In this article, we will take a look at the 10 Best Affordable AI Stocks to Buy.
As of 2025, considerable attention has been focused on tariff policies, while AI continues to drive significant trends. Earlier this year, AI stocks experienced a notable decline, with leading tech giants heavily invested in AI contributing to major losses in the S&P 500 index. The launch of the Chinese AI model by DeepSeek challenged existing beliefs about the resources required for cutting-edge AI development.
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According to J.P. Morgan Global Investment Strategist, Ajene Oden, the AI innovation by the Chinese startup prompted investors to reconsider the future strategies of major hyperscalers, who remain committed to increasing their capital expenditures.
“We are confident that AI can catalyze significant productivity improvements across various industries. LLMs are now delivering sophisticated outputs at lower costs, mirroring past technological adoption patterns. As competition grows, prices are likely to decrease, encouraging broader AI integration,” said Oden.
Oden also pointed out that the recent earnings data highlights AI’s positive impact, with companies reporting substantial growth fueled by AI demand. According to research by McKinsey, the deployment of generative AI varies by company size, with companies having over $500 million in annual revenue using gen AI throughout more of their organizations compared to smaller companies.
AI could contribute up to $15.7 trillion to the global economy in 2030, according to PwC. This would be more than the current output of China and India combined. Out of this, almost $6.6 trillion is likely to come from productivity growth, and $9.1 trillion is expected to come from consumption side effects.
With these industry shifts in mind, let’s turn to the 10 Best Affordable AI Stocks to Buy.
Our Methodology
To compile the list of the 10 best affordable AI stocks to buy, we shortlisted AI stocks with a forward P/E ratio of less than 15. We then ranked these best affordable AI stocks in the ascending order of upside potential. We took the data for the analysts’ upside from the CNN forecast. We also mentioned the number of hedge funds holding stakes in these stocks, and the data for hedge funds is taken from Insider Monkey’s Hedge Fund database, updated as of Q1 2025. The remaining data was taken on August 7.
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 Best Affordable AI Stocks to Buy
10. Alibaba Group Holding Limited (NYSE:BABA)
Forward P/E: 14.14
Analyst Upside: 23.79%
Number of Hedge Fund Holders: 125
Alibaba Group Holding Limited (NYSE:BABA) is one of the best affordable AI stocks to buy. On July 28, Alibaba Group Holding Limited (NYSE:BABA) revealed its pair of smart glasses powered by its AI models.
Alibaba plans to launch the smart AI glasses by the end of 2025 in China. This marks the Chinese e-commerce giant’s first foray into the product category. Alibaba stated that the Quark AI Glasses will be powered by the firm’s Qwen LLM and its advanced AI assistant called Quark. The company also said its glasses will support hands-free calling, music streaming, real-time language translation, and meeting transcription. The glasses will feature a built-in camera as well.
Quark is currently available as an app in China, and Alibaba is entering into the hardware space as a way to widely penetrate the applications. The Quark AI Glasses are a response to Meta’s smart glasses that were designed in partnership with Ray-Ban. The Chinese tech firm will also compete with another Chinese firm, Xiaomi, which launched its AI glasses about a month ago.
Alibaba Group Holding Limited (NYSE:BABA) is a leading technology infrastructure and market platform provider. The company operates through seven segments and follows an AI-driven strategy. Alibaba has emerged as a leader in open-source AI, especially with its Qwen series of AI models.
9. Zoom Communications Inc. (NASDAQ:ZM)
Forward P/E: 12.69
Analyst Upside: 24.30%
Number of Hedge Fund Holders: 49
Zoom Communications Inc. (NASDAQ:ZM) is one of the best affordable AI stocks to buy. On July 18, Citizens JMP reiterated its Hold rating on Zoom Communications Inc. (NASDAQ:ZM) stock with no price target.
Patrick Walravens from Citizens JMP maintained his rating on ZM, citing mixed data points in its assessment of the company. Amazon announced earlier in February that it is shutting down ‘Chime,’ a competitor to Zoom. This is a positive development for the video conferencing firm, and it will potentially open market opportunities.
Walravens pointed out another positive factor for Zoom that a top 20 bank renewed its contract with the company, indicating continued enterprise-level commitment to the platform. The analyst also mentioned that ZM is fairly valued and remains a promising stock.
Zoom is scheduled to report its Q2 2025 earnings on August 21, with analysts expecting an average earnings per share of $1.38 and revenue of around $1.20 billion.
Zoom Communications Inc. (NASDAQ:ZM) offers an AI-first work platform for human connection. The company provides Zoom Meetings that allow users to access HD video, voice, chat, and content sharing through their devices.
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