Julian Emmanuel, Evercore ISI senior managing director, said in a recent program on CNBC that the AI-driven bull market will continue, but he expects a pullback in the short term. The analyst believes any such weakness would be a buying opportunity.
“Great bull markets and this is a structural AI technology-driven bull market,” Emmanuel said. “Great bull markets find ways to try in to get investors to get off the theme to do some selling. And our our feeling here is you don’t do that because basically when you think about it, what really drives stock prices higher in the long term is earnings and we’re very optimistic uh on earnings into 2026.”
The analyst said companies that are actually using AI, have strong earnings and “reasonable” valuations offer opportunities for investors if a market downturn hits.
“There are companies who in their conference call transcripts have been very public about how they’re using and deploying AI. And importantly, and we like these types of screens, not only are their valuations reasonable based on their last 5 years history, but they have upward earnings revisions in in a tape like this where there is some uncertainty. Those are the kinds of safeguards that to us really are an extra edge.”
READ ALSO: 7 Best Stocks to Buy For Long-Term and 8 Cheap Jim Cramer Stocks to Invest In.
For this article, we picked 10 stocks analysts were recently talking about. For each stock, we have mentioned the number of hedge fund investors. 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).
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10. Dell Technologies Inc. (NYSE:DELL)
Number of Hedge Fund Investors: 54
Bryn Talkington, managing partner at Requisite Capital Management, said in a CNBC program on August 20 that she trimmed her stake in Dell Technologies Inc. (NYSE:DELL), but would pile into the stock if it retreats to low $100s.
“Dell’s growth engine is their infrastructure services group and inside of that, that’s where they are like the key tech stack within the AI build,” Talkington said. “I think they’re taking really strong market share from SMCI, but because it’s just part of the company, they still have a big consumer company with the computers. I think that as the stock got into the high 130s, I just felt it was going to be a top, and so I think a temporary top. But once again, they’re buying back shares. I’m a huge fan of Michael Dell. I’ll definitely look to get back in if I get an opportunity into the low 100s.”
9. Palantir Technologies Inc. (NASDAQ:PLTR)
Number of Hedge Fund Investors:78
Derek Yan, KraneShares Senior Investment Strategist, said in a recent program on CNBC that Palantir Technologies Inc. (NASDAQ:PLTR) has the potential to become the “operating system for enterprises” in the world of AI. He also explained the key reasons investors usually worry about Palantir and mentioned why he’s bullish on the stock:
“Palantir is offering the similar opportunity here for investors to really disrupt the enterprise world along with many other agentic AI solutions. So the recent like selling I would think that’s largely driven by macro factors and there’s some profit taking. We own Palantir over a year ago and now it’s over $150. So many other investors they’re concerned about valuation and worry about like potential risk off triggered by the fat policies that’s coming. Well I believe this is a singular grow structural growth opportunity right. So AI agent option is accelerating. The cost per token will keep declining. As a result, the return on investment for enterprises to deploy AI and use Palantir service to automate their workflow will become increasingly attractive.”
Palantir has proved its skeptics wrong and so far defied conventional valuation approaches, enjoying an insanely high P/E ratio. The company is consistently growing. In the recently reported quarter, its revenue rose 48% year over year. The company’s full-year outlook points to sales growth of about 45%. While Palantir bears have highlighted its high dependence on just a few customers for most of its revenue, all signs indicate that the company’s growth won’t stop anytime soon. Why? Because Palantir’s Artificial Intelligence Platform (AIP) is becoming indispensable for companies to deploy and operate AI systems and infrastructure. The AI software boom is just getting started, paving the way for more growth for companies like Palantir. Hyperscaler capex is expected to reach $1.15T from 2025 through 2027, more than double the $477B spent from 2022 through 2024.
Carillon Eagle Mid Cap Growth Fund stated the following regarding Palantir Technologies Inc. (NASDAQ:PLTR) in its second quarter 2025 investor letter:
“Palantir Technologies Inc. (NASDAQ:PLTR), a leader in artificial intelligence (AI) software and services to governmental organizations, reported robust results and provided a strong outlook, as both the U.S. military and NATO purchased large contracts. Palantir also has had success penetrating non-military agencies of the U.S. government, as well as the commercial (corporate) side of the market with AI use cases that deliver quantifiable added value through its bootcamp product demonstrations.”
