bill passed by Congress.
Not just Amazon, Morgan Stanley believes that the One Big Beautiful Bill has the potential to pull forward billions of dollars of cash flow for major technology companies.
In an investor note, the analysts noted that Amazon is expected to receive $15B of annual free cash flow benefit between 2025 and 2027 and $11B in 2028. According to them, most of the benefit will be reinvested in Amazon Web Services and generative AI (GenAI) offerings in retail.
However, even if it invests 50% of the annual cash flow, it will be able to drive a “much faster path to billions of annual automation savings.”
“We see AMZN capturing ~$15bn/year in tax benefits. While most will be re-invested in AWS, even investing 50% of the annual cash flow benefit paints a much faster path to billions of annual automation savings.”
Amazon.com Inc. (NASDAQ: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.
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