Digital health’s 2025 shape is pretty clear: money is flowing again, AI is getting absorbed into real workflows, and policy is quietly forcing the pipes to talk to each other. Rock Health’s Q3 2025 review shows $3.5 billion across 107 deals and $9.9 billion year-to-date, already ahead of 2024 by this point, which tells you investors still back digitally delivered, data-heavy care even after the post-2021 chill.
On the demand side, telehealth didn’t crash back to 2019, HHS tracking in May 2025 still shows elevated virtual use, especially in behavioral and chronic-care contexts, because insurers and states kept enough flex in their rules.
The real 2025 step-change is clinical AI creeping toward normal: the AMA’s 2024/early-2025 survey says roughly two-thirds of physicians are already using health AI, up from barely over a third a year earlier, and they mainly want admin offload and triage, not sci-fi diagnostics. That’s unusually fast physician adoption.
All of this is being hardened by regulation: ONC’s TEFCA build-out plus the HTI interoperability rules from ONC/CMS in 2024–25 mean data exchange is no longer optional plumbing; it’s becoming a market access requirement for digital tools. Net direction: fewer gimmicks, more reimbursable virtual care, AI inside the visit, and products that can actually plug into national exchange.
Methodology
For our list, we picked stocks from the digital healthcare industry that had the highest number of hedge funds holding stake in them as of Q2, 2025. We ranked the list as such. Our source for industry sampling was stockanalysis.com.
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 427.7% since May 2014, beating its benchmark by 264 percentage points (see more details here).
10. Tempus AI, Inc. (NASDAQ:TEM)
Number of Hedge Fund Holders: 27
Tempus AI, Inc. (NASDAQ:TEM) is one of the best digital health stocks to buy now.
Wall Street sentiment toward Tempus AI strengthened on November 5, 2025, following the company’s Q3 results, with three major firms reiterating positive ratings and updating their targets. Canaccord Genuity kept its Buy rating but trimmed its target slightly from $110 to $95.
In its commentary, Canaccord noted that “AI deployment at scale in clinical practice could drive strong long-term revenue growth for Tempus AI.”
Tempus’ blowout Q3 wasn’t magic; it was mix and scale. The Ambry-boosted genomics engine did the heavy lifting, with oncology test volumes up ~27% and hereditary testing surging, pushing total genomics revenue to ~$253M and overall sales to $334M. Data/Services grew too, with Insights licensing leading there, so fixed costs spread wider, lifting gross profit to ~$210M and tipping adjusted EBITDA positive. Yet GAAP stayed red thanks to stock comp, new Ambry amortization, and a $12M debt-extinguishment hit. Management raised the full-year bar because these growth levers look durable; the market’s wobble was about costs and future spend, not demand.
Tempus AI, Inc. (NASDAQ:TEM) is a health-tech company that applies artificial intelligence to clinical and molecular data, aiming to personalize treatment, especially in oncology, and extend its technology across a wider range of diseases.
9. GeneDx Holdings Corp. (NASDAQ:WGS)
Number of Hedge Fund Holders: 30
GeneDx Holdings Corp. (NASDAQ:WGS) is one of the best digital health stocks to buy now.
On October 29, 2025, Guggenheim lifted GeneDx (NASDAQ: WGS) to a $170 price target (Buy) after the company’s blow-out Q3 announcement a day earlier. GeneDx had just reported revenue of $116.7 million, up 52% year over year and roughly ~12% above Street; exome and genome revenue reached $98.9 million, up 65%, with exome/genome test volumes up 33%. Gross profitability widened too: adjusted gross margin improved to 74% (GAAP 72%), and adjusted net income rose to $14.7 million.
That print underpins Guggenheim’s call-outs, with exome and genome volumes still compounding, ASPs running higher, and gross margin trending up, hence the bigger target. Management also raised full-year 2025 guidance to $425–$428 million in revenue and 53–55% growth in exome/genome revenue, alongside a 70–71% adjusted gross-margin guide.