8. Intel Corp (NASDAQ:INTC)
Number of Hedge Fund Investors:82
Steve Levy, Wired editor-at-large, said in an interview on CNBC a couple of weeks ago that he believes the US government’s stake in Intel would make CEOs of major companies believe that the government could target their companies next. He was commenting on the US government’s decision to buy a 10% stake in Intel.
“They have gone all in some not very happily with Trump. But Trump isn’t satisfied with the deal he makes in Mara Lago or the White House on a given day. He’s going to come back and ask for more,” Levy said. “We’ve already seen that he’s very eager to run the businesses, you know, the the biggest businesses of America. He thinks he knows more than they do. So you look at the Intel bill and he’s bragging we got it for nothing. And you could argue that’s true because as you said up top this was money that Congress already granted the president the previous president signed off. They were going to get anyway. They have a contract to do this classified work. They’re going to do that work anyway. But now essentially for free I guess you know I wonder if the shareholders might have something to say about that. But what happens now when the government’s the biggest shareholder in Intel? AMD can’t be happy about that. So maybe you know Trump will say well you give me 10% too.”
7. Salesforce Inc (NYSE:CRM)
Number of Hedge Fund Investors: 121
Bryn Talkington, managing partner at Requisite Capital Management, explained in a recent program on CNBC why she bought Salesforce shares.
“Salesforce is Uber in the 60s. And Marc Benioff has been very clear. Let’s focus on free cash flow. Let’s focus on margins. Let’s focus on growth and financial stability. I think what they’re doing, I think the market is completely missing this nonsense that some other nebulous AI is going to come in and take over what Salesforce is doing — just is absurd. Salesforce is using AI. Their acquisition of Informatica I think is going to be great; it’s going to be creative the year after next. I just think this is an unloved stock that’s getting caught up in the hedge fund shorts of shorting these software companies, and this is one to me. It’s been up the past few days and it can easily trade up 15 to 20% in after earnings because I just think the market is missing this name and it’s an Uber in the 60s,” Talkington said.
Salesforce shares are down 24% so far this year. The company recently reported a decent quarter, but the stock fell amid weak guidance. For the third quarter, the company expects revenue between $10.24 billion and $10.29 billion, below the Wall Street estimates at the midpoint.
Oakmark Fund stated the following regarding Salesforce, Inc. (NYSE:CRM) in its second quarter 2025 investor letter:
“Salesforce, Inc. (NYSE:CRM) is a leading technology company that offers a collection of software products aimed at providing businesses with a full front office productivity suite. We believe Salesforce is a wonderful business going through a transformation into a profitable, shareholder-focused enterprise. Since management announced their renewed focus on operating discipline a couple years ago, Salesforce’s margins have increased substantially. In our view, there is further room to improve as the company leverages its unique position to help businesses deploy AI and continues to restructure its sales organization. Since exiting our position in Salesforce in December, the stock price has declined by over 30% despite continuing to report fundamental results that are in line with our expectations. We were pleased to buy the stock, but we first established our position using a put writing strategy to lower our entry price. We believed the puts were overvalued as they implied that Salesforce was among the most volatile large companies, which was completely at odds with our assessment of its business value.”
6. Apple Inc (NASDAQ:AAPL)
Number of Hedge Fund Investors: 156
Joe Terranova, senior managing director at Virtus Investment Partners, said in a program on CNBC on August 20 that he trimmed his stake in Apple. Here is how the analyst explained the move:
“It’s not a portfolio type position. So, I’ve been riding the momentum higher. I’ve been buying high, continuing to buy it higher. I started at 206. I bought it all the way up to 232. I spoke each time on air when I bought it and I said, I’m going to manage the risk when I think I see the exhaustion. I think I’ve seen the exhaustion. It got to about 235, 236. It looks like that’s a temporary ceiling. I think it will go through there eventually and go back towards 240–245. But in the near term, the smart thing to do was ring the register, take a little profit, reduce the size. I cut the position in half. I have no problem with that.”
Baron Opportunity Fund stated the following regarding Apple Inc. (NASDAQ:AAPL) in its second quarter 2025 investor letter:
“Apple Inc. (NASDAQ:AAPL) is a leading manufacturer of consumer electronics, computer software, and online services. Shares declined amid mounting headwinds, including new U.S. tariffs on Apple’s China centric supply chain, which are pressuring gross margins, and increased regulatory scrutiny of the App Store model in both the U.S. and Europe. These developments have introduced greater uncertainty around the growth and profitability of Apple’s high margin services business. While we continue to admire Apple’s brand, ecosystem, and long-term innovation capabilities, the ongoing regulatory overhang and heightened risk to margins and growth prospects led us to exit the position and reallocate capital to holdings with more compelling risk/return profiles.”
