According to Evercore ISI, the artificial intelligence-driven equity rally may still be in its early stages despite growing concerns about a bubble.
“Discussion of ‘Bubbles’ has officially entered the market dialogue.”
Led by strategist Julian Emanuel, the firm said there is a 25% chance the S&P 500 could rise past its 2026 target of 7,750 and reach 9,000 by year-end 2026.
Emanuel believes that “a Bubble has a long way to go,” hinting at Alan Greenspan’s famous “irrational exuberance” warning in 1996 that preceded huge tech gains.
Current sentiment and AI stock gains remain modest, the firm noted.
“Not only would we expect to see a Bullish surge, but the mountain of cash [would] be deployed and margin used extensively.”
Even though there may be market turbulence, the firm advises investors to own the “Mag 7” AI enablers, adopters and adapters and using options for “limited risk/theoretically unlimited reward participation.”
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).
10. MongoDB, Inc. (NASDAQ:MDB)
Number of Hedge Fund Holders: 75
MongoDB, Inc. (NASDAQ:MDB) is one of the 10 AI Stocks in Focus on Wall Street. On September 18, Bernstein SocGen Group analyst Firoz Valliji reiterated an Outperform rating on the stock with a $338.00 price target. The reiteration follows MongoDB’s analyst day held in New York City where the company presented to investors and analysts.
According to the firm, MongoDB took the opportunity to share a “well-balanced mid-term guidance” which provides a “floor for investor expectations.”
“MongoDB hosted their analyst day yesterday in NYC… Overall, we think MongoDB shared a well-balanced mid-term guidance, that provides a floor for investor expectations, with substantial upside potential.”
MongoDB, Inc. (NASDAQ:MDB) provides a general-purpose database platform worldwide that integrates operational, unstructured, and AI-related data to streamline building applications.
9. ASML Holding N.V. (NASDAQ:ASML)
Number of Hedge Fund Holders: 78
ASML Holding N.V. (NASDAQ:ASML) is one of the 10 AI Stocks in Focus on Wall Street. On September 22, Morgan Stanley upgraded the stock to “Overweight” from Equal Weight with a price target of €950. The firm sees “early signs of improvement” for ASML.
“Since peaking last year (Jul’24), earnings forecasts have been revised significantly downwards for ASML, as is typical in a downcycle, with a marked effect on the share price (down 45% peak to trough).”
The firm said its upgrade is a reflection of positive earnings revisions and cyclical recovery despite market concerns.
“Our upgrade reflects the potential for positive earnings revisions and cyclical recovery – focus to shift to 2026-27 debate. FY27e EPS could approach €33 (8% ahead of consensus) on strength in memory, mix effects and cost controls. We expect order momentum to build before year-end 2025 for delivery in late 2026/27. Despite the recent rally, we think the share price still reflects flat layer count, weak China, and minimal sales from Intel and Samsung. We upgrade ASML to Overweight, with a PT of €950, implying 20% upside.”
ASML Holding N.V. (NASDAQ:ASML) develops and sells advanced semiconductor equipment, including lithography, metrology, and inspection systems for chip manufacturing.
8. Applied Materials, Inc. (NASDAQ:AMAT)
Number of Hedge Fund Holders: 81
Applied Materials, Inc. (NASDAQ:AMAT) is one of the 10 AI Stocks in Focus on Wall Street. On September 22, Morgan Stanley analyst Shane Brett upgraded the stock from Equal Weight to Overweight with a price target of $209.00 (from $172.00). The bank finds that shares of Applied Materials are compelling.
“AMAT currently trades at a 25% discount to [Lam Research] vs 10% average since 2023, and our new PT implies a 15% discount.”
The firm particularly cites AMAT’s high exposure to DRAM spending and potential benefits from new wafer additions, lifting its 2026 EPS estimate for the stock to $10.45 from $9.58 and its price target to $209 from $172.
“With a 3:1 bull:bear skew, the most leverage to greenfield DRAM in our coverage, and our view that China, ICAPS, and leading edge logic are derisked, we think risk reward is skewed to the upside.”
Applied Materials, Inc. (NASDAQ:AMAT) is a leader in materials engineering solutions engaged in the provision of manufacturing equipment, services, and software to the semiconductor, display, and related industries.
7. Intel Corporation (NASDAQ:INTC)
Number of Hedge Fund Holders: 82
Intel Corporation (NASDAQ:INTC) is one of the 10 AI Stocks in Focus on Wall Street. On September 19, Citi downgraded the stock to “Sell” from Neutral Citi following its agreement with Nvidia on Thursday. The firm raised the price target to $29 from $24 on the stock.
