The US stock market is proving to be resilient despite the AI bubble warnings and labor market worries. Amid the Fed’s rate-cut cycle and the possibility of trade tensions between the US and China easing soon, market bulls are increasing their year-end targets for the S&P 500. Jim Lebenthal, a partner at Cerity Partners, said in a recent program on CNBC that we are currently in a “trend is your friend” market and investors should not go against the bullish tide.
“You look at this and you do say isn’t this already priced into the market but that sort of analysis just doesn’t matter,” Lebenthal said. “This is a trend is your friend sort of market and you see it in how much cash comes into the market on the slightest dip, whether it’s retail and money market funds, whether it’s professional money managers trying to catch up to their benchmark, it just is what it is. If you do get a China US trade deal we go higher on it, that’s just where we are, that we’ll worry about this in January, but right now the trend is your friend.”
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10. Joby Aviation Inc (NYSE:JOBY)
Number of Hedge Fund Investors: 31
Josh Brown, CEO of Ritholtz Wealth Management, in a recent program on CNBC commented on JOBY’s stock decline after the electric air-taxi maker priced a $514 million discounted share sale. Brown explained why he remains bullish on the stock and believes the capital raise was “great news.”
“The stock is actually higher than where they placed this offering at $16.85. This reminds me of Tesla. The bears used to say, “Oh, Elon’s running out of money. There’s going to be a secondary. They’re going to dilute you. They’re going to dilute you.” And then they would do a massive secondary and the stock would go up 20%. And the bears would be like, “Wait, I don’t understand what just happened.” What you have to understand with these companies that are pre-revenue in the developmental stage of their business is that the fact that they can do a secondary is the bullish part. Look how fast that stock was taken down. It’s $500 million worth of stock at a 9% discount to last night’s close. They snapped it up like it was an amuse-bouche. And that’s the bullish aspect. Look at the demand that’s there to be invested in the low altitude economy. So, I actually think it’s great news. This is not selling insiders. This is money that’s going to be used to build out the vertiports now that they’ve acquired the Blade business and to continue to build the S4 eVTOL, which is going to be what this business is all about. You need a lot of money in order to do that, and that’s where this capital raise is coming from.”
9. Dell Technologies Inc (NYSE:DELL)
Number of Hedge Fund Investors: 54
Ben Reitzes, Melius Research head of technology research, said in a recent program on CNBC that Dell is a cheap stock.
“Dell Technologies Inc (NYSE:DELL) has a role as enterprises pick up AI and need to make use of their data on-prem. Plus, Dell’s a cheap stock, and Michael’s been on this. He’s got a cheap stock, he’s buying back stock. I mean, we only went to a 15 multiple. These guys used to get a 30 multiple back in the day. There’s a shot that a lot of these hardware companies get over a market multiple or better, and the SaaS companies become the old hardware and go to single-digit multiples. I’m not kidding. I mean, that’s how much disruption there is.”
8. IBM Common Stock (NYSE:IBM)
Number of Hedge Fund Investors: 63
Ben Reitzes, Melius Research head of technology research, earlier in October talked about the impact of AI on software. The analyst pointed out to new catalysts for IBM.
“The last couple of years has been AI eating software, and it’s a complete unwinding of “software is eating the world.” You’re seeing the SaaS companies become the hardware companies, and the hardware companies become more like the SaaS companies, and the semis obviously. We’re seeing a complete value shift that is revaluing hardware. We’re in the early innings for some of the legacy tech. But IBM Common Stock (NYSE:IBM) and Dell are getting a new lease on life. IBM Common Stock (NYSE:IBM) doing a great job, probably in quantum—we’ll see that later this decade—but they’re also reinventing themselves around infrastructure software, which is not SaaS, and it’s priced by the instance.”
7. Cisco Systems Inc (NASDAQ:CSCO)
Number of Hedge Fund Investors: 81
Jim Cramer in a program earlier in October said that Cisco’s valuation is attractive and the company can benefit amid rising demand due to AI.
