In this article, we will take a look at the overlooked AI stocks to buy now.
For the last couple of years, artificial intelligence has taken Wall Street by storm, driving innovation that’s transforming the way industries function. With investors piling stocks of the companies that dominate headlines, there might be those stocks that might be the market’s next breakout stories, but are currently under the radar.
Just as everyone used to be hyped about AI, the current hype seems to be about an “apparent” AI bubble. In an interview with Investopedia on October 1, Christopher Gannatti, Global Head of Research at financial services firm WisdomTree, said:
“The Mag 7’s share prices are a daily referendum on whether AI is considered hype or reality. They are priced as if AI is not just a growth driver, but the growth driver. It kind of started with the hyperscalers—Microsoft, Amazon, Alphabet—saying, ‘We have a certain amount of cash flow. We’re going to make investments.” Gannati further said, “AI companies are investing in one another, and using those investments to buy goods and services from each other. So, there’s a bit of circularity. None of these things is guaranteed. If the business environment changes, the music might need to stop—not necessarily forever, but for a while.”
On October 14, Jared Bernstein, a policy fellow at the Stanford Institute for Economic Policy Research and former chairman of President Biden’s Council of Economic Advisers, told CNBC that the current rise in AI stocks shows signs of a market bubble. Referring to one of his recent articles, Bernstein said that it’s challenging to predict bubbles precisely, but the typical traits include rapidly rising asset prices and extreme valuations. Moreover, AI investments now represent a larger share of the US economy, even higher than the proportion at the peak of the dot-com era. While there are many comparable differences in the fundamentals, such as the much stronger profitability and financial strength of AI companies compared to those in the dot-com era, he says there are enough historical parallels to raise concerns about the ongoing trends.
So far, technology companies have consistently demonstrated healthy gains from AI, keeping Wall Street satisfied. This should help the AI sector counter concerns about a potential bubble, as the companies jumping on the AI bandwagon are backed by the healthier balance sheets, deep pockets, and big names. For now, it’s good to see a significant shift toward AI.
Our methodology:
We have compiled a list of the 10 overlooked AI stocks to buy through a leading AI-stock ETF, Global X Artificial Intelligence & Technology ETF. While using its holdings as a base, we have filtered for stocks with a market capitalization of over $2 billion and an upside potential of at least 10%. Out of these stocks, we selected those that have the lowest number of hedge fund holdings, as data extracted from Insider Monkey’s Q2 2025 database, and ranked them in ascending order. The upside potential is calculated using one-year price targets by Yahoo Finance.
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. WeRide Inc. (NASDAQ:WRD)
Number of Hedge Fund holdings: 14
Upside Potential as of October 21, 2025: 58.66%
On September 29, 2025, Citi began coverage on WeRide Inc. (NASDAQ:WRD) with a ‘Buy’ rating and a price target of $15.50, suggesting a potential upside of nearly 58% from the current levels. This optimism is centered on the robotaxi sector, which the firm believes has reached an “inflection point.” Citi believes the penetration will rise from 0.1% in 2025 to 9.0% in 2030, and subsequently to 30% in 2035.
In addition to the growth in the Robotaxi industry, the firm highlighted the company’s overseas business expansion and high-computing-power domain control platform, demonstrating a strong cost structure and strategic collaborations with leading platform enterprises.
Separately, WeRide Inc. (NASDAQ:WRD) was invited to present at the 2025 World Intelligent Connected Vehicles Conference in Beijing from October 15 to 18. At the event, the company showcased four autonomous vehicle models, namely Robotaxi GXR, Robobus, sanitation truck S6, and sweeper S1, highlighting their versatile applications in mobility and urban services. While the other models are for short-distance transport and unmanned cleaning, the GXR specializes in 24/7 driverless operation, allowing WeRide Inc. (NASDAQ:WRD) to share its latest innovations with the world.
WeRide Inc. (NASDAQ:WRD) is a Chinese autonomous driving company that engages in cutting-edge technology for self-driving vehicles. Incorporated in 2017, the company has tested in over 30 cities across ten countries.
