On February 7, Simeon Hyman, Global Investment Strategist at ProShares Advisors, appeared on CNBC to discuss the upcoming jobs report and its expected impact on the market. He believes that the market will hold up, and particularly cites mid-cap stocks as an optimal balance for risk and return. He noted that the economy has shown strength in various sectors, such as the ISM manufacturing index, which recently beat expectations. This broadening of economic growth suggests that the jobs numbers might be decent. Hyman also highlighted the positive earnings growth in the S&P 500, with about three-quarters of companies reporting a 12% year-over-year increase, which is encouraging news.

Recently, the mega-cap tech stocks have shown some weakness despite the overall market being on pace for a winning week. Hyman observed that while this broadening of market performance is positive, it also indicates risk, given that the tech sector still accounts for over 30% of the S&P 500 and remains in the red for the year. His word of the day was mid-caps, which he believes are historically the sweet spot in the market. Mid-caps have outperformed both large and small-cap stocks over the decades. Currently, mid-caps are undervalued, offering investors about $0.50 on the dollar, a situation that hasn’t occurred with small caps despite their underperformance. The key advantage of mid-caps is their earnings growth, which sets them apart from small-caps. When discussing mid-caps versus small caps, Hyman highlighted that mid-caps also have a strong domestic focus, with about 75% of their revenues coming from domestic sources. This is similar to small caps but with a crucial difference: mid-caps generally offer higher quality than small caps, lacking the losses and negative earnings often seen in small-cap companies. This makes mid-caps an attractive option for investors looking for stable growth.

Therefore, we’re here with a list of the 10 best-performing mid-cap stocks to buy according to analysts.

Methodology

We used the Finviz stock screener to compile a list of the best-performing mid-cap stocks that were trading between $2 billion and $10 billion. We then picked the top 10 stocks with year-to-date gains higher than 20% and an average upside potential of over 25%. The stocks are ranked in ascending order of their upside potential. We have also added the hedge fund sentiment for each stock, as of Q4 2024, which was sourced from Insider Monkey’s database.

Note: All data is as of February 24.

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 Performing Mid Cap Stocks to Buy According to Analysts

10. Mirum Pharmaceuticals Inc. (NASDAQ:MIRM)

Year-to-Date Performance as of February 24: 23.24%

Upside Potential as of February 24: 27.01%

Number of Hedge Fund Holders: 38

Mirum Pharmaceuticals Inc. (NASDAQ:MIRM) develops treatments for rare and debilitating diseases, with a focus on liver conditions. Its portfolio includes the approved drug LIVMARLI for Alagille syndrome, as well as other commercialized therapies and promising candidates that target various cholestatic liver diseases.

LIVMARLI generated $59.1 million in global sales during Q3 2024. This is a significant portion of the company’s overall product sales of $90.3 million. The US market contributed $43.5 million to LIVMARLI’s revenue, while international sales reached $15.6 million. A key factor here was the increased adoption of LIVMARLI for Progressive Familial Intrahepatic Cholestasis (PFIC), particularly in the US. The faster-than-anticipated reimbursement process has accelerated patient uptake.

The company is working to expand LIVMARLI’s potential through the Phase 3 EXPAND study, which is evaluating its effectiveness in treating Cholestatic Pruritus. Sites for this study are now open and screening patients. Mirum Pharmaceuticals Inc. (NASDAQ:MIRM) anticipates that patient enrollment will continue for about 18 months, which will broaden LIVMARLI’s application to a larger patient group. LIVMARLI’s international expansion is also progressing well, with approvals secured in major European Union markets for Alagille Syndrome.

ClearBridge Small Cap Growth Strategy invested in Mirum Pharmaceuticals Inc. (NASDAQ:MIRM) due to its stable commercial operations, near-breakeven cash flow, and promising potential for growth through label expansions and new drug candidates. It stated the following in its Q4 2023 investor letter:

“In the fourth quarter we initiated four new investments: Inari Medical, Blackbaud, Mirum Pharmaceuticals, Inc. (NASDAQ:MIRM) and Installed Building Products. Mirum Pharmaceuticals is a commercial stage pharmaceutical company primarily treating rare liver conditions, often in pediatric patients. With multiple approved marketed products across different indications, the company is already operating near cash[1]flow breakeven. Mirum is pursuing label indication expansions across two of its marketed products that could be materially additive to the growth trajectory, along with two promising Phase 2 candidates designed to treat several adult rare liver diseases.”

9. SpringWorks Therapeutics Inc. (NASDAQ:SWTX)

Year-to-Date Performance as of February 24: 55.63%

Upside Potential as of February 24: 28.00%

Number of Hedge Fund Holders: 40

SpringWorks Therapeutics Inc. (NASDAQ:SWTX) is a commercial-stage biopharmaceutical company that develops therapies for rare diseases and cancer. Its lead product, OGSIVEO, targets desmoid tumors and it has a pipeline of MEK and BRAF inhibitors that are aimed at various solid tumors.