Crucially, Guggenheim addressed the 2026 spend comments: even with stepping up opex next year, the firm doesn’t read that as a return to negative EPS, framing it instead as investment against a now-proven scale curve in pediatric and rare-disease genomics.
GeneDx Holdings Corp. (NASDAQ:WGS) specializes in genomic testing, with a focus on whole-exome and whole-genome sequencing for pediatric and rare disorders. Its offerings also include data solutions that support clinical decision-making and precision medicine.
8. Teladoc Health, Inc. (NYSE:TDOC)
Number of Hedge Fund Holders: 31
Teladoc Health, Inc. (NYSE:TDOC) is one of the best digital health stocks to buy now.
In October 2025, Evercore ISI analyst Elizabeth Anderson issued two ratings on Teladoc Health, both times maintaining an In-Line stance while adjusting the firm’s price target in opposite directions. On October 8, Anderson raised the price target from $8.00 to $9.00. Three weeks later, on October 30, she reversed that move following the company’s Q3 earnings call, lowering the target back to $8.00. No additional commentary was made publicly available alongside either rating.
Teladoc Health announced Q3 results on October 29. Revenue dipped because BetterHelp shrank while Teladoc pulled back on performance marketing and pushed insurance acceptance, and access fees softened. Integrated Care grew, but the mix still hurt profitability: BetterHelp’s 1.6% margin versus Integrated Care’s 17.0% meant an 8% decline in the lower-margin segment pulled group adjusted EBITDA down 16% to $69.9M. The GAAP loss widened largely due to non-cash charges and amortization, not collapsing demand. International growth of 12% partly offset a 5% U.S. decline. Guidance implies discipline: modest Integrated Care growth with mid-teens margins, and a slow BetterHelp rebuild as channels reset and insurance adoption trades near-term revenue for durability.
Teladoc Health, Inc. (NYSE:TDOC) is a virtual care company that offers telehealth services across a range of clinical areas including general medicine, mental health, and chronic condition management. It operates through a platform that integrates clinicians, AI, and analytics to deliver care remotely.
7. 10X Genomics, Inc. (NASDAQ:TXG)
Number of Hedge Fund Holders: 34
10x Genomics, Inc. (NASDAQ:TXG) is one of the best digital health stocks to buy now.
On October 29, 2025, 10x Genomics announced the launch of its next-generation Chromium Flex assay, designed to help researchers dramatically scale up single-cell experiments. The upgraded system introduces a 96-well plate format that supports up to 384 samples and processes as many as 100 million cells per week. It integrates with automated workflows, allowing scientists to multiplex large numbers of samples while minimizing reagent waste.
The new assay builds on the company’s existing Flex chemistry and is aimed at two key areas: high cell-number applications like CRISPR screens, and high sample-number applications such as FFPE-based translational research. 10x says this release will allow labs to achieve throughput levels previously only possible with bulk methods, while retaining single-cell resolution. CTO Michael Schnall-Levin called it a “transformational step forward” for foundational and translational research.
Chromium Flex is now globally available and targets academic, biotech, and pharma labs that require automated, high-throughput solutions for precision cell profiling.
10x Genomics, Inc. (NASDAQ:TXG) is a life sciences tools company that develops platforms for single-cell and spatial biology. Its technology enables high-resolution molecular analysis across oncology, immunology, neuroscience, and other research domains.
6. Doximity, Inc. (NYSE:DOCS)
Number of Hedge Fund Holders: 41
Doximity, Inc. (NYSE:DOCS) is one of the best digital health stocks to buy now.
On November 3, 2025, Morgan Stanley maintained its Equal-Weight rating on Doximity and held its price target steady at $62. The firm’s analyst Craig Hettenbach cited third-quarter checks indicating stronger-than-expected growth, driven in large part by the company’s video module business. The note suggested that adoption momentum in this segment may be outperforming earlier expectations.
