Beijing has been strongly discouraging Chinese firms from using Nvidia’s artificial intelligence chips, particularly for government-related purposes. However, some tech giants remain keen on using them.
In a report from Reuters, sources reveal that big names such as Alibaba and Tencent have been asking for reassurance that their orders of Nvidia’s H20 model are being processed. The AI chipmaker had regained permission to sell these in China back in July.
According to the sources, they are also closely keeping track of Nvidia’s plans for a more powerful chip, tentatively named the B30A, based on its Blackwell architecture.
The B30A will likely be up to six times more powerful than the H20, and will cost almost double the H20, which currently sells for between $10,000 and $12,000.
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.
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10. SAP SE (NYSE:SAP)
Number of Hedge Fund Holders: 32
SAP SE (NYSE:SAP) is one of the 10 AI Stocks Investors Are Watching Closely. On September 2, the company announced a comprehensive new approach to digital sovereignty and AI innovation through expanded offerings within its SAP Sovereign Cloud portfolio.
Through these offerings, SAP will provide its European customers access to their comprehensive technology stack, including SAP Cloud Infrastructure and SAP Sovereign Cloud On-Site.
European customers will now have access to new deployment models that are designed to meet regulatory and operational requirements while maintaining data sovereignty.
The company has introduced three deployment options. First, the SAP Cloud Infrastructure uses open-source technologies in SAP’s data center network, with all data stored within EU boundaries.
Second, the SAP Sovereign Cloud On-Site offers SAP-operated infrastructure within a customer-owned/customer-selected data center. Third, the Delos Cloud in Germany focuses on public sector transformation needs.
“The digital resilience of Europe depends on sovereignty that is secure, scalable and future-ready. SAP’s full-stack sovereign cloud offering delivers exactly that, giving customers the freedom to choose their deployment model while helping ensure compliance up to the highest standards.”
-Martin Merz, President, SAP Sovereign Cloud.
SAP SE (NYSE:SAP) is a leader in ERP software that leverages artificial intelligence to enhance its enterprise resource planning (ERP) solutions.
9. Marvell Technology, Inc. (NASDAQ:MRVL)
Number of Hedge Fund Holders: 76
Marvell Technology, Inc. (NASDAQ:MRVL) is one of the 10 AI Stocks Investors Are Watching Closely. On September 2, the company announced that the Marvell Structera Compute Express Link (CXL) memory-expansion controllers and near memory compute accelerators have successfully completed interoperability testing with DDR4 and DDR5 memory solutions from Micron Technology, Samsung Electronics, and SK Hynix.
This testing follows Marvell’s recent announcement of successful interoperability of Structera CXL Portfolio with AMD EPYC CPU and 5th Gen Intel Xeon Scalable platforms. This makes Structera the only CXL 2.0 product family that features completed interoperability testing across both leading CPU architectures and all three major memory suppliers. This milestone ensures scalable system design, reduced integration risk, and streamlined qualification. Moreover, OEMs and cloud providers have the flexibility to optimize system designs while maintaining supply chain flexibility.
Interoperability is a crucial part of seamless system performance, particularly as data-centric applications become complex and memory becomes an important part of performance.
The Structera product line includes two CXL device families designed to fulfill performance and scalability needs of next-generation cloud data centers.
The Structera A CXL near-memory accelerators integrates 16 Arm Neoverse V2 cores and multiple memory channels for high-bandwidth memory applications.
Meanwhile, the Structera X CXL memory-expansion controllers enable terabytes of memory to be added to general-purpose servers for high-capacity memory applications.
“As AI and high-performance computing workloads intensify, CXL will help dissolve bottlenecks for demanding workloads that can consume upwards of hundreds of terabytes of memory capacity.”
-Praveen Vaidyanathan, vice president and general manager of Cloud Memory Products at Micron.
Marvell Technology, Inc. (NASDAQ:MRVL) engages in the development and production of semiconductors, focusing heavily on data centers.
8. Alibaba Group Holding Limited (NYSE:BABA)
Number of Hedge Fund Holders: 101
Alibaba Group Holding Limited (NYSE:BABA) is one of the 10 AI Stocks Investors Are Watching Closely. On September 2, Benchmark analyst Fawne Jiang raised the price target on the stock to $195.00 (from $176.00) while maintaining a Buy rating.
Jiang noted how Alibaba missed its first-quarter fiscal 2026 headline consensus expectations due to partially-accounted for asset divestitures including SunArt and Intime, and increased investment in Quick Commerce, which pressured margins.
However, Alibaba’s cloud and ecommerce segments are gaining strength, with cloud delivering a solid beat and guidance pointing toward further acceleration. These aspects reinforce the company’s position as a leading GenAI and cloud infrastructure provider.