In Q3 2024, OGSIVEO generated $49.3 million in net product revenue, which was a 23% sequential increase. This growth was fueled by the demand from new and existing patients who experienced clinical benefits. The OGSIVEO launch has been highly successful, positioning it as the standard systemic therapy for desmoid tumors. Market research indicates significant growth potential, as only a fraction of eligible patients have been reached by now. The introduction of new tablet strengths and blister packaging has improved patient convenience and adherence.

In September, over 800 patients filled OGSIVEO prescriptions, and 65% have transitioned to blister packs, which improves refill predictability. The estimated patient population has increased from 5,500-7,000 to ~10,000, based on new diagnosis code data. OGSIVEO is prescribed at 420 treatment centers, with 57% of prescribers in community settings. Physician feedback highlights OGSIVEO’s efficacy and tolerability, with 90% intending to use it as frontline treatment. 60% of physicians expect to increase their OGSIVEO usage. Global expansion is also underway, with EU regulatory reviews and planned launches in Europe and Japan. Long-term data shows continued tumor reduction and symptom relief with OGSIVEO. SpringWorks Therapeutics Inc. (NASDAQ:SWTX) is confident in its continued growth.

8. Oklo Inc. (NYSE:OKLO)

Year-to-Date Performance as of February 24: 61.14%

Upside Potential as of February 24: 28.08%

Number of Hedge Fund Holders: 27

Oklo Inc. (NYSE:OKLO) designs and develops fission power plants to provide reliable and commercial-scale energy to customers in the US. It also provides used nuclear fuel recycling services. It’s targeting the AI data center energy market.

The company is capitalizing on the rising demand for reliable, low-carbon power. Deals exceeding $100/MWh validate this need. The company’s build-own-operate model appeals to data centers. It has secured LOIs for 750MW from two data centers, which total 2.1GW in signed agreements. This includes a $25 million prepayment from Equinix. Equinix is a digital infrastructure company that provides data center and interconnection services. Regulatory progress includes aiming for a 24-month NRC license for its Idaho project. The Idaho project refers to the planned deployment of the company’s first advanced nuclear power plant at the Idaho National Laboratory. This is a step towards commercializing its advanced nuclear technology.

The $25 million stock acquisition of Atomic Alchemy enhances the company’s radioisotope production. Atomic Alchemy is a company that develops proprietary reactor and isotope production technologies to produce radioisotopes. Radioisotopes are radioactive elements with applications in advanced manufacturing, including components crucial for AI hardware. Oklo Inc. (NYSE:OKLO) is acquiring Atomic Alchemy to integrate radioisotope production into its fuel recycling process.

On January 24, Wedbush analyst Dan Ives increased the price target on Oklo Inc. (NYSE:OKLO) from $26 to $45. Ives’ confidence stems from projects like Stargate, where nuclear energy is expected to play a vital role. This positions the company as a major player in supporting the growing power demands of AI data centers, particularly under the anticipated policies of the Trump Administration.

7. Guardant Health Inc. (NASDAQ:GH)

Year-to-Date Performance as of February 24: 39.74%

Upside Potential as of February 24: 31.15%

Number of Hedge Fund Holders: 40

Guardant Health Inc. (NASDAQ:GH) is a precision oncology company that specializes in liquid biopsies and advanced analytics. It offers tests and platforms to detect, monitor, and inform treatment decisions for cancer patients. It uses AI and extensive data to drive advancements in personalized cancer care.

The company’s therapy selection, driven by Guardant360, is a key revenue generator. Guardant360 is a liquid biopsy test that analyzes circulating tumor DNA in the bloodstream to identify genomic alterations in advanced solid tumors. This aids in personalized cancer treatment decisions. In Q4 2024, clinical revenue grew 34% year-over-year. Guardant360 volumes saw double-digit growth in 2024 and contributed to a 24% increase in Q4 clinical test volumes. Guardant360’s average selling price reached $3,000 in Q4 2024, ahead of the 2028 target, due to Medicare rate increases and improved commercial collections. The upgraded Guardant360 Liquid enhances gene coverage and sensitivity on the Smart Liquid Biopsy platform, which drives increased test frequency.

In mid-January, Guardant Health Inc. (NASDAQ:GH) entered a collaboration with ConcertAI, where it’s using AI to integrate patient electronic medical record (EMR) data with tumor profiling to create a real-world data solution for biopharma partners. This is to enhance disease biology interpretation, identify tumor evolution mechanisms, and improve cancer treatment development through advanced data and AI analytics.