In addition, the analyst addressed concerns around potential competitive pressure from OpenEvidence, stating that it has seen no overlap or measurable impact on Doximity’s business from that company so far. While the rating remained neutral, the commentary pointed to a stable outlook supported by product-driven growth within key channels.
Numbers came later that week, on November 6, when Doximity reported Q2 FY26 revenue of $168.5 million, up 23% year over year, and adjusted EBITDA of $100.8 million (≈60% margin). Management guided Q3 FY26 revenue to $180–$181 million (~7% YoY) and FY26 revenue to $640–$646 million (~13% YoY).
Doximity, Inc. (NYSE:DOCS) is a digital platform built for medical professionals, offering tools for networking, telehealth, and physician marketing. The company provides a HIPAA-compliant communication suite and works with pharmaceutical and hospital systems to deliver targeted outreach to clinicians across the United States.
5. Hinge Health, Inc. (NYSE:HNGE)
Number of Hedge Fund Holders: 47
Hinge Health, Inc. (NYSE:HNGE) is one of the best digital health stocks to buy now.
On November 5, 2025, Piper Sandler nudged its Hinge Health, Inc. (NYSE:HNGE) target to $71 (Overweight) after a Q3 that ran hotter than the models. Revenue landed at $154.2 million, up 53% year over year and roughly $12 million above consensus (FactSet/Street was about $142–$142.5 million). Piper said the beat was powered by yield improvements, and that upside flowed through at a 93.4% incremental margin to adjusted operating income; Hinge itself reported non-GAAP operating income of $30.4 million and non-GAAP gross margin of 83%.
Guidance backed the momentum: Q4 revenue was guided to $155–$157 million, comfortably ahead of the Street’s ~$145.5 million, and the company raised its 2025 revenue outlook to $572–$574 million versus consensus near $550.6 million. Piper’s read was that the current yield trajectory still looks conservative relative to those updated targets, with efficiency gains in care delivery doing the heavy lifting.
Hinge Health, Inc. (NYSE:HNGE) is a musculoskeletal digital clinic that offers personalized physical therapy and pain management programs through a combination of wearable sensors, app-based coaching, and licensed clinical care. Its platform serves employers, health plans, and individuals across the United States.
4. Waystar Holding Corp. (NASDAQ:WAY)
Number of Hedge Fund Holders: 48
Waystar Holding Corp. (NASDAQ:WAY) is one of the best digital health stocks to buy now.
On October 30, 2025, following the company’s third-quarter earnings, Mizuho Securities lifted its target from $48 to $50 and reiterated an Outperform rating, citing strong demand for Waystar’s revenue cycle management solutions. The firm highlighted that adoption of AI-driven claims denial tools was a key contributor to the company’s above-consensus performance.
Waystar Holding Corp. (NASDAQ:WAY) released their Q3 report on October 29, 2025. Double-digit growth came from steady transaction volume, expanding client adoption, and early Iodine Software cross-sell, which lifted revenue 12% to $268.7M and kept adjusted EBITDA strong at $112.7M with a 42% margin. Cost discipline and scale did the rest, converting more of each dollar into profit and pushing net income to $30.6M. Management raised full-year targets, signaling confidence that the Iodine integration and pipeline can carry momentum into 2026: revenue to $1.085–$1.093B and adjusted EBITDA to $451–$455M.
Waystar Holding Corp. (NASDAQ:WAY) is a healthcare payments and revenue cycle technology provider. Its cloud-based software is used by hospitals, physician groups, and other care organizations to manage claims processing, billing, prior authorizations, and patient financial interactions.
3. BrightSpring Health Services, Inc. (NASDAQ:BTSG)
Number of Hedge Fund Holders: 51
BrightSpring Health Services, Inc. (NASDAQ:BTSG) is one of the best digital health stocks to buy now.
On October 29, one day after the company’s release of Q3 results, UBS analyst A.J. Rice. reiterated Buy and lifted their 12-month price target to $42 (from $35), citing a classic “beat-and-raise” quarter and management’s confidence, especially around specialty/infusion momentum carrying into 2026.