“BABA missed F1Q26 headline consensus, largely due to some revenue estimates that didn’t fully factor in asset divestitures (SunArt, Intime) and a sharp uptick in investment toward Quick Commerce, which pressured margins. However, we believe fundamentals are clearly strengthening across its cloud and e-commerce segments. Cloud delivered a solid beat with +26% y/y growth and guided to further acceleration, marking a notable upward revision and reinforcing BABA’s position as China’s leading GenAI and cloud infrastructure provider. In e-commerce, while Quick Commerce impacted margins (~RMB10B in F1Q26, ~RMB50B for FY26), we view it as having strategic potential to be accretive, expanding long term GMV TAM (~RMB1TN guidance), driving user traffic, and supporting long-term ad revenue upside. As a result, we have raised our FY26/FY27 growth forecasts and see potential for market share gains. With these tailwinds, we also see room for multiple expansion and raise our price target to $195.”
Alibaba Group Holding Limited (NYSE:BABA) is an internet giant that offers e-commerce services in China and internationally.
7. Advanced Micro Devices, Inc. (NASDAQ:AMD)
Number of Hedge Fund Holders: 113
Advanced Micro Devices, Inc. (NASDAQ:AMD) is one of the 10 AI Stocks Investors Are Watching Closely. One of the biggest analyst calls on Thursday, September 4, was for Advanced Micro Devices. Seaport downgraded the stock to “Neutral” from buy stating that its supply chain checks reveal slow progress with its artificial intelligence accelerator business.
The firm further revealed how AMD is struggling to grow orders from the many customers that it announced previously at its AI event.
AMD continues to be a viable competitor in the AI accelerator market. However, Seaport believes that it isn’t gaining meaningful share anytime soon.
“While the MI Series of accelerators has shown continued improvements, the market remains challenging with highly demanding customers. In particular, we are concerned that many of their headline customers have only purchased evaluation systems that are unlikely to convert into volume orders for at least one generation of the MI systems. Elsewhere, we are concerned that their progress at customers like Microsoft and Meta, are attracting intense scrutiny as those companies re-evaluate their AI spending plans. Moreover, the company’s use of discounts and other support mechanisms has become more widespread. Finally, we think margins may come under pressure as the company may lose negotiating leverage with current HBM suppliers. While we think the company remains a viable long-term competitor in the AI Accelerator market, the timeframe for them achieving more meaningful share is further out. We downgrade to Neutral.”
Advanced Micro Devices, Inc. (NASDAQ:AMD) develops and sells semiconductors, processors, and GPUs for data centers, gaming, AI, and embedded applications.
6. Tesla, Inc. (NASDAQ:TSLA)
Number of Hedge Fund Holders: 115
Tesla, Inc. (NASDAQ:TSLA) is one of the 10 AI Stocks Investors Are Watching Closely. On September 4, Wolfe reiterated the stock as “Peer Perform,” noting that the backdrop for Tesla in 2026 is uncertain.
“But we are less certain into 2026, as TSLA faces a challenging fundamental backdrop.”
Analysts on Wall Street currently have a consensus “Buy” rating on the stock. The average price target of $329 implies a 2.82% upside; however, the Street-high target of $500 implies an upside of 47.7%.
Tesla, Inc. (NASDAQ:TSLA) is an automotive and clean energy company that leverages advanced artificial intelligence in its autonomous driving technology and robotics initiatives.
5. Salesforce, Inc. (NYSE:CRM)
Number of Hedge Fund Holders: 121
Salesforce, Inc. (NYSE:CRM) is one of the 10 AI Stocks Investors Are Watching Closely. On September 4, Goldman Sachs analyst Kash Rangan reiterated a Buy rating on the stock with a $385.00 price target. Salesforce’s Q2 results modestly topped expectations, though Q3 revenue guidance midpoint came in below consensus, pressuring shares.
Goldman Sachs highlighted how artificial intelligence has the potential to become a “multi-year tailwind” for Salesforce instead of being a disruptive force toward its SaaS business.
It noted encouraging signs for the firm, including modest growth reacceleration in core Sales and Service Clouds (8% YoY vs. 7% prior), growth in Salesforce’s Data Cloud and AI annual recurring revenue (ARR exceeded $1 billion, up ~120% YoY), and 6,000 paid Agentforce deals, with 40% of new bookings from existing customer expansions suggesting healthy progress in AI deployments.
Still, Goldman Sachs believes that Salesforce failed to deliver meaningful reacceleration in F2H26 guidance which has led to a weakness in the stock. Nevertheless, it remains constructive on the shares.
“Furthermore, we should start to see relief to growth as C23 cohorts renew in C26, as opposed to the tough comparisons from C21/22 cohorts that renewed in C24/25. As Salesforce deploys AI internally to extract further efficiencies within the business, we believe the company can potentially scale to 35-40% OpM over the next several years without comprising its ~10% Subscription Revenue growth, coupled with the optionality to deliver modest acceleration without sacrificing OpM expansion.”
Salesforce, Inc. (NYSE:CRM) is a cloud-based CRM company that has gained popularity after it unveiled its AI-powered platform called Agentforce.
4. Apple Inc. (NASDAQ:AAPL)
Number of Hedge Fund Holders: 156
Apple Inc. (NASDAQ:AAPL) is one of the 10 AI Stocks Investors Are Watching Closely. On September 3, TD Cowen analyst Krish Sankar reiterated a Buy rating and $275.00 price target on the stock.