9. Pony AI Inc. (NASDAQ:PONY)
Number of Hedge Fund holdings: 19
Upside Potential as of October 21, 2025: 25.88%
On October 17, 2025, Pony AI Inc. (NASDAQ:PONY) announced its collaboration with Stellantis, a Dutch electric vehicle manufacturer, to develop L4 autonomous vehicles for the European market. While integrating Pony.ai’s autonomous driving technology through its European division headquartered in Luxembourg, the partnership will feature Stellantis’ autonomous driving-ready platform.
Initially, both entities plan to start deploying test vehicles powered by the Peugeot e-Traveller model only in Luxembourg, followed by a high-scale launch across European cities starting in 2026. The main focus of this partnership is on light commercial vehicles (LCVs), a segment led by Stellantis through its Pro One commercial vehicle business unit.
What’s even more interesting is that Stellantis’ autonomous driving-ready platform, exhibiting Level 4 capabilities, demonstrates the highest safety and reliability standards. When combined with Pony AI Inc. (NASDAQ:PONY)’s proven autonomous technology, it will lead to a new generation of smart and sustainable mobility solutions.
Pony AI Inc. (NASDAQ:PONY) is a Chinese autonomous mobility business providing robotaxi services, vehicle integration and engineering, robotruck services, and road-testing services. Founded in 2016, the company is committed to creating safe and efficient autonomous driving technology.
8. Snap Inc. (NYSE:SNAP)
Number of Hedge Fund holdings: 35
Upside Potential as of October 21, 2025: 21.11%
On October 17, 2025, Snap Inc. (NYSE:SNAP) received a ‘Hold’ rating from John Blackledge, an analyst at TD Cowen, with a price target of $9.00. While the analyst’s stance is cautious, the price target still reflects a potential upside of nearly 21%, due to various factors influencing the company’s financial outlook.
Although an improvement in revenue growth guidance for the third quarter of 2025 was noted, Snap Inc. (NYSE:SNAP) has encountered multiple challenges, according to the analyst. Among them are difficulties with ad auction pricing affecting campaign prices in the second quarter. Additionally, a temporary dip in ad pricing due to a surge in Sponsored Snaps ad inventory is considered a short-term challenge that sets the stage for success in the long haul.
The analyst outlines that Snap Inc. (NYSE:SNAP) remains under strain from weakened brand advertising and rising infrastructure expenses, but this is offset by the meaningful increase in active advertisers and a substantial growth in Snap+ revenue. For now, the analyst backs its stance with prospects from advertising revenue growth and margin expansion.
Snap Inc. (NYSE:SNAP) is a California-based technology company with operations in North America, Europe, and other international markets. Founded in 2010, the company offers Snapchat, a visual messaging application, Snapchat+, a subscription platform, and Spectacles, an eyewear product.
7. Genpact Limited (NYSE:G)
Number of Hedge Fund holdings: 35
Upside Potential as of October 21, 2025: 28.26%
According to the recent filing with the SEC, Truist Financial Corp increased its position in Genpact Limited (NYSE:G) by 8.4% during the second quarter. Following the purchase of 2,882 shares, the investor now owns 37,316 shares of the company’s stock, which translates to an investment worth $1,642,000.
Earlier in September, Genpact Limited (NYSE:G) announced its Insurance Policy Suite, a commercial and specialty business insurance solution powered by AI, expected to reduce processing cycle times by at least 75% compared to current processes.
As part of the Service-as-Agentic-Solutions portfolio, the suite utilizes Microsoft Azure AI technology to automate and optimize underwriting support tasks. Jinsook Han, the Corporate Development & Global Agentic AI Officer at Genpact Limited (NYSE:G), stated the suite was particularly designed for underwriters “so they can focus on delivering faster quotes, building better broker relationships, and increasing submission-to-bind ratios.”
Genpact Limited (NYSE:G) is a Bermuda-based provider of business process outsourcing and information technology services. With three primary segments — Financial services, Consumer and Healthcare, and High Tech and Manufacturing — the company is committed to helping its customers become more productive by making their businesses more adaptable.
