The United States and China, two leading powers in military and AI, have refused to sign a voluntary declaration agreed at the Responsible Artificial Intelligence in the Military Domain (REAIM) summit. Meanwhile, only a third of attending countries agreed to the declaration on how to govern deployment of the technology in warfare.
According to numerous attendees and delegates, uncertainty over future transatlantic relations and growing friction between the United States and European allies have made countries hesitant in backing such commitments.
Nevertheless, the pledge is a reflection of the growing concern among some governments that rapid advances in artificial intelligence could outpace existing safeguards, increasing the risk of accidents, miscalculation or even unintentional escalation.
Dutch Defense Minister Ruben Brekelmans believes that countries are facing a “prisoner’s dilemma,” balancing between putting responsible restrictions in place with concerns about falling behind strategic rivals.
Russia and China are moving very fast. That creates urgency to make progress in developing AI. But seeing it going fast also increases the urgency to keep working on its responsible use. The two go hand-in-hand, Brekelmans said in comments to Reuters.
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.
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10. Super Micro Computer, Inc. (NASDAQ:SMCI)
Number of Hedge Fund Holders: 42
Super Micro Computer, Inc. (NASDAQ:SMCI) is one of the 10 AI Stocks to Keep on Your Radar. On February 4, Barclays analyst Tim Long lowered the price target on Super Micro Computer (NASDAQ: SMCI) to $38.00 (from $43.00) while maintaining an “Equal Weight” rating.
Discussing SMCI’s earnings report, Barclays noted how December quarter results exceeded expectations on both revenue and earnings. SMCI posted revenue of $12.7 billion, which represents a 153% quarter-over-quarter increase and also exceeds Barclays’ estimate by more than $2 billion.
However, gross margin came in at 6.4%, which is slightly below the analyst firm’s 6.5% estimate. The management forecast’ fiscal third-quarter revenue to be at least $12.3 billion and lifted its full-year 2026 revenue guidance to at least $40 billion, in line with analysts’ expectations of 66% revenue growth this fiscal year.
Gross margin is anticipated to improve by 30 basis points quarter-over-quarter in the next quarter, albeit still remaining below 7%. The firm added that Data Center Building Block Solutions (DCBBS) is likely to increase in the profit mix.
According to the firm, SMCI’s fiscal 2026 guidance points to a sequential forth-quarter deceleration, but views this as conservatism. It expects momentum to sustain through the second half of the year.
Super Micro Computer, Inc. (NASDAQ:SMCI) designs and manufactures high-performance server and storage solutions for data centers, cloud computing, AI, and edge computing worldwide.
9. Baidu, Inc. (NASDAQ:BIDU)
Number of Hedge Fund Holders: 54
Baidu, Inc. (NASDAQ:BIDU) is one of the 10 AI Stocks to Keep on Your Radar. On February 4, US Tiger Securities analyst Bo Pei raised the price target on the stock to $150.00 (from $135.00) while maintaining a “Buy” rating. The firm is bullish on Baidu, particularly due to its AI ecosystem optionality and monetization catalysts.
The firm believes that Baidu will continue to unlock shareholder value following the recently announced listing of its AI chip subsidiary, Kunlunxin. It is also of the view that Baidu Cloud is well-positioned to benefit from the accelerated adoption of AI across China and that its robotaxi business may see a valuation rerating as investor focus on transitions from AI infrastructure to downstream applications.
For the fourth quarter, the firm’s revenue estimates remain unchanged. However, it has modestly trimmed its non-GAAP EBIT and EBITDA as assumptions around D&A and SBC are refined. Baidu has been actively exploring ways to unlock shareholder value, and the most prominent example has been its decision to spin off and pursue an independent listing of its AI chip subsidiary Kunlunxin.
US Tiger Securities highlighted how Baidu has confidentially filed a Hong Kong IPO application and currently owns an estimated 60%. The company noted that it intends on retaining majority control post-IPO.
Strategically, we view this move as a positive step toward unlocking hidden value while providing Kunlunxin with independent access to capital to support continued AI chip development. We assign a valuation of RMB 100bn to Kunlunxin, implying 15.4x EV/sales on our projected 2026 revenue. We view this multiple as conservative relative to listed peers such as Cambricon Technologies, which currently trades at approximately 31.5x EV/sales.
