In May, the US and the UAE struck a landmark deal, announcing plans to build one of the largest data centre hubs in Abu Dhabi with U.S. technology. However, a Reuters report has deemed the agreement to be far from concluded. Citing several sources, the report states there are “persistent concerns around security,” which is why the deal hasn’t been finalized yet.
Funded by G42, an Emirati tech firm behind the development of its artificial intelligence industry, the planned 10-square-mile (26-sq-km) site 5GW will be known as “Stargate UAE” and is set to go online in 2026. However, sources briefed on the project have revealed that U.S. officials are yet to determine the security conditions for exporting the advanced chips or how the agreement between the states will be enforced.
Officials are particularly concerned about the UAE’s close relationship with China. They noted that these concerns have been raised during both the Biden administration and Trump’s first term, particularly focusing on the reliability of the Gulf state as a strategic partner.
While it isn’t clear if new concerns have emerged regarding this issue, the unresolved status of the old ones is enough to prevent the deal from being finalized. There is also the possibility of US technology reaching Washington’s competitors regardless of the UAE’s good or bad intentions.
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.
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. CoreWeave, Inc. (NASDAQ:CRWV)
Number of Hedge Fund Holders: 36
CoreWeave, Inc. (NASDAQ:CRWV) is one of the 10 AI Stocks on Wall Street’s Radar. On June 10, DA Davidson analyst Gil Luria reiterated an “Underperform” rating on CoreWeave, Inc. (NASDAQ:CRWV) with a $36.00 price target. The firm stated that CoreWeave had disclosed a pro forma contract financing structure example to analysts yesterday to indicate that shareholders will get some returns during the duration of the contracts being signed.
However, it believes that the disclosure, even if accepted at face value, “very clearly illustrates the exact opposite point.” Luria highlighted how there is no upfront equity and no returns to current equity holders during the contract.
While the company assumes a 15% equity, the analyst also stated that CoreWeave does not have equity capital to invest and is instead relying on other forms of non-project debt. Such a step would require an additional $590 million, which would result in “literally wiping out any cash they are claiming to generate for shareholders.”
The firm also believes that the illustrative interest rate indicates that all of the company’s previous deals are likely unprofitable. Moreover, while AI enthusiasm may likely fuel expansion, it would require the company to raise more than $10 billion in equity capital at the current share price so that it can justify the next two years of projects. This seems as the only significant upside risk to DA’s analysis.
Hedge Fund Resource Center