6. Pegasystems Inc. (NASDAQ:PEGA)
Number of Hedge Fund holdings: 37
Upside Potential as of October 21, 2025: 22.23%
On October 15, 2025, Rosenblatt reiterated its ‘Buy’ rating on Pegasystems Inc. (NASDAQ:PEGA) and raised the price target to $65 from $61, suggesting a potential upside of about 16%.
This revision in outlook comes as the company plans to report its third-quarter earnings on October 21, after the market closes, with an earnings call the next morning. The analyst expects strong adoption of the Blueprint offering, which is expected to drive faster sales cycles and about 18% cloud revenue growth for the year, contributing up to 45% of total revenue.
The firm further highlights that the enterprise transformation company’s cloud annual contract value (ACV) mounted 28% YoY on a constant currency basis in the second quarter. This is supported by a surge in total ACV to $1,514 million, implying 16% YoY growth.
Pegasystems Inc. (NASDAQ:PEGA) is a Massachusetts-based company that specializes in enterprise software. Incorporated in 1983, the company provides Pega Infinity, Pega Customer Service, Pega Platform, Pega GenAI Blueprint, and Pega Cloud, among others.
5. Zebra Technologies Corporation (NASDAQ:ZBRA)
Number of Hedge Fund holdings: 53
Upside Potential as of October 21, 2025: 23.51%
On October 8, 2025, Truist Securities maintained its ‘Hold’ rating on Zebra Technologies Corporation (NASDAQ:ZBRA), while raising the price target to $350 from $319, suggesting an upside of around 14%. This revision was part of a research note previewing third-quarter results in Machinery, Infrastructure Services, and Multi-Industry Industrial Technology.
The third quarter is what the firm calls a “mixed bag,” stating that the Machinery business of Zebra Technologies Corporation (NASDAQ:ZBRA) faces margin risks in the latter half relative to the first half, as tariff headwinds materialize. Truist, however, highlighted that the segment may be given some flexibility, based on the chances that tariff-related margin pressures will remain limited to 2025.
The research firm notes that Multi-Industry earnings are anticipated to come broadly in line, emphasizing conservative assumptions for organic growth and the segment’s ability to adjust pricing in real time to counter any tariff impact. With a solid backlog, the Engineering and Construction group is expected to achieve decent beats and raises.
Zebra Technologies Corporation (NASDAQ:ZBRA), headquartered in Lincolnshire, Illinois, is a provider of enterprise asset intelligence solutions. With two main segments —Asset Intelligence and Tracking, and Enterprise Visibility and Mobility —the company serves the automatic identification and data capture solutions industry.
4. NXP Semiconductors N.V. (NASDAQ:NXPI)
Number of Hedge Fund holdings: 53
Upside Potential as of October 21, 2025: 17.06%
On October 10, 2025, Joshua Buchalter from TD Cowen reduced the price target on NXP Semiconductors N.V. (NASDAQ:NXPI) to $260 from $270 with an unchanged ‘Buy’ rating on the stock.
On October 2, Deutsche Bank’s research team named NXP Semiconductors N.V. (NASDAQ:NXPI) as a leading investment idea for the next 12 months. Later, the bank identified four Buy-rated semiconductor stocks ahead of third-quarter earnings, highlighting a widening gap between strong artificial intelligence demand and broader market weakness. While recognizing the company, the bank emphasized stocks with “reasonable” valuations, which it said “were growing increasingly rare.”
NXP Semiconductors N.V. (NASDAQ:NXPI) continues to benefit from strong execution in automotive and industrial segments, reaping rewards from growing electric vehicle adoption, according to the bank. Additionally, its stable margin performance and disciplined capital allocation strengthen investor confidence.
NXP Semiconductors N.V. (NASDAQ:NXPI), based in Eindhoven, the Netherlands, provides semiconductor products in countries including China, the United States, and Germany. Founded in 2006, it specializes in microcontrollers, application processors, communication processors, and wireless connectivity solutions.