5. Broadcom Inc (NASDAQ:AVGO)
Number of Hedge Fund Investors:156
Dan Nathan, the principal of RiskReversal Advisors and CNBC Fast Money trader, was recently asked during a program whether there are other names out there that investors can consider in addition to Nvidia. Here is what Nathan said:
“This is kind of consensus here but it would be Broadcom and Marvell. So the idea that you know Nvidia has this customer concentration. You know who they are. They’re all the hyperscalers. They’re Open AI and all of them are working let’s say with Broadcom or Marvell to create their own custom chips, right?”
For the fiscal fourth quarter, AVGO expects $6.2 billion in AI revenue, up 66% from a year earlier. The company said it secured $10 billion in AI infrastructure orders from a new customer. Many analysts believe this customer is OpenAI. Some media reports said the two companies co-designed a chip that will be launched next year.
What’s Broadcom’s moat? It makes ASIC, chips designed for specific applications and tasks. As major companies look for custom chips to break Nvidia monopoly and lower costs, Broadcom is positioned well to thrive. Many top AI spenders are teaming up with Broadcom to develop these chips, which are expected to be high-margin, high-volume products, potentially driving substantial growth in both revenue and profits.
Janus Henderson Forty Fund stated the following regarding Broadcom Inc. (NASDAQ:AVGO) in its second quarter 2025 investor letter:
“Broadcom Inc. (NASDAQ:AVGO), another top contributor in AI infrastructure, has benefited from hyperscalers’ interest in a second source behind NVIDIA’s merchant silicon. The semiconductor company leads in custom silicon development, offering lower cost and better efficiency for specific workloads that don’t require maximum performance GPUs. The market also continues to evolve as custom silicon has gained share relative to merchant chips. Broadcom’s leadership position makes it a clear beneficiary of this shift.”
4. Alphabet Inc (NASDAQ:GOOG)
Number of Hedge Fund Investors:178
Mark Mahaney, Evercore ISI head of internet research, said in a CNBC program on August 20 that Google is one of the top beneficiaries of the GenAI wave. The analyst also praised Google’s YouTube and Waymo businesses.
The play here really is Gen AI and whether Google is roadkill or the whatever the opposite of roadkill is. And I think they’re the opposite of roadkill,” Mahaney said. “I think that’s been the issue on the stock and I think they’re going to be able to prove that in fact they’re one of the best beneficiaries, largest derivatives of of the growth in in Genai. I think you’re seeing that in their search results. I think you’re seeing that that have been consistently double digit despite all of the focus on the rise of chat GPT. I think you’ve seen that in YouTube and you’re certainly seeing it and maybe the best physical manifestation of AI out there. It’s probably not the smartphone, it’s the car with with Waymo. So look, I I we’ve had a big rally in Google stock. It’s up 25%. Over the last last couple of months, but valuation is still, I think, very attractive at 18 19 times earnings.”
Alphabet Inc. (NASDAQ:GOOG) bulls believe concerns around AI-related threats to Google search are overstated. Google has an edge over competitors because it’s easier for the billions of users of its search engine to switch to Gemini instead of opting for a completely new model. As of April, Google had over 1.5 billion monthly users interacting with its AI-powered Search overviews.
Google’s competitor OpenAI failed to impress the market with its GPT-5 model, while Gemini is gaining traction with new features. Analysts believe the company is strongly positioned to start placing ads in AI search results, which means its core ads business will not be impacted despite the decline in traditional search.
Pershing Square Holdings stated the following regarding Alphabet Inc. (NASDAQ:GOOG) in its second quarter 2025 investor letter:
“Alphabet Inc. (NASDAQ:GOOG), the parent company of Google, is successfully executing on its vast AI potential. The company’s key advantages – stemming from industry-leading models, a full-stack approach to technical infrastructure (including proprietary chips), access to high-quality data, rapidly improving product launch velocity and a robust distribution ecosystem of seven different apps with over two billion users each – are beginning to meaningfully widen Google’s moat and competitive differentiation in AI.