According to the firm, the US District Court for DC’s remedies for Google’s search business is favorable for Apple’s advertising revenues.
This is particularly true for licensing from Google TAC (traffic acquisition cost) payments considering revenue search and Safari search defaults can continue.
Moreover, the non-exclusivity remedies allow Apple to license non-Google GenAI products, expanding Apple’s AI partnerships.
“Search Remedies Leave AAPL Ad Revs Intact, Supportive for Future GenAI Rates; We view the US District Court for DC’s remedies for GOOGL’s Search business as largely favorable for AAPL advertising revs (i.e. licensing from Google TAC payments) as rev sharing and Safari search defaults can continue. Non-exclusivity remedies allow AAPL to license non-GOOGL GenAI products (e.g. OpenAI). GOOGL rev sharing also provides a valuable benchmark for GenAI search competition pricing.”
Apple is a technology company known for its consumer electronics, software, and services.
3. Alphabet Inc. (NASDAQ:GOOGL)
Number of Hedge Fund Holders: 219
Alphabet Inc. (NASDAQ:GOOGL) is one of the 10 AI Stocks Investors Are Watching Closely. On September 3, Rosenblatt analyst Barton Crockett raised the price target on the stock to $224.00 (from $211.00) while maintaining a Neutral rating.
The rating affirmation follows Judge Amit Mehta’s search remedy ruling. Crockett noted that even though the court ruling has taken the near-term potential of breakup to the Apple distribution deal off the table, long-term concerns still remain.
He elaborated that AI chatbots could still challenge Google Search’s dominance in the future. The firm’s Neutral rating reflects these looming AI competition risks that remain and their potential to limit how high the stock trades in the long-run.
“Judge Amit Mehta’s search remedy ruling bolsters long-term competitive risks to Google search from AI chatbots, but takes the near-term potential of breakup or disruption to the Apple distribution deal off the table. While breakup was never widely expected, and our base case had been that Apple payments would also continue, investors understandably are relieved that near-term risks are dissipated. We factor less risk into a higher multiple assumption (13x EV/EBITDA now, 11x before, supported by a mid-teens EBITDA growth rate) to up our price target $13 to $224. We retain our NEUTRAL rating, in the belief that long-term concerns about competitive risks to search will constrain the multiple.”
Alphabet Inc. (NASDAQ:GOOGL) is an American multinational technology conglomerate holding company wholly owning the internet giant Google, amongst other businesses.
2. NVIDIA Corporation (NASDAQ:NVDA)
Number of Hedge Fund Holders: 235
NVIDIA Corporation (NASDAQ:NVDA) is one of the 10 AI Stocks Investors Are Watching Closely. On August 28, UBS analyst Timothy Arcuri reiterated a Buy rating and $205.00 price target on the stock. The firm is only minimally making changes to its estimates and no changes to its price target and buy rating.
The firm acknowledged that Nvidia’s guidance may have fallen short of some investor’s expectations, but commentary suggests a potential upside of $2-5 billion per quarter pending clarification on the mechanics around the 15% fee for licenses to ship H20 chips back to China.
This may offset investor concerns related to guidance.
“There was some noise and a few things to pick at, but against the stock having been up >30% since last earnings, we think the company threaded the needle pretty well in terms of guidance & commentary and we are making only very minimal changes to estimates and no change to our $205 PT and Buy rating. Yes, guidance was maybe a touch below some investor’s expectations, but commentary also suggested that there could be a $2-5B/Q upside relief valve pending codification of the mechanics around the 15% fee for the license to ship H20 back into China. In addition to the China situation, the GB200/300 rack transition is still also creating some remnant noise as Blackwell revenue grew much less than expected and balance sheet inventory (particularly finished goods) spiked higher.”
NVIDIA Corporation (NASDAQ:NVDA) specializes in AI-driven solutions, offering platforms for data centers, self-driving cars, robotics, and cloud services.
1. Microsoft Corporation (NASDAQ:MSFT)
Number of Hedge Fund Holders: 284
Microsoft Corporation (NASDAQ:MSFT) is one of the 10 AI Stocks Investors Are Watching Closely. On September 4, BMO reiterated the stock as “Outperform,” stating that it is sticking with the tech giant.
“Our stock view remains that MSFT is one of our favorite names driven by 1) broad portfolio that includes cloud leadership, 2) largely consistent and effective execution, and 3) reasonable valuation, though admittedly not inexpensive.”
Analysts on Wall Street currently have a consensus “Buy” rating on the stock. The average price target of $630 implies a 24.02% upside; however, the Street-high target of $700 implies an upside of 37.8%.
Microsoft Corporation (NASDAQ:MSFT) provides AI-powered cloud, productivity, and business solutions, focusing on efficiency, security, and AI advancements.
While we acknowledge the potential of MSFT 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 MSFT and that has 100x upside potential, check out our report about this cheapest AI stock.
READ NEXT: 10 AI Stocks Analysts Are Backing Right Now and 10 AI Stocks to Watch Out For in 2025
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