Even though the firm remains cautious on BIDU’s near-term revenue and earnings growth trajectory, it believes that the stock is increasingly tied to its long-term AI optionality. The firm sees multiple catalysts supporting upside, particularly in robotaxi and AI cloud.
Baidu, Inc. (NASDAQ:BIDU) is a Chinese internet giant and AI pioneer, known for its noteworthy investments in artificial intelligence technology and its position as the dominant search engine within the country.
8. Teradyne, Inc. (NASDAQ:TER)
Number of Hedge Fund Holders: 58
Teradyne, Inc. (NASDAQ:TER) is one of the 10 AI Stocks to Keep on Your Radar. On February 4, Stifel analyst Brian Chin raised the price target on the stock to $325.00 (from $280.00) while maintaining a Buy rating. The firm believes TER’s outlook appears more constructive with upside from AI and semi test share gains.
Stifel’s price target increase follows TER’s upside guidance that demonstrate how artificial intelligence applications now represent more than 70% of the company’s semiconductor test business as of the first quarter.
Management anticipates 2026 revenue to be weighted towards the first-half, though analysts see a 60/40 split between the first and second halves a reflection of conservative around quarterly AI revenue variability and broader pickup in areas like mobile NVIDIA GPU qualification.
Incremental contributions are anticipated in the second half of 2026 with “with interim 30% (or higher) share potential in few years’ time.”
The firm further added that Teradyne has updated its mid-term target model based on the semiconductor test total addressable market (TAM).
Teradyne now pegs its mid-term target model to the semi-test TAM; given a $13B test TAM, TER targets $10.25 EPS (+/-75c) on $6B revenue Reflecting Teradyne’s re-invigorated growth outlook, we reiterate our Buy rating and raise our target price to $325, 38x our CY27E EPS (10% discount to peer).
Teradyne, Inc. (NASDAQ:TER) designs, develops, and manufactures automated test equipment (ATE) and advanced robotics systems for the manufacturing and electronics industries.
7. Datadog, Inc. (NASDAQ:DDOG)
Number of Hedge Fund Holders: 72
Datadog, Inc. (NASDAQ:DDOG) is one of the 10 AI Stocks to Keep on Your Radar. On February 4, KeyBanc analyst Eric Heath lowered the price target on the stock to $155.00 (from $170.00) while maintaining an Overweight rating. The firm believes in DDOG’s positioning but needs clarity on 2026 guide.
The firm noted how DDOG needs to mirror a setup similar to Q3, with acceleration in its core business and stability in revenue contribution from OpenAI. Even if the company posts another modest beat of roughly 4%, consistent with the previous quarters, the firm expects management’s initial guidance to be more cautious than consensus estimates.
If management follows its previous FY revenue guidance approach, it may assume slightly lower net new revenue year-over-year for the core business. Under the framework, the implied revenue growth may be in high-teens.
KeyBanc noted OpenAI to be a significant variable, potentially representing up to $300 million in revenue and an estimated 90% of Datadog’s AI-native customer segment. If Datadog’s guidance assumes flat growth for OpenAI, then total revenue guidance may be in the mid-to-high teens percentage range. This is compared to KeyBanc’s estimate of 20% and consensus expectations of 21% growth.
Overall, investor sentiment for DDOG remains mixed, while feedback has been largely positive on DDOG’s innovation, leadership, and potential AI tailwinds. Concerns such as price pressure also remain.
Investor sentiment on Datadog we believe is the most debated within our coverage. Investor feedback is generally positive on Datadog’s innovation, category leadership, potential AI tailwinds, and opportunity to be successful in security. However, the medium-term concern is price pressure from Palo and incremental competition from data platform vendors, while the near-term concern remains 2026 guidance dynamics and headline risk from potential OpenAI churn. And in this software environment, anything that isn’t indisputably clean doesn’t work T+1.
Datadog, Inc. (NASDAQ:DDOG) offers a cloud-based SaaS platform for monitoring and analytics, specializing in cloud computing and AI-powered cybersecurity products.
