According to Josh Brown, Ritholtz Wealth Management CEO, the only way the S&P 500 could climb to 7,000 by year-end is through artificial intelligence.
“If we’re going to get to 7,000, it’s going to be because of the AI build out. That is the only pillar holding up the U.S. economic growth story right now.”
-Brown told CNBC
Brown’s comments were made in response to HSBC hiking its S & P 500 year-end target to 6,400 due to artificial intelligence.
It is true that even though stagflation and recession concerns remain, as evident from weak ISM services data and poor jobs report, AI names such as Palantir have been boosting the market.
“The companies that comprise all of the market cap in the S & P 100 and certainly the Nasdaq, that’s where the earnings growth is happening,” Brown said. “Everything that has to do with cloud computing and data center, it’s on fire.”
For this article, we selected AI stocks by going through news articles, stock analysis, and press releases. These stocks are also popular among hedge funds. The hedge fund data is as of Q1 2025.
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10. Super Micro Computer, Inc. (NASDAQ:SMCI)
Number of Hedge Fund Holders: 40
Super Micro Computer, Inc. (NASDAQ:SMCI) is one of the 10 High Flying AI Stocks This Week. On August 6, Needham analyst N. Quinn Bolton raised the price target on the stock to $60.00 (from $39.00) while maintaining a Buy rating. The rating affirmation comes despite SMCI fourth-quarter fiscal 2025 results falling short of market expectations.
The firm discussed the reason that led to the earnings miss.
“The miss was attributed to a lack of access to sufficient capital, which hindered the company’s ability to accelerate to volume production. The limited access to capital was due to the prior delay of the company’s 10-K filing, which has since been filed.”
Besides capital constraints stemming from delayed 10-K filing, specification changes from a new key customer led to revenue recognition delays.
“Additionally, a new key customer had specification changes that further delayed the recognition of revenue. In the near term, NG gross margin is expected to be under pressure due to larger deals and tariff costs.”
Regardless, the firm is still optimistic about the stock.
“However, we believe margins should improve in the upcoming quarters as the company ramps its DCBBS solutions and targets new growth markets.”
Super Micro Computer, Inc. (NASDAQ:SMCI) designs and manufactures high-performance server and storage solutions for data centers, cloud computing, AI, and edge computing worldwide.
9. Rivian Automotive, Inc. (NASDAQ:RIVN)
Number of Hedge Fund Holders: 41
Rivian Automotive, Inc. (NASDAQ:RIVN) is one of the 10 High Flying AI Stocks This Week. On August 6, Cantor Fitzgerald analyst Andres Sheppard reiterated a Neutral rating on the stock with a $15.00 price target.
Cantor has acknowledged that Rivian benefits from its Amazon commercial partnership, strategic joint venture with Volkswagen, and differentiated product offering including R1, EDVs, and the upcoming R2 vehicles.
The R2 line is particularly going to act as a meaningful catalyst, driving higher customer demand due to a more competitive price point.
The management is, however, discouraged by the company’s FY25 delivery guidance.
“However, while management disclosed that it expects Q3 deliveries to be its highest for the year, we remain discouraged by the company’s FY25 delivery guidance of 40,000 – 46,000 vehicles, which is lower than FY24 deliveries, and by the disappointing Gross Margin, which came way below expectations.”
The firm also discussed several factors driving their neutral stance, although it is excited about Rivian’s emphasis on autonomy in the upcoming Autonomy/AI investor day in Q4.
“Overall, we remain Neutral in the near term, driven by lower delivery expectations, worsening macro conditions, tariff uncertainty, the removal of the $7,500 EV Tax Credit, and uncertainty regarding the company’s autonomy and charging segments (which have yet to be quantified by management).”
Rivian Automotive, Inc. (NASDAQ:RIVN) is an automaker that creates and manufactures electric vehicles, as well as software and services.