While others believe that Nvidia’s partnership with Intel is going to be a turning point for the struggling chipmaker, Danely thinks otherwise. According to him, Intel is already pricing in foundry success, which he believes is highly unlikely.
He has warned that Intel’s foundry unit may not be successful in effectively competing with TSM and similar established players. The partnership with Nvidia may provide it with a short-term boost, but will not be able to fix its deeper problems in the manufacturing business.
The downgrade, therefore, comes mainly from valuation. Danley believes that Intel has rallied enough to levels that assume turnaround is complete. Since the foundry business is uncertain, there is more risk than reward at the current price.
“We downgrade Intel from Neutral to Sell due to Intel’s valuation and our belief that the stock is pricing in success in its leading-edge foundry business, which we believe has minimal chance to succeed.”
Intel Corporation (NASDAQ:INTC) designs, manufactures, and sells computer products and technologies, delivering data storage, computer, networking, and communications platforms.
6. Micron Technology, Inc. (NASDAQ:MU)
Number of Hedge Fund Holders: 94
Micron Technology, Inc. (NASDAQ:MU) is one of the 10 AI Stocks in Focus on Wall Street. On September 19, Barclays reiterated the stock as “Overweight” and raised its price target on the stock to $175 per share from $140 ahead of earnings on Sept. 23.
Analysts at the firm noted that they see near-term NAND upside and a higher long-term high bandwidth share trajectory for the stock.
“We think MU will put up results modestly ahead of the pre-announce midpoint and guide materially stronger on the back of NAND volume/ASP [average selling price].
Micron Technology, Inc. (NASDAQ:MU) develops and sells memory and storage products for data centers, mobile devices, and various industries worldwide.
5. Tesla, Inc. (NASDAQ:TSLA)
Number of Hedge Fund Holders: 115
Tesla, Inc. (NASDAQ:TSLA) is one of the 10 AI Stocks in Focus on Wall Street. On September 22, Piper Sandler reiterated the stock as “Overweight” and raised its price target on the stock to $500 per share from $400.
The firm believes that Tesla is positioned for growth due to its lead in AI. This is despite Chinese competitors trying to copy its designs.
“We are boosting our price target to $500, following a trip to China. After meeting with Chinese EV makers, we can see why Elon Musk respects these ‘fast followers’ so much. Indeed, vertically-integrated Chinese OEMs may be Tesla’s #1 competitive threat. But when it comes to ‘real world’ A.I., these companies look to Tesla for guidance – not the other way around.”
According to the firm, this AI technology powers Tesla’s robo-taxi fleet and its Optimus humanoid robots—which are the two very businesses poised for growth over the next few years.
“At some point in the next year or so, we think investors will start focusing on the size of the FSD-equipped fleet, rather than the number of new deliveries sold into the fleet each quarter.”
Moreover, the company’s monetization of already sold vehicles could enhance the EV maker’s valuation as well.
“It’s true that the fleet size depends on continued sales, but there are millions of existing Tesla vehicles on the road that Tesla can monetize, regardless of new delivery trends.”
Tesla, Inc. (NASDAQ:TSLA) is an automotive and clean energy company that leverages advanced artificial intelligence in its autonomous driving technology and robotics initiatives.
4. Apple Inc. (NASDAQ:AAPL)
Number of Hedge Fund Holders: 156
Apple Inc. (NASDAQ:AAPL) is one of the 10 AI Stocks in Focus on Wall Street. On September 22, Wedbush reiterated the stock as “Outperform” and raised its price target citing strong iPhone 17 demand. Ives is “positively surprised” by iPhone 17’s demand trajectory, stating how units seem to be tracking 10% to 15% ahead of iPhone 16 so far.
“We are raising our price target to $310 from $270 based on the early strong demand signs coming out of the iPhone 17 cycle. With iPhone 17 officially going on sale over the weekend we are positively surprised on the demand trajectory with units that now appear to be tracking 10%-15% ahead of iPhone 16 thus far.”
The firm believes that iPhone 17 is receiving stronger-than-expected demand, and that the iPhone Air could be a surprise hit based on the firm’s store checks. Overall, Wedbush believes that the Street is underestimating the iPhone cycle and it’s a Ryder Cup Bethpage moment for the tech giant after few years of disappointing growth.