6. AST SpaceMobile Inc. (NASDAQ:ASTS)

Year-to-Date Performance as of February 24: 29.27%

Upside Potential as of February 24: 31.77%

Number of Hedge Fund Holders: 22

AST SpaceMobile Inc. (NASDAQ:ASTS) is developing a satellite network that will enable standard smartphones to connect directly to space-based broadband. It aims to eliminate cellular coverage gaps, extend connectivity to underserved regions, and provide communication beyond the reach of traditional land-based networks.

Cantor Fitzgerald began covering the company on February 6, with an Overweight rating and a $30 price target. This sentiment came due to its strong telecom and tech partnerships, defense potential, and supply chain advantages. They highlighted the company’s long-term opportunities in AI integration and government contracts, particularly with the Space Development Agency.

The company’s primary focus is building its satellite-based cellular broadband network, centered on its BlueBird satellites. It successfully launched five Block 1 satellites, aiming for near 100% US coverage using low-band spectrum. These satellites will integrate with partners like AT&T and Verizon for beta services. The company is developing Block 2 satellites, powered by its AST5000 ASIC chip, which will increase processing bandwidth tenfold. It secured launch agreements with Blue Origin and SpaceX for up to 60 satellites in 2025-2026.

This transition from R&D to commercial operations involves scaling manufacturing and launch efforts. AST SpaceMobile Inc. (NASDAQ:ASTS) ended Q3 2024 with $518.9 million in cash, which includes proceeds from warrant exercises and ATM facilities. The goal is to provide cellular broadband to mobile network operators globally, reaching 2.8 billion subscribers.

5. Dana Inc. (NYSE:DAN)

Year-to-Date Performance as of February 24: 35.90%

Upside Potential as of February 24: 33.08%

Number of Hedge Fund Holders: 27

Dana Inc. (NYSE:DAN) provides power conveyance and energy-management solutions for vehicles and machinery. Operating across diverse segments, it offers comprehensive drive and motion systems, electrodynamic technologies, and digital solutions. It serves manufacturers in the light, commercial, and off-highway vehicle markets, as well as the industrial sector.

The company’s ‘New Dana’ segment represents over 80% of its backlog. New Dana focuses on light and commercial vehicle systems, after the divestiture of its Off-Highway segment. The Off-Highway segment produces drivetrain and motion systems for heavy-duty, non-road vehicles and equipment. The company is aggressively pursuing margin improvements within the New Dana segment, targeting 8.1% to 8.6% in 2025 and aiming for double-digit margins by 2026. This focus is driven by a $300 million cost reduction program, with significant portions already realized, and ongoing efforts to enhance operational efficiency. The 2025 guidance anticipates overall sales of ~$9.75 billion.

Looking ahead, Dana Inc. (NYSE:DAN) is implementing strategic initiatives to further strengthen New Dana. This includes consolidating power technologies initiatives for $15 to $20 million in run-rate savings and adopting a measured approach to EV programs to reduce capital expenditure. The company is also navigating market fluctuations, anticipating a flattish light vehicle market and a stabilizing commercial vehicle market towards the end of 2025.

4. BridgeBio Pharma Inc. (NASDAQ:BBIO)

Year-to-Date Performance as of February 24: 29.90%

Upside Potential as of February 24: 37.88%

Number of Hedge Fund Holders: 48

BridgeBio Pharma Inc. (NASDAQ:BBIO) is a commercial-stage biopharmaceutical company that develops transformative medicines for genetic diseases and cancers. It has a diverse pipeline of clinical-stage programs, which include AG10 for TTR amyloidosis, low-dose infigratinib for achondroplasia, and gene therapies like BBP-631 for congenital adrenal hyperplasia.

On February 22, Scotiabank increased its price target for BridgeBio Pharma Inc. (NASDAQ:BBIO) to $52 from $49, reaffirming an Outperform rating. The analysts were impressed with how well the company’s new drug, Attruby, is selling for a heart condition called transthyretin amyloid cardiomyopath. The drug’s rapid adoption signals a strong preference for it as a first-line treatment.

Since its FDA approval in late 2024, Attruby has seen rapid uptake, with 1,028 prescriptions written by 516 providers by mid-February 2025. This strong initial demand translated to $2.9 million in net product revenue in Q4, contributing to a total yearly revenue of $221.9 million. The drug’s European approval as BEYONTTRA further supports its potential. Attruby’s success comes from proven clinical efficacy. As the first near-complete TTR stabilizer, it demonstrated reductions in cardiovascular death and hospitalizations in clinical trials.

BridgeBio Pharma Inc. (NASDAQ:BBIO) anticipates further growth through additional regulatory approvals, notably in Japan, which will generate further milestone payments and revenue. The company is actively investing in commercialization. This is reflected in increased selling, general, and administrative expenses, to ensure that Attruby reaches a wider patient base.