3. Hewlett Packard Enterprise Company (NYSE:HPE)
Number of Hedge Fund holdings: 60
Upside Potential as of October 21, 2025: 15.51%
On October 16, 2025, KeyBanc reaffirmed its ‘Sector Weight’ rating on Hewlett Packard Enterprise Company (NYSE:HPE) after the company’s Strategic and Analytical Meeting (SAM). While remaining “underwhelmed” with the tech company’s 2026 and long-term financial targets highlighted at the event, the investment firm notes that pure-play companies demonstrate better quality assets in the IT hardware sector.
The firm further raised concerns regarding the company’s strategic approach to networking, which it referred to as “lack of clarity” on growth catalysts in that area. It remains uncertain how aggressive Hewlett Packard Enterprise Company (NYSE:HPE) will be in its server business, as KeyBanc pointed out.
While acknowledging HP Enterprise’s prioritized efforts in cost reduction and free cash flow returns to shareholders, the firm is certain of the company’s key controllable actions. Regarding the Juniper Networks integration, KeyBanc highlighted that Hewlett Packard Enterprise Company (NYSE:HPE) requires an “accelerating growth profile” to lift its share price.
Hewlett Packard Enterprise Company (NYSE:HPE) is a Texas-based company that provides solutions to facilitate seamless data operations. Founded in 1939, the company offers HPE ProLiant Rack and Tower servers, HPE Synergy, HPE Scale Up Servers, and HPE Aruba products, among others.
2. The Trade Desk, Inc. (NASDAQ:TTD)
Number of Hedge Fund holdings: 60
Upside Potential as of October 21, 2025: 31.74%
On September 30, 2025, Guggenheim reiterated its ‘Buy’ rating on The Trade Desk, Inc. (NASDAQ:TTD), while cutting the price target to $55.00 from $75.00. This revision stemmed from the intensifying competition, primarily driven by Amazon’s demand-side platform (DSP).
2025 is the year of transition, the analyst noted, emphasizing the company’s launch of its Kokai platform, double-digit headcount growth, and new leadership, featuring COO Vivek Kundra and CFO Alex Kayyal. Although there are concerns about the crowded DSP market, the firm believes this will continue to influence overall sentiment until The Trade Desk, Inc. (NASDAQ:TTD) reinvigorates growth. The company’s growth should pick up after Q2 2026, according to the analyst.
Guggenheim based its positive stance on the increased adoption of programmatic advertising on connected TV platforms, anticipated $40 million in political advertising contributions, and developments in audio monetization syncing with Spotify commentary.
The Trade Desk, Inc. (NASDAQ:TTD) is a California-based technology company offering a self-service cloud-based ad-buying platform, data, and other value-added services. Incorporated in 2009, the company is committed to transforming media by enhancing the relevance of advertising for consumers.
1. Synopsys, Inc. (NASDAQ:SNPS)
Number of Hedge Fund holdings: 66
Upside Potential as of October 21, 2025: 24.18%
On October 21, 2025, Siti Panigrahi, an analyst at Mizuho Securities, reaffirmed a ‘Buy’ rating on Synopsys, Inc. (NASDAQ:SNPS), setting the price target at $600, which implies an upside potential of approximately 32%.
Separately, on October 17, Keysight Technologies, Inc. announced the completion of its acquisition of the Optical Solutions Group from Synopsys, Inc. (NASDAQ:SNPS), enhancing not only the company’s design engineering software portfolio but also its computer-aided engineering capabilities.
Through Optical Solutions Group, a leading developer of optical design and analysis software, Keysight leverages tools such as CODE V, LightTools, ImSym, RSoft, and LucidShape to facilitate its customers in bringing their designs to the market faster. As stated by Niels Faché, Senior Vice President of Keysight’s Design Engineering Software,
“Keysight is expanding its high-performance, multi-physics design capabilities with the Optical Solutions Group and PowerArtist acquisitions. These additions enhance system-level simulation, enabling earlier, more accurate power, optical, and photonics design decisions.”
Synopsys, Inc. (NASDAQ:SNPS) is a California-based company that provides electronic design automation software products employed to build and test integrated circuits. With two main segments: Design Automation and Design IP, the company offers versatile silicon-to-systems solutions to create AI-driven products.
While we acknowledge the potential of SNPS 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 SNPS and that has 100x upside potential, check out our report about this cheapest AI stock.
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Disclosure: None.