“We believe supply checks in Asia will result in production increases of roughly 20% for base iPhone 17 and Pro models. The new “iPhone Air could be the surprise” of this Apple upgrade cycle based on our numerous store checks over the weekend speaking with Apple customers. Tracking shipping times we are seeing particularly strong demand for iPhone 17 Pro models which is a positive sign for Apple. Heading into this iPhone 17 cycle we were expecting this upgrade cycle to be a good, but not great one. Instead the combination of a pent-up consumer upgrade cycle with our estimates of 315 million of 1.5 billion iPhones globally not upgrading their iPhones in the last 4 years, coupled with some design changes/enhancements have been the magical formula out of the gates. We believe iPhone unit Street estimates of roughly 230 million for FY26 could be conservative and now in the 240 million to 250 million area at this pace. The Street is clearly underestimating this iPhone cycle in our view and its a Ryder Cup Bethpage moment for Cook and Cupertino after a few years of disappointing growth years.”
Apple is a technology company known for its consumer electronics, software, and services.
3. NVIDIA Corporation (NASDAQ:NVDA)
Number of Hedge Fund Holders: 235
NVIDIA Corporation (NASDAQ:NVDA) is one of the 10 AI Stocks in Focus on Wall Street. On September 22, Bernstein reiterated the stock as “Buy” stating that it’s sticking with shares of Nvidia.
“The datacenter opportunity is enormous, and still early, with material upside still possible.”
Analysts on Wall Street currently have a consensus “Buy” rating on the stock. The average price target of $211 implies a 20.29% upside; however, the Street-high target of $389.73 implies an upside of 121.65%.
NVIDIA Corporation (NASDAQ:NVDA) specializes in AI-driven solutions, offering platforms for data centers, self-driving cars, robotics, and cloud services.
2. Alphabet Inc. (NASDAQ:GOOGL)
Number of Hedge Fund Holders: 219
Alphabet Inc. (NASDAQ:GOOGL) is one of the 10 AI Stocks in Focus on Wall Street. On September 22, Truist reiterated the stock as “Buy” and raised its price target to $285 per share from $225.
Analysts remain positive on the stock highlighting that Google still controls 90% of the Search market despite new Gen-AI platforms growing in users and usage.
AI platforms are gaining users but drive merely 1% of total referral traffic and immaterial conversions so far.
“We remain constructive on GOOGL as we believe the company continues to dominate the Search mkt at 90%+ even as new Gen-AI platforms are growing users & usage. Our analysis suggests that Google dominates the all-important commercial queries while AI search accounts for only ~1% of total referral traffic and an immaterial % of conversions so far. A look at growth in online search volume & use cases suggests the advent of AI chatbots is expanding search’s TAM not cannibalizing it. Interestingly, Google’s AIO prioritizes informational queries over commercial intent, minimizing its impact on ad revenue. We’re introducing FY26 quarterlies & moving our PT to $285 for FYE26.”
Alphabet Inc. (NASDAQ:GOOGL) is an American multinational technology conglomerate holding company wholly owning the internet giant Google, amongst other businesses.
1. Meta Platforms, Inc. (NASDAQ:META)
Number of Hedge Fund Investors: 260
Meta Platforms, Inc. (NASDAQ:META) is one of the 10 AI Stocks in Focus on Wall Street. On September 22, Monness, Crespi, Hardt analyst Brian White reiterated a Buy rating and $860.00 price target on the stock. The firm’s rating affirmation is a reflection of Meta’s strategic innovations and growth potential.
Meta showcased its advancements at Meta Connect 2025 with its new AI glasses and metaverse innovations. The firm believes that Meta is poised to benefit from the digital ad trend, expanding its platform and innovate with AI.
It further noted how the star of the keynote was Meta Ray-Ban Display, which has been described as, “the most advanced AI glasses we’ve ever sold with a full-color, high-resolution display that’s there when you want it and gone when you don’t.” The glasses have the ability to support messages, photos, translations, Meta AI, and other features.
“Taking AI Glasses to the Next Level with Display AI Glasses. The star of the keynote was Meta Ray-Ban Display, described as, “the most advanced AI glasses we’ve ever sold with a full-color, high-resolution display that’s there when you want it and gone when you don’t.” The display supports messages, photos, translations, Meta AI, and more. Plus, a Meta Neural Band enables users to interact (e.g., scroll, click) with the AI glasses. Soon, users will be able to write messages by simply moving their fingers. The combination of a display and Meta Neural Band will provide users with access to features such as Meta AI with visuals, messaging, video calling, pedestrian navigation, live captions, live translation, and more. Plus, the new AI glasses include an 18-hour battery life. Meta Ray-Ban Display starts at $799.”
While we acknowledge the potential of META 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 META and that has 100x upside potential, check out our report about this cheapest AI stock.
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