“Cisco right now just unveiled a chip and networking system for, of course, the data center to connect AI data centers. This is something that Broadcom has been doing quite effectively. So you might say this is a good example of what’s going on. Here’s Cisco, and we remember they were the most overvalued company in 2000. So someone’s going to say that was a different Cisco. But here, Cisco makes a much lower 16-times-earnings stock, not 400-times earnings. The other one was actually about 40 times earnings. I look at this deal and I say, okay, Cisco and Broadcom—is there enough business for both? The reason why you don’t have to worry is there’s so much business out there. Broadcom is everywhere. I think that you can own them both. My charitable trust does own them both. That’s not because we think that both of them are going to clash and therefore there’s only one winner. We’re doing it because there’s so much business to be had that I think both are buys, and Cisco’s very low multiples. I was going to say it’s much cheaper on a multiple basis than Broadcom.”
6. Advanced Micro Devices Inc (NASDAQ:AMD)
Number of Hedge Fund Investors: 113
Ben Reitzes, Melius Research’s head of technology research, said in a program earlier in October that AMD is one of the “elite” semiconductor stocks he’s recommending.
“Well, we cover AI in general, and semis are part of it. We also cover Microsoft, Oracle, and many others, including Dell, and we see a lot of opportunities to win here. In semis, we’re kind of recommending the elite three now, which are Nvidia, Broadcom, and Advanced Micro Devices Inc (NASDAQ:AMD). We think the TAM for compute and networking is $2 trillion by the end of this decade, and maybe even higher. All this inferencing, and then autonomous vehicles and robots, are really going to continue to build out the infrastructure. Sit tight.”
Macquarie Core Equity Fund stated the following regarding Advanced Micro Devices, Inc. (NASDAQ:AMD) in its second quarter 2025 investor letter:
“Advanced Micro Devices, Inc. (NASDAQ:AMD) designs and manufactures semiconductors, including central processing units (CPUs), graphics processing units (GPUs), and other high-performance computing solutions for various markets like gaming, data centers, and AI. The company currently maintains a small market share for GPUs used for AI applications though by 2027, we believe the company will have product on par with the market leader, NVIDIA. Hyperscale customers with deep programming expertise may increasingly decide to dual-source high-end chips leading to much larger revenue and profit gains in coming years for AMD than investors currently expect.”
5. Oracle Corp (NYSE:ORCL)
Number of Hedge Fund Investors: 124
Jim Lebenthal, chief equity strategist at Cerity Partners, said in a latest program on CNBC that The Information’s report about Oracle Corp (NYSE:ORCL) margins was “unsubstantiated” and insisted that it can be called a “rumor.”
“I believe in the name and I’ve been looking for the place at which to add it…We don’t know what this unsubstantiated rumor is, where it came from, if it’s substantiated or not.”
Asked how the report can be called a rumor, the analyst said:
“It came from a news report that supposedly they saw an internal document. It was not a release by Oracle. It’s not far different than—it’s far different than a rumor. Show me. Show me the internal document. Show me a report from Oracle. Not you in particular, but one in general. It is unsubstantiated. I mean, it’s just an unsubstantiated report.”
Mar Vista U.S. Quality Strategy stated the following regarding Oracle Corporation (NYSE:ORCL) in its third quarter 2025 investor letter:
“Oracle Corporation’s (NYSE:ORCL) stock responded positively to its FQ1 2026 (August quarter) results, which many on Wall Street have characterized as the company’s “NVIDIA moment.” Remaining Performance Obligations (RPO; like contracted bookings) increased by $317 billion sequentially, reaching approximately $455 billion. This unprecedented surge was driven by four multi-billion-dollar contracts with three large customers who support training and inference workloads for leading large language model providers.
Management outlined a multi-year revenue roadmap that calls for $144 billion in its OCI (Oracle Cloud Infrastructure) infrastructure-as-a-service (IaaS) revenue by FY 2030, a striking step-up from approximately $10 billion reported in FY 2025. The scale and duration of these contracts are unmatched in the industry, and Oracle expects additional multi-billion-dollar deals to push RPO beyond $500 billion by fiscal year-end 2026. We believe Oracle is emerging as a Tier-1 hyperscale cloud provider, now viewed as a true peer to Microsoft Azure, Google Cloud Platform, and AWS.
While IaaS revenue carries lower gross margins compared to Oracle’s core database and enterprise SaaS (software-as-a-service) businesses, the sheer scale of growth is set to drive accelerating revenue and EPS expansion over the intermediate term. We continue to hold our position in ORCL as the company gains meaningful share in the rapidly expanding generative AI market.”