In its core Search product, the company’s AI leadership is most evident in its broad roll-out of AI-powered summary responses, called “AI Overviews”. AI Overviews are now being served to more than two billion users across 200 countries, making it the most widely used consumer AI product. AI Overviews are resulting in users asking more detailed questions, clicking through at higher rates and searching with greater frequency. On the back of AI Overviews’ success, the company has also introduced “AI Mode”, which more closely resembles a chat-like user experience, directly onto the Search page…” (Click here to read the full text)
3. Nvidia Corp (NASDAQ:NVDA)
Number of Hedge Fund Investors:235
Guy Adami from CNBC Fast Money predicted in a program that NVIDIA Corporation (NASDAQ:NVDA) earnings will be “staggering,” but the “magnitude” of growth is getting smaller.
“I think it’s extraordinarily important. Go back to April and look what happened to the broader market. Look what happened. Nvidia went from, I think, 153 and change its all-time high. Chris probably has it right in front of him. Traded down to $90 on the April low. I mean, percentage-wise, that is a significant move. And obviously, the broader market, not necessarily on the back of that, but it pretty much acted in kind. So, I think it is important. I think you’re looking at a revenue quarter that’s probably north of 48 billion. I think the streets at 46. I think the numbers will be staggering, the size of the numbers. I think the concern should be the magnitude of the growth in terms of revenue growth for the forecast because the numbers are getting bigger, the percentages are getting smaller.”
Nvidia’s Hopper Infrastructure and now Blackwell form the core of AI infrastructure for LLM training and inference. But Nvidia’s growth is slowing compared to previous quarters amid competition and capex spending limitations from major companies. In the recently reported quarter, Nvidia’s annual revenue growth came in at 56%, compared with nearly 100% YoY growth in the past.
With its strong position in the data center market and rising demand, Nvidia is likely to keep growing, though not at the same pace it has in the past. Increasing competition from major companies like Broadcom is also expected to impact Nvidia’s margins in the long term.
Loomis Sayles Growth Fund stated the following regarding NVIDIA Corporation (NASDAQ:NVDA) in its second quarter 2025 investor letter:
“NVIDIA Corporation (NASDAQ:NVDA) is the world leader in artificial intelligence (AI) computing, which enables computers to mimic human-like intelligence for problem solving and decision making capabilities. Founded in 1993 to develop faster and more-realistic graphics for PC-based video games, Nvidia created the first graphics processing unit (GPU), a dedicated semiconductor that employs a proprietary parallel processing architecture to perform superior graphics rendering outside of a computer’s standard central processing unit (CPU). The parallel processing capability of Nvidia’s GPUs, which contrasts with the linear processing requirement of CPUs, can accelerate computing functions performed by standard CPUs by greater than ten times. As a result, Nvidia extended its visual computing expertise beyond its legacy gaming market into innovative new and larger markets, including data centers, autos, and professional visualization. The parallel processing capability facilitates pattern recognition and machine learning functions that have enabled Nvidia to be at the forefront of growth in artificial intelligence applications. As a result, the data center business, which first surpassed the gaming business to become Nvidia’s largest revenue and profit generator in its 2023 fiscal year, grew to represent over 88% of revenue in the company’s most recent fiscal year. The company is also focused on building out its GPU-computing-based ecosystem and is helping to enable breakthroughs in autonomous driving, and virtual reality.
A fund holding since the first quarter of 2019, Nvidia reported very strong quarterly financial results that reflected the company’s dominance in capturing spending on AI computing within data centers. For the quarter, total revenue of $44.1 billion grew 69% year over year and 12% versus the prior quarter, despite new U.S. Government restrictions on the sale of its H20 chips to China that resulted in $2.5 billion of foregone revenues in the period. Nvidia’s H20 chips were specifically designed to comply with prior U.S. export restrictions, and the company anticipates a further $8 billion of foregone sales in the current quarter due to the restrictions. Despite the revenue headwind, the company expects revenue of approximately $45 billion in the current quarter, which would represent 50% growth over the prior-year quarter. The results were also notable due to recent concerns that spending might slow given potentially cheaper options to develop AI functionality. These concerns were catalyzed by the January 2025 launch of DeepSeek-V3, a chatbot that appears to rival OpenAI’s ChatGPT from the standpoint of industry performance metrics, but which was claimed to have been created for a fraction of the cost using Nvidia’s now-restricted H800 chips. We did not believe that the DeepSeek development materially changed the level of investment needed to develop the next generation of frontier models as companies strive for AGI (artificial general intelligence) and beyond. We believe this view is supported by the unchanged