On October 28, BrightSpring Health Services, Inc. (NASDAQ:BTSG) reported revenue of $3.334 billion (+28.2% YoY), adjusted EBITDA of $160 million (+37.2% YoY), and net income of $37.5 million versus a prior-year loss.
The mix did the heavy lifting: Pharmacy Solutions grew ~31% to $2.97 billion on specialty and infusion strength, while Provider Services rose ~9% to $367 million. Management raised FY25 revenue guidance to $12.4–$12.7 billion and kept adjusted EBITDA at $605–$615 million, pointing to continued specialty volume, limited-distribution drug adds, and execution on the pharmacy platform.
BrightSpring Health Services, Inc. (NASDAQ:BTSG) is a post-acute care company offering home and community-based clinical services, as well as pharmacy solutions, across the United States. It serves medically complex and aging populations through a mix of in-home care, behavioral health support, and medication management.
2. Veeva Systems Inc. (NYSE:VEEV)
Number of Hedge Fund Holders: 61
Veeva Systems Inc. (NYSE:VEEV) is one of the best digital health stocks to buy now.
On November 4, 2025, Veeva announced that its Veeva Basics solution has been adopted by “more than 100 biotechs” to standardize and scale operations across clinical, regulatory, and quality functions. The press release emphasises that Veeva Basics is built on the company’s Vault Platform, enabling emerging biotech firms to deploy best‑practice workflows quickly and transition to a full Vault solution later with no migration required.
Among the newly announced capabilities are two add‑on applications: LIMS Basics for laboratory oversight and batch release operations, and PromoMats Basics for content lifecycle management including promotional content and claims.
Community testimonials in the release highlight how early adopters appreciate pre‑configured templates, rapid implementation and a scalable path forward. One biotech stated that knowing “we have an agile solution that works now, while providing easy access to the Veeva Vault Platform as we grow” gives them peace of mind.
For investors, this announcement underscores Veeva’s role in the emerging‑biotech segment, a market where rapid scale, regulatory compliance and cost‑efficiency are increasingly critical. The uptake by over 100 firms signals momentum in Veeva’s growth strategy within the life‑sciences tools sector.
Veeva Systems Inc. (NYSE:VEEV) is a cloud‑software company focused on life‑sciences organizations. Its offerings include platforms for clinical, regulatory, quality, commercial and data solutions, serving pharmaceutical companies as well as emerging biotechnology firms.
1. GE HealthCare Technologies Inc. (NASDAQ:GEHC)
Number of Hedge Fund Holders: 72
GE HealthCare Technologies Inc. (NASDAQ:GEHC) is one of the best digital health stocks to buy now.
Wall Street’s sentiment on GE HealthCare has remained active in recent weeks, with analysts from several firms adjusting their targets as of late October.
On October 30, 2025, Morgan Stanley raised its price target on GE HealthCare from $74 to $80 while maintaining an Equal Weight rating. In the accompanying note, analyst Patrick Wood cited solid order trends and backlog strength, stating that the firm’s hospital CapEx survey suggested a healthy demand environment. The updated forecast followed adjustments to the firm’s model after GE HealthCare’s third-quarter results.
GE HealthCare reported Q3 results on October 29, 2025. Revenue rose to about $5.1B on strength in Imaging, Advanced Visualization, and Pharmaceutical Diagnostics, with demand led by the U.S. and EMEA. Margins were pressured by tariffs and softer China, but orders grew 6% organically and guidance inched up, signaling confidence in backlog and mix.
GE HealthCare Technologies Inc. (NASDAQ:GEHC) is a global medical technology company providing solutions in imaging, diagnostics, ultrasound, and patient monitoring. It began trading as a standalone entity in January 2023 following its spin-off from General Electric.
While we acknowledge the potential of GEHC to grow, 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 GEHC and that has 100x upside potential, check out our report about this cheapest AI stock.
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