Wall Street is assessing the latest quarterly results from some of the major AI companies to gauge the health of the market and clues on spending and demand from hyperscalers. Many top AI companies posted strong results and issued mind-boggling forecasts, cementing predictions that the AI revolution is just getting started. Some analysts believe the insane pay packages being offered to the top tech talent is another sign of growing demand in the industry.

Alex Heath, The Verge deputy editor, said in a recent program on CNBC that huge pay packages offered by AI companies make sense because of strong demand from hyperscalers.

“Open AI, for example, their research team is probably two to 300 people. Their core research team, the people getting these really insane, you know, sometimes nine figure, even eight figure offers,” Heath said. “This is basic supply and demand. You know, the people that build these frontier models, there’s just not enough of them given the the capex that’s going to them just from the hyperscalers alone. If you’re paying Steph Curry at the NBA 60 million a year in a market like the NBA that’s doing 12 billion a year in revenue, why doesn’t it make sense to spend a billion on the core team that’s in an industry where the hyperscalers are….”

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).

READ ALSO: 7 Best Stocks to Buy For Long-Term and 8 Cheap Jim Cramer Stocks to Invest In.

10. Kraft Heinz Co (NASDAQ:KHC)

Number of Hedge Fund Investors: 45

Mario Gabelli, GAMCO Investors chairman and CEO, said in a recent program on CNBC that he’d be a “buyer” of Kraft Heinz Co (NASDAQ:KHC) in pieces and he’s thinking of buying the stock. He was commenting on Kraft Heinz Co (NASDAQ:KHC)’s plan to split into two companies.

“Basically the split up pieces can be worth as high as in the mid30s. So you like the financial engineering? It’s not we don’t like or dislike. We’re just observing it. We own it. We didn’t buy any recently. We’re thinking about doing that. We’re having an internal challenge and debate with our teammates. So, we’ll probably be more of a buyer of the pieces,” Gabelli said.

Longleaf Partners Fund stated the following regarding The Kraft Heinz Company (NASDAQ:KHC) in its second quarter 2025 investor letter:

“The Kraft Heinz Company (NASDAQ:KHC) – Global food and beverage producer Kraft Heinz was a detractor for the quarter. Despite a sluggish food and beverage industry, the company’s performance is underpinned by a quality mix shift towards premium offerings like Heinz, Philadelphia and Ore-Ida, among other power brands, that we believe the market is overlooking. There is also speculation that large shareholder Berkshire Hathway is considering decreasing its position, although we believe this situation is more nuanced. Further upside could materialize from the outcome of an ongoing strategic alternatives exploration.”

9. Home Depot Inc (NYSE:HD)

Number of Hedge Fund Investors: 93

Kevin Simpson, Capital Wealth Planning founder and CIO, said in a recent program on CNBC that he’s buying Home Depot amid expectations of a rate cut. The analyst sees a new cycle of home renovation coming in the US.

“I think it’s just as pure as a lower rate environment because if you think about the retail consumer, we’ve been waiting since the pandemic for massive upgrades—appliances, wall coverings, floor coverings. But it’s not just the retail consumer. If you think about it a little bit further, multifamily homes and commercials haven’t done much in 3 years, just waiting for rates to come down. So, we’re going to see a big overhaul for new lobbies, new elevators, all of the things that you would do in your home, you’re going to see in multifamily. So, yes, this is a lower rate play. Get almost a 3% dividend while you wait.”

The London Company Large Cap Strategy stated the following regarding The Home Depot, Inc. (NYSE:HD) in its Q1 2025 investor letter:

“Exited: The Home Depot, Inc. (NYSE:HD) – Sale reflects a relatively high valuation (18.6x trailing EBITDA) along with a mixed outlook for consumer spending and housing activity. While the aging housing base and stable housing values are a positive for home improvement spending, we note that we already have exposure via Lowe’s and didn’t feel the need to own both companies.”

8. Snowflake Inc (NYSE:SNOW)

Number of Hedge Fund Investors: 100

Stephanie Link, CIO at Hightower, explained in a recent program on CNBC why she loaded up on Snowflake. The analyst cited Snowflake’s earnings growth and momentum due to AI and data centers as her reason to be bullish on the stock.

“They have a new CEO that will be joining the company. He has massive experience in the industry. The old CFO is simply retiring. I have no issues whatsoever with the transition. I think it’s going to be great. This company is growing earnings at 94%. They’re growing product revenue growth at 32%. Operating margins just rose 610 basis points. I just think the company is in the beginning stages in terms of collecting data and having the size and the scale, and they’re going to continue to gain momentum as we’re all talking about AI and data centers and all that stuff. To me, a 5% drop on something that I think was kind of silly, after such a great quarter, Frank, it was just too tempting.”