plans for AI investment by the industry’s leading spenders. Following the news, some of the world’s largest investors in AI technology, including Meta, Microsoft, and Alphabet, reaffirmed and expanded on their intention to spend tens of billions of dollars in 2025. We believe this supports our thesis that Nvidia’s accelerated computing technology remains crucial to achieving AGI and other AI advances. Further, Nvidia noted that the success of DeepSeek, which employs reasoning AI, has itself been a driver of strong demand. With reasoning AI, as opposed to providing a “one-shot” answer based on statistical probabilities and existing patterns, the model spends more time refining the answer by running it through the model multiple times before outputting an answer that is more accurate and nuanced. As a result, reasoning AI is more compute intensive and can require 100 times more computing power per task than one-shot inferencing. With continued evidence that greater capabilities can be achieved with greater computing power and expanding use cases such as agentic AI, we believe both near-term and long-term demand will remain strong…” (Click here to read the full text)
2. Meta Platforms (NASDAQ:META)
Number of Hedge Fund Investors: 260
Kevin Simpson, Capital Wealth Planning founder and CIO, said in a CNBC program on August 22 that he bought Meta Platforms shares. Here is how he explained the reasons behind the move:
“We were not expecting the big spend for Google and also as an Alphabet shareholder. That’s terrific. But overall, you’ve seen a stock that’s really rolled over recently. We still look at Meta. It was our number one pick going into the year. I think it continues to be. We look at this pullback and took advantage of it yesterday. Bought another 1% and yes, we sit here today looking lucky and smart, but when you see weakness, those are the times to deploy capital.”
First Eagle Global Fund stated the following regarding Meta Platforms, Inc. (NASDAQ:META) in its second quarter 2025 investor letter:
“Meta Platforms, Inc. (NASDAQ:META)—the parent company of Facebook, Instagram and WhatsApp, among other social-media platforms—reported strong revenue and earnings growth during the quarter, driven by increases in both ad impressions and price per ad. The company continued to aggressively invest and hire in AI, even as it develops its core advertising businesses. We believe these results demonstrate Meta’s ability to focus on both profitability and efficiency in conjunction with ongoing investments in the core ad business, the metaverse and other AI applications.”
1. Amazon.com Inc (NASDAQ:AMZN)
Number of Hedge Fund Investors: 335
Ken Gawrelski, Wells Fargo senior internet analyst, said in a recent program on CNBC that the consumer has been extremely resilient, and a possible rate cut from the Fed could further benefit consumer companies. In this context, the analyst believes Amazon.com, Inc. (NASDAQ:AMZN) is among the “tactical” winners.
“Another name that we’ve been maybe less positive but more certainly is a tactical winner on this is Amazon. Right, the big retail business, their big retail business. They announced recently an entry into a more aggressive entry with Prime same day delivery into grocery. So that’s a name we also see in the back half into 26 that would benefit from this trend.”
Pershing Square Holdings stated the following regarding Amazon.com, Inc. (NASDAQ:AMZN) in its second quarter 2025 investor letter:
“Earlier this year, we initiated a position in Amazon.com, Inc. (NASDAQ:AMZN), a company we have long studied and admired. Amazon operates two of the world’s great, category-defining franchises: its Amazon Web Services (AWS) cloud business and its e-commerce retail operations. Both AWS and the company’s retail operations are supported by decades-long secular growth trends, occupy dominant positions in their respective markets, and have significant long-term opportunities for margin expansion. Moreover, despite operating in different industries, both businesses share the core tenets of Amazon’s ethos: a relentless focus on the customer, leveraging scale to be the lowest-cost provider, and continually reinvesting to improve their value proposition.
AWS, which accounts for approximately 60% of Amazon’s total profits, is the leader in the highly concentrated cloud hyperscaler market with over 40% market share. As the first mover in the space, AWS is exceptionally well-positioned to capitalize on the multi-decade shift of IT workloads from on-premise to cloud solutions. Currently, only about 20% of IT workloads are estimated to be hosted in the cloud, a percentage that is expected to steadily increase and eventually invert over time. Similarly, Amazon’s retail business is powered by strong secular growth in e-commerce adoption. In the U.S., for example, e-commerce sales penetration has doubled in the past decade yet still accounts for less than 20% of total retail sales. Within this rapidly expanding market, Amazon holds a leadership position by offering consumers the widest selection, the lowest prices, and the fastest delivery, all enabled by a one-of-a-kind logistics network that fulfills over $700 billion in gross merchandise value annually…” (Click here to read the full text)
While we acknowledge the potential of AMZN 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 AMZN and that has 100x upside potential, check out our report about this cheapest AI stock.
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