3. Akero Therapeutics Inc. (NASDAQ:AKRO)

Year-to-Date Performance as of February 24: 80.01%

Upside Potential as of February 24: 49.55%

Number of Hedge Fund Holders: 41

Akero Therapeutics Inc. (NASDAQ:AKRO) is a clinical-stage biopharmaceutical company that develops treatments for serious metabolic diseases, primarily MASH (Metabolic dysfunction-associated steatohepatitis). Its lead candidate efruxifermin (EFX) is currently in Phase 3 trials and aims to address the underlying metabolic dysfunctions associated with these conditions.

The company is heavily reliant on efruxifermin (EFX). The Phase 2b SYMMETRY study highlighted EFX’s potential and showed a 39% cirrhosis reversal rate in patients treated with 50mg EFX at week 96, as compared to the 15% in the placebo group. This improvement, coupled with a favorable safety profile like no deaths and only mild side effects, has fueled investor confidence. The absence of approved therapies for MASH positions EFX as a potential first-in-class treatment.

EFX acts like the body’s FGF21 hormone, which regulates metabolism. By mimicking it, EFX aims to correct the metabolic problems that cause liver damage in MASH. The positive Phase 2b results and ongoing Phase 3 trials indicate strong momentum, making EFX the key driver of Akero Therapeutics Inc.’s (NASDAQ:AKRO) future growth.

2. Zai Lab Ltd. (NASDAQ:ZLAB)

Year-to-Date Performance as of February 24: 25.75%

Upside Potential as of February 24: 52.30%

Number of Hedge Fund Holders: 26

Zai Lab Ltd. (NASDAQ:ZLAB) develops and commercializes innovative therapies across oncology, autoimmune disorders, infectious diseases, and neuroscience. With a portfolio of approved products and a pipeline of novel candidates, it uses strategic collaborations to bring transformative treatments to patients in China and globally.

Its primary growth engine is VYVGART, which is a treatment for generalized myasthenia gravis (gMG) in China. The drug’s commercial success is evident in its Q3 2024 net product revenue of $27.3 million, which is an increase from $4.9 million year-over-year. This performance positions VYVGART to exceed $80 million in sales for the full year 2024. To date, ~10,000 patients have been treated, and nearly 2,000 healthcare professionals have prescribed it, which highlights its rapid adoption. The company has secured listings at all targeted top-priority hospitals, covering ~65% of the gMG market potential.

The company reported a 47% year-over-year increase in total net product revenue for the third quarter, reaching $101.8 million, driven by VYVGART. This revenue growth, coupled with ongoing efficiency initiatives, has led to a 40% reduction in net loss compared to the previous year. With continued growth projections, Zai Lab Ltd. (NASDAQ:ZLAB) is on track to achieve profitability by the end of 2025.

1. Nebius Group (NASDAQ:NBIS)

Year-to-Date Performance as of February 24: 24.15%

Upside Potential as of February 24: 58.96%

Number of Hedge Fund Holders: 66

Nebius Group (NASDAQ:NBIS) specializes in building comprehensive infrastructure for the global AI industry. This encompasses AI-centric cloud platforms, data services, educational programs, and autonomous driving technology. It supports the development and deployment of advanced AI applications.

It’s driving its growth through the AI infrastructure business, which is centered on providing GPU-based compute and cloud services. It’s expanding its data center footprint, with new deployments in Iceland and Kansas City, and plans for a custom-designed US data center. This expansion supports the increasing demand for AI computing resources. From this, the company projects a March 2025 analyzed run rate revenue of at least $220 million, with ambitions to reach $750 million to $1 billion by December 2025.

This growth is fueled by increased client acquisition and strong contracts already in place. Nebius Group (NASDAQ:NBIS) successfully raised $700 million in December 2024, attracting major investors like NVIDIA and Accel, and ended 2024 with $2.4 billion in cash. The company’s focus on its AI cloud and Inference-as-a-Service platforms therefore positions it as a key player in the rapidly growing AI infrastructure market.

While we acknowledge the growth potential of Nebius Group (NASDAQ:NBIS), our conviction lies in the belief that AI stocks hold great promise for delivering high returns and doing so within a shorter time frame. If you are looking for an AI stock that is more promising than NBIS but that trades at less than 5 times its earnings, check out our report about the cheapest AI stock.

READ NEXT: 20 Best AI Stocks To Buy Now and Complete List of 59 AI Companies Under $2 Billion in Market Cap.

Disclosure: None. Insider Monkey focuses on uncovering the best investment ideas of hedge funds and insiders. Please subscribe to our free daily e-newsletter to get the latest investment ideas from hedge funds’ investor letters by entering your email address below.