In this article, we will look at the 10 Best AI Stocks to Buy Under $25.

Artificial intelligence stocks, or AI stocks, have posted blowout gains in the three years to 2025. The MSCI Global Artificial Intelligence Index, for instance, notched 18.93%, 39.16%, and 20.02% in 2023, 2024, and 2025, respectively. However, due to what Morningstar’s analysts described as an “anything-but-AI” sentiment that took hold among investors early in 2026, a broad selloff was triggered across the sector.

However, Morningstar senior equity research analyst Dan Romanoff argued on March 31 that the sector’s fundamentals are still intact. He pointed specifically to generative artificial intelligence, noting that it “remains the largest theme within the sector.” Romanoff explained that software firms are developing and incorporating next-generation AI capabilities into their solutions, while cloud providers are introducing new services and scaling capacity, and semiconductor companies are doing the same.

Interestingly, that thesis was also Morgan Stanley’s position in a March 9 analysis. The bank noted that AI investment now looks more like an industrial build-out than speculative tech spending. It estimated that nearly $3 trillion of AI-related infrastructure investment will flow through the global economy by 2028, and that more than 80% of that spending is still ahead.

“AI is no longer a tech story – it is a macro variable influencing GDP, earnings, credit markets and geopolitics at industrial scale,” the bank said.

Meanwhile, Goldman Sachs strategists believe that the “anything-but-AI” sentiment earlier in the year was a signal. They flagged this as an ongoing rotation toward companies with differentiated AI capabilities. This shift, the strategists said, increases the investable AI opportunities well beyond the handful of mega-cap names that dominated headlines in the few years leading up to late 2025.

With that backdrop in mind, this article identifies 10 AI stocks priced under $25 that could fare well in this environment.

Our Methodology

To determine the 10 best AI stocks to buy under $25, we used financial media reports, industry publications, and company press releases to conduct an in-depth review of AI companies. We focused on companies offering AI-driven products and services, advancing AI innovation, or building infrastructure. From there, we identified companies that are well-placed to benefit from the AI adoption boom and have strong analyst sentiment. We then picked out stocks under $25 with potential gains of 30% or more as of April 17. We also factored in hedge fund ownership as of Q4 2025 using the Inside Monkey database. Finally, we ranked the stocks based on their price upside potential.

Why are we interested in the stocks that hedge funds pile into? The reason is simple: our research shows 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 498.7% since May 2014, beating its benchmark by 303 percentage points (see more details here).

Best AI Stocks to Buy Under $25

10. BigBear.ai Holdings Inc (NYSE:BBAI)

Number of Hedge Fund Holders: 27

Upside Potential: 40.63%

Stock Price: $3.85

BigBear.ai Holdings Inc (NYSE:BBAI) is among the best AI stocks to buy under $25. As it positions itself for more business with the Pentagon, BigBear.ai is strengthening its leadership team. On April 8, the company brought on board Jo Ann Bjornson as chief HR officer and Alex Thompson as chief corporate affairs officer.

Bjornson has held senior HR positions in various companies and entities. She has over 25 years of HR experience in federal contracting and commercial markets. Meanwhile, Thompson has 25 years of experience in brand strategy, government affairs, and marketing.

BigBear.ai provides AI solutions to government and commercial customers, and the company has said that the Pentagon’s AI acceleration strategy plays directly to its strengths. This was the message that the management shared with investors during the release of Q4 2025 results on March 2.

The Pentagon unveiled this strategy in January, and it’s about establishing the US as the world’s leader in AI-enabled fighting force. BigBear.ai sees a big opportunity in this strategy. The company already does business with the Pentagon. In 2023, it was selected for a 10-year US Air Force contract worth $900 million. BigBear.ai was expected to complete work on the awarded tasks under this contract by 2032.

In addition to bolstering the leadership team, BigBear.ai is also strengthening its balance sheet. In a statement accompanying BigBear.ai’s Q4 2025 report, CEO Kevin McAleenan said they closed 2025 in the strongest financial position in the company’s history.

McAleenan mentioned reducing debt by over 90%. He also noted that they have established a solid cash position that gives them the freedom to invest in product enhancements and international expansion.

Based in Virginia, BigBear.ai Holdings Inc (NYSE:BBAI) is a leading provider of AI-driven decision intelligence solutions. Its predictive analytics helps clients to detect threats, optimize operations, and make real-time decisions. BigBear serves government and commercial customers, focusing on industries like defense, intelligence, manufacturing, and supply chain.

9. Lantronix Inc (NASDAQ:LTRX)

Number of Hedge Fund Holders: 23

Upside Potential: 52.17%

Stock Price: $6.19

Lantronix Inc (NASDAQ:LTRX) is among the best AI stocks to buy under $25. The stock has climbed more than 20% over the past six months and soared over 190% over the past 12 months.

On March 24, 2026, Lantronix Inc (NASDAQ:LTRX) presented at the 38th Annual Roth Conference, highlighting its shift from hardware manufacturing to AI‑driven systems and edge intelligence. The company is positioning itself as a leader in “Physical AI,” with strong momentum in drones, robotics, aerospace, defense, and critical infrastructure. Partnerships with FLIR and MediaTek are central to expanding AI capabilities in imaging, robotics, and autonomous systems, while recurring revenue (ARR) is targeted to reach 10–12% of total revenue within two years.

Financially, Lantronix maintains a solid balance sheet and consistent non‑GAAP EPS, with drone revenue projected at $8–$12 million in FY26 and expected to double by FY27. The company is also pursuing M&A opportunities to strengthen AI offerings in drones and infrastructure, while federal contracts and collaborations with Vodafone and major MNOs support growth in defense and critical monitoring. Looking ahead, Lantronix aims to scale AI‑enabled camera intelligence, edge analytics, and autonomous solutions, positioning itself for long‑term growth in both defense and commercial markets.

Lantronix Inc (NASDAQ:LTRX) is among the companies that stand to benefit from the Pentagon’s drone dominance program. The Pentagon is out to acquire more than 300,000 small low-cost drones for warfare over the next two years, and it’s ready to spend more than $1 billion on the drone program. Even a small drone uses a variety of components.

What’s notable is that the Pentagon is emphasizing the domestic supply chain and AI-enabled capabilities for this drone program. With eyes on the Pentagon’s drone program and other opportunities, Lantronix on March 19 announced a partnership with Unusual Machines to develop drone components for US defense programs.

Unusual Machines is a specialist in drone components, while Lantronix is an expert in edge AI and industrial IoT solutions. The companies have decided to bring their capabilities together to build components for AI-enabled autonomous drones suitable for defense application.

Based in California, Lantronix Inc (NASDAQ:LTRX) is a global provider of IoT and Edge AI solutions. It offers hardware, software, and services that enable businesses to manage and secure their connected devices. Lantronix serves public service, industrial, and enterprise customers.