Burke Wealth Management stated the following regarding Snowflake Inc. (NYSE:SNOW) in its second quarter 2025 investor letter:

“Snowflake Inc. (NYSE:SNOW): Shares of Snowflake were up 53% during the second quarter and have almost doubled off of their September lows. 2024 was a transition year at Snowflake as Sridhar Ramaswamy took over as CEO and the company materially accelerated its AI related product pipeline. As we work our way through 2025, Snowflake’s AI strategy is beginning to come into focus and to put it mildly, the opportunity is intriguing. Historically, Snowflake has given customers the ability to query and analyze company data, both structured and unstructured, across all public clouds in a secure, user-friendly manner. As we move into the AI age, Snowflake’s ambition is to allow this analysis to take place in real-time, often through the use of AI agents whether it be through Snowflake’s own applications or secure third-party applications. Snowflake’s position right next to the customer’s data offers protection against disintermediation from third-party data analytics applications. Instead, this work will be done by Snowflake’s internal applications or by third-party applications that connect securely to the data via the Snowflake platform. This is an advantaged position within an enterprise. Data analytics is a rapidly evolving market. Add into this Snowflake’s consumption based pricing model that can pick up changes in demand signals, real or transitory, on a quarter by quarter basis and it is no wonder that this is a volatile stock. That said, as Snowflake’s AI strategy plays out in the years to come, we think the upside in the shares make what can sometimes be a wild ride in the share price one worth taking.”

7. Tesla Inc (NASDAQ:TSLA)

Number of Hedge Fund Investors: 115

Jeff Sonnenfeld, Yale School of Management senior associate dean, said in a recent program on CNBC that investors are relying too much on the capabilities of Tesla CEO Elon Musk. He called TSLA a meme stock and highlighted its high valuation.

“This is the biggest meme stock we’ve ever seen. Even at its peak, Amazon was nowhere near this level. The PE on this, well above 200, is just crazy. When you’ve got stocks like Nvidia, the price-earnings ratio is around 25 or 30, and Apple is maybe 35 or 36, Microsoft around the same. I mean, this is way out of line to be at a 220 PE. It’s crazy, and they’ve, I think, put a little too much emphasis on the magic wand of Musk.”

Tesla’s EV sales are falling all over the world as the company faces challenges from competitors. Tesla’s global sales in the second quarter fell 14% year over year. Even if Elon Musk increases his focus to fix the company’s problems, it would take a lot of effort to come out of the demand crisis. For example, in California, the largest U.S. market for electric vehicle adoption and sales, Tesla sales fell about 12% year over year in 2024, causing its market share to drop from 60.1% in 2023 to 52.5% in 2024. Was it because Californians are buying fewer EVs? No. Californians purchased more than 2 million electric cars during the year, almost double when compared to the past two years.

Baron Focused Growth Fund stated the following regarding Tesla, Inc. (NASDAQ:TSLA) in its second quarter 2025 investor letter:

“Tesla, Inc. (NASDAQ:TSLA) designs, manufactures, and sells electric vehicles (EVs), solar products, and energy storage solutions, while also developing advanced real-world AI technologies. Despite ongoing macroeconomic challenges and regulatory complexities, shares climbed after Tesla completed a limited commercial rollout of its highly anticipated robotaxi business in Austin—following more than a decade of development and billions of dollars in investment. This milestone signals a potentially transformative shift in the automotive industry and opens up a sizable new market beyond the company’s core operations. Investor sentiment also improved after Elon Musk stepped back from government-related engagements, boosting confidence in Tesla’s near-term execution. Tesla introduced a refreshed Model Y globally, featuring design and performance upgrades, and outlined plans to unveil new mass-market models starting next quarter. Meanwhile, the company is progressing toward scaling production of its humanoid robot, adding another dimension to its long-term growth story.”

6. Oracle Corp (NYSE:ORCL)

Number of Hedge Fund Investors: 124

Oracle Corp (NYSE:ORCL) shares skyrocketed after the company’s latest quarterly results. The company said it expects booked revenue to exceed $0.5 trillion. Oracle’s moat is its strong roots in enterprise databases and ERP software that are in high demand with large clients like banks and hospitals. Oracle Corp (NYSE:ORCL) differentiates itself by offering cheaper cloud services while integrating SaaS, ERP, and HCM, creating high switching costs and a durable moat.