6. Palantir Technologies Inc. (NASDAQ:PLTR)
Number of Hedge Fund Holders: 81
Palantir Technologies Inc. (NASDAQ:PLTR) is one of the 10 AI Stocks to Keep on Your Radar. On February 2, RBC Capital analyst Rishi Jaluria reiterated an Underperform rating on the stock with a $50.00 price target. The firm holds its bearish view on PLTR despite its strong guidance and beat.
The firm highlighted how Palantir reported a solid beat, with 2026 revenue growth guidance of 61% ahead of consensus at 41%. Fourth quarter revenue beat consensus by 5%, and shares rose roughly 8% after hours. Growth accelerated meaningfully across both commercial and government segments. Commercial revenue was up 82% year-over-year and government revenue up 60%, both exceeding consensus.
Margins and earnings also surprised to the upside. First-quarter revenue guidance of $1,532–$1,536M implies an estimated 74% YoY increase and is well above Street expectations. Palantir also projected an adjusted operating margin midpoint of an estimated 72%, well above the consensus of 48.3%.
Adj. operating margin was 57% (vs. consensus: 52.3%), while adj. EPS was $0.25 (consensus: $0.23). 1Q revenue guidance calls for $1,532–$1,536M (~74% YoY), above consensus at ~$1,326M, while adj. operating margin midpoint was set at ~72%, above consensus of 48.3%. 2026 revenue guidance was set at $7,182–$7,198M (above consensus at ~$6,295M) and US Commercial revenue guidance exceeds $3.14B which represents at least 115% YoY growth. 2026 Adj. operating margin midpoint was set at ~71%, above consensus of 49.9%, while adjusted free cash flow guidance was set at $3.925–$4.125B, above consensus of ~$2.8B. On the earnings call (5:00pm ET), we look for more detail on AIP upselling trends, updates on the federal spending environment, and any one-time nuances.
Palantir Technologies Inc. (NASDAQ:PLTR) is a leading provider of artificial intelligence systems.
5. Advanced Micro Devices, Inc. (NASDAQ:AMD)
Number of Hedge Fund Holders: 115
Advanced Micro Devices, Inc. (NASDAQ:AMD) is one of the 10 AI Stocks to Keep on Your Radar. On February 4, Baird analyst Tristan Gerra reiterated an Outperform rating on the stock with a $300.00 price target. The firm anticipates that AMD will benefit from robust AI demand and GPU momentum.
The research firm cited several positive developments in the company’s AI-related business segments. One of these includes an acceleration in AI-related x86 server CPU demand. While it did acknowledge that higher pricing for commodities is negatively impacting the PC Total Addressable Market, it noted that it is offset by ongoing Client share gains.
Moreover, there has been continued strength in AI GPU demand while Mi308 sales have resumed. Baird also highlighted that the Mi450 product and AMD’s partnership with OpenAI remain on track.
Overall, the firm has expressed optimism about AMD’s future AI unit forecasts, citing meaningful upside in 2026.
We continue to see meaningful upside in 2026 AI units forecasts versus a quarter ago expectations, while we expect the ramp of Mi450 to result in market share gains for AMD. Outperform-rated.
Advanced Micro Devices, Inc. (NASDAQ:AMD) develops and sells semiconductors, processors, and GPUs for data centers, gaming, AI, and embedded applications.
4. Tesla, Inc. (NASDAQ:TSLA)
Number of Hedge Fund Holders: 115
Tesla, Inc. (NASDAQ:TSLA) is one of the 10 AI Stocks to Keep on Your Radar. On February 4, Wolfe Research analyst Emmanuel Rosner said that it sees a “catalyst rich” year ahead for the EV maker despite fundamental concerns and that investors are still looking out for more progress.
The firm highlighted several potential catalysts for Tesla, including the Optimus launch in Q1, Cybercab in April, new robotaxi markets, FSD updates, and a new Megapack facility launch. The firm contended that even though the timing of these initiatives may shift, Tesla’s planned spending increase is a reflection of strong company confidence.
As it relates to the stock, we remain tactically constructive, with a steady stream of potential catalysts ahead. Of course, it’s difficult to have high confidence in the success of all of TSLA’s initiatives, especially as timing can shift around. But ultimately, the company’s plan to ramp up spending considerably suggests they are very confident.