Answering a question about Oracle, Goldman Sachs Global Institute Co-Founder George Lee said in a recent program on CNBC that the demand for compute is driving the growth of companies like Oracle Corp (NYSE:ORCL).

“It’s certainly an extraordinary market event for a company of that scale for sure. I think it just reflects this situation we find ourselves in where the infrastructure boom is so profound and yet we find ourselves in a moment of capacity constraint. There just aren’t enough compute cycles to meet the demand for tokens in the world. And so Oracle’s booming business, the booming business of all these hyperscalers, they’re delivering this these computational cycles. It’s just a commentary on on what we see in the in the kind of demand and consumption profile of intelligent tokens.”

Loomis Sayles Growth Fund stated the following regarding Oracle Corporation (NYSE:ORCL) in its second quarter 2025 investor letter:

“Oracle Corporation (NYSE:ORCL) is a leader in the enterprise software market with a strong market position in database, infrastructure and application software, and cloud-based software and services. We believe the company’s competitive advantages include its large and experienced direct sales force, a founder-driven management team that reinvests relentlessly to maintain a leading intellectual property (IP) portfolio and differentiated product suite, and a large installed base of clients with high switching costs where it consistently achieves renewal and retention rates in the mid-90% range. We believe Oracle is well positioned to benefit from the continuing growth in data storage and enterprise application software, as well as the shift to cloud-based solutions.

A long-term fund holding, Oracle reported strong quarterly financial results that were above management guidance and consensus expectations on most measures, including remaining performance obligation (RPO) bookings, a forward-looking measure of revenue. As a result, the company expects revenue growth to accelerate and raised its guidance to at least 16% revenue growth in its 2026 fiscal year, driven by cloud growth in excess of 40%. Oracle is the world leader in its largest business segment, enterprise database software used in customer on-premise IT environments. However, the company continues to focus on transitioning its business from a traditional on-premise, up-front software licensing and maintenance revenue model to a cloud computing subscription-based model where software revenue is recognized over the life of the client’s contract. While there has been pressure on year-over-year overall revenue comparisons during this transition, which started over a decade ago as Oracle released cloud versions of its applications and infrastructure software, as up-front license revenue shifts to subscription revenue, we have long expected this to lead to faster growth over time due to a higher customer lifetime value as the transition progresses. We believe the cloud model also allows Oracle to monetize its services and technology more efficiently and yield savings to the customer… (Click here to read the full text)

5. Apple Inc (NASDAQ:AAPL)

Number of Hedge Fund Investors: 156

Apple (NASDAQ:AAPL) is trending after the company revealed its new iPhone 17. While many on Wall Street are expecting the company to benefit from an upgrade “super cycle,” some say the new device would not bring strong sales for Apple Inc (NASDAQ:AAPL). AT&T CEO John Stankey recently said that he does not believe the new device will result in a super cycle for Apple (NASDAQ:AAPL).

“It’s obviously important to a large portion of our customer base that use those devices. So, we do watch it closely and have obviously worked with Apple for many years as a partner in distributing their equipment. I’m not expecting it’s going to be anything what I would call earthshattering or framebreaking. Every time you’re not anticipating a super cycle. I’m not anticipating the infamous super super cycle, but who knows? The customer will ultimately decide that,” Stankey said, according to CNBC.

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.”

4. Broadcom Inc (NASDAQ:AVGO)

Number of Hedge Fund Investors: 156

Stephen Weiss, the Chief Investment Officer and Managing Partner of Short Hills Capital Partners, said in a recent program on CNBC that Broadcom is expensive. However, he believes it’s a good “alternative” for people looking for “less advanced” chips.

“I’m not worried about Nvidia given its growth rate. Sure, it’s expensive, but given its growth rate, the peg is not overly out of sight. Broadcom, on the other hand, I think Broadcom is too expensive, and I don’t think they’re going to take over Nvidia anytime soon. But for less advanced chips that people want, it’s a good alternative.”

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.

Renaissance Large Cap Growth Strategy stated the following regarding Broadcom Inc. (NASDAQ:AVGO) in its second quarter 2025 investor letter:

“Broadcom Inc. (NASDAQ:AVGO) was the largest contributor to our portfolio performance in the second quarter after reporting strong operating results and guidance. The stock benefited from continued invest tor enthusiasm for high growth momentum stocks, as well as from companies with exposure to artificial intelligence. Importantly, Broadcom has been growing its hyperscale and connectivity product portfolios, resulting in increasing revenue exposure to faster growing artificial intelligence applications and offsetting a slowdown in its legacy semiconductor business.”