Investors will be looking out for significant progress in 2026 across key performance indicators. These include robotaxi expansion, initial Optimus production ramp, and unsupervised FSD expansion.
Tesla, Inc. (NASDAQ:TSLA) is an automotive and clean energy company that leverages advanced artificial intelligence in its autonomous driving technology and robotics initiatives.
3. Apple Inc. (NASDAQ:AAPL)
Number of Hedge Fund Holders: 166
Apple Inc. (NASDAQ:AAPL) is one of the 10 AI Stocks to Keep on Your Radar. On February 4, UBS reiterated the stock as “Neutral” stating that its checks show Apple App Store checks show revenues continue to grow.
On a reported basis, global App Store revenue grew ~7%, roughly in-line with the ~6% growth in November and December.
Similarly, data on developer revenue from SensorTower shows that Apple’s (AAPL) App store revenue increased to $3.4B, or 6.3% year-over-year, after 35 days in fiscal Q2, as reported by BofA analyst Wamsi Mohan.
Mohan noted that for January, App store revenue increased 7.0% year-over-year globally, outperforming app store download growth of 3.6%. The firm holds a “Buy” rating on the stock with a $325 price target.
Apple is a technology company known for its consumer electronics, software, and services.
2. Broadcom Inc. (NASDAQ:AVGO)
Number of Hedge Fund Holders: 183
Broadcom Inc. (NASDAQ:AVGO) is one of the 10 AI Stocks to Keep on Your Radar. On February 5, Jefferies analyst Blayne Curtis reiterated a Buy rating on the stock with a $500.00 price target. The firm has reiterated AVGO as its Top Pick, feeling confident that its fundamentals will drive outperformance.
Jefferies highlighted two overhangs for Broadcom, including the sustainability of AI spend and COT distribution. However, Google’s capital expenditure guidance has been a “significant vote of confidence” for increasing AI spending, and so is the capital raising progress from other players including OpenAI, xAI, and Oracle.
Addressing concerns about Broadcom’s custom on-package (COT) business, Jefferies noted that AVGO is well ahead of MediaTek on v8 chips and will be “even further ahead” with v9 chips in both timing and capabilities.
AVGO and MTK are working on two different SKUs (AVGO v8ax and MTK v8x) and we believe most, if not all, of the demand will be for the higher performance AVGO chip, similar to what happened with v6e vs v7x.
The firm’s bottom-up model projects 6 million total units for Google in calendar 2027, with 85-90% of that business going to Broadcom. It also sees room for that overall number to move up further.
Meanwhile, networking also continues to accelerate, likely even outpacing ASICs in the quarter supported by the TH6 ramp, DSP share gains, and China strength.
We reiterate AVGO as our Top Pick and expect the results will speak for themselves.
Broadcom is a technology company uniquely positioned for the AI revolution, thanks to its custom chip offerings and networking assets.
1. NVIDIA Corporation (NASDAQ:NVDA)
Number of Hedge Fund Holders: 234
NVIDIA Corporation (NASDAQ:NVDA) is one of the 10 AI Stocks to Keep on Your Radar. On February4, Wolfe reiterated the stock as “Outperform,” urging investors to be patient with Nvidia shares. The firm believes Nvidia’s valuation has become compelling once more, and that its long-term earnings trajectory remains intact.
Our positive call on NVDA (we added NVDA to the Wolfe Alpha List last month) is based on our view of fundamentals, and not about seasonal trading trends.
Wolfe highlighted how “over the past 3 years, the majority of NVDA’s performance occurred in the Jan-Aug timeframe,” but that the seasonal trend only “perhaps help[s] to explain the stock’s underperformance over the last 2 quarters.”
The firm sees a clear path to upside in estimates for CY26 and CY27 for the AI chipmaker. This is driven partly by continued unit growth, but also particularly because of pricing tailwinds as Rubin and Rubin Ultra ramp.
NVIDIA Corporation (NASDAQ:NVDA) specializes in AI-driven solutions, offering platforms for data centers, self-driving cars, robotics, and cloud services.
While we acknowledge the potential of NVDA 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 NVDA and that has 100x upside potential, check out our report about this cheapest AI stock.
READ NEXT:10 AI Stocks Analysts Are Watching and 10 Buzzing AI Stocks on Market Radar.
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