In this article, we will discuss the 11 Best Affordable AI Stocks to Buy Now.
Is artificial intelligence a bubble or not? That’s the million-dollar question evoking mixed reactions on Wall Street. While Nvidia’s Jensen Huang insists we are not in an AI bubble, billionaire investor Jeff Bezos has echoed warning bells about a bubble around revolutionary technology. The human face of the AI Boom, Sam Altman, believes there is a higher risk that some investors will lose substantial sums amid the AI bubble.
The bubble chatter comes amid the AI boom, accounting for about 75% of the S&P 500’s gains since 2022. A point of concern is that the gains have mainly been concentrated in the magnificent seven stocks. According to Goldman Sachs, capital expenditure on AI is poised to hit $390 billion in 2025 and increase by 19% in 2026. On the other hand, Bank of America expects AI expenditure to hit $1.2 trillion in 2030. If the billions of dollars invested in the technology do not yield returns, the fallout for the stocks will be severe.
Likewise, global stocks have come under pressure heading into year-end amid concerns about AI valuations.
“I think if you step back and look at valuations; it’s very hard to argue there’s not a bubble in the U.S. market. You have this phenomenal earnings growth, and there’s little sign of it weakening at this stage, [and at the same time] you’re getting a normalization of interest rates and discount rates,” said Dan Hanbury, who co-manages the Global Strategic Equity strategy at investment manager Ninety One.
Tom Hancock, who runs the GMO U.S. Quality ETF (QLTY), insists investors should take advantage of AI volatility to scoop up shares at a discount.
“We do expect a lot of this kind of volatility going forward. A real, maybe fundamental risk that could come from the volatilities is that the funding dries up if risk aversion rises to a level where investors aren’t willing to support the capex. So where we want to buy are companies where we feel like they can weather that storm. The hyperscalers is particularly where we like to position around the trade,” Hancock said
Amid the AI Bubble and valuation concerns, let’s take a look at the Best Affordable AI Stocks to Buy Now.
Our Methodology
To compile our list of 11 Best Affordable AI Stocks to Buy Now, we scanned ETFs and other online sources for companies with significant exposure to artificial intelligence technology. We focused on stocks with positive upside potential and are popular among elite hedge funds in the third quarter of 2025. We narrowed our list to AI stocks with a forward price-to-earnings multiple of less than 15 as of December 15. Finally, we arranged the stocks in ascending order based on the number of hedge funds holding positions.
Why are we interested in the stocks that hedge funds pile into? The reason is simple: our research shows 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).
Best Affordable AI Stocks to Buy Now
11. Gorilla Technology Group Inc. (NASDAQ:GRRR)
Forward P/E. 7.05
Stock Upside Potential: 153.25%
Number of Hedge Fund Holders: 9
Gorilla Technology Group Inc. (NASDAQ:GRRR) is one of the best affordable AI stocks to buy now. On December 10, Northland Securities analyst Michael Latimore reaffirmed a Buy rating on Gorilla Technology Group Inc. (NASDAQ:GRRR), with a $35.00 price target.
On December 8, the company completed a strategic investment in infrastructure intelligence company Astrikos.ai. The investment will strengthen the company’s position in India’s AI-ready digital infrastructure market, poised to grow from $1.19 billion in 2025 to more than $3.10 billion in 2030. Astrikos.ai’s technology has already been used across multiple programs, including state-level smart city platforms and the New Indian Parliament complex.
The merger of the two companies’ technologies should lead to smarter, faster, and more resilient AI infrastructure. Astrikos.ai is to provide Gorilla Technology the firepower to push for opportunities in the United Arab Emirates, the USA, and India, leading technology markets.
The investment comes as Gorilla Technology seeks to enhance its video intelligence stack, smart city architecture, and GPU-as-a-Service data center model. Astrikos.ai has made a name for itself in the development of real-time monitoring, prediction, and optimization for critical national systems.
“By joining forces with Astrikos.ai, we combine their deep Indian presence and infrastructure intelligence engine with our proven delivery across the Middle East and Asia. We can deliver AI-ready national infrastructure at scale and move decisively into markets that are expanding at historic speed,” said Jay Chandan, Chairman and CEO of Gorilla.
Gorilla Technology Group Inc. (NASDAQ:GRRR) provides AI-powered solutions for Security Intelligence, Network Intelligence, Business Intelligence, and IoT, focusing on smart city infrastructure, government, manufacturing, and retail through video analytics.
10. Palladyne AI Corp. (NASDAQ:PDYN)
Forward P/E. 4.61
Stock Upside Potential: 84.47%
Number of Hedge Fund Holders: 14
Palladyne AI Corp (NASDAQ:PDYN) is one of the best affordable AI stocks to buy now. Palladyne AI Corp (NASDAQ:PDYN) commands a Moderate Buy consensus rating on Wall Street. Analysts have an average price target of $9.50, implying 84.47% upside potential.
On November 17, the company announced the formation of Palladyne Defense to conduct multiple acquisitions. The company acquired GuideTech LLC, Warnke Precision Machining, and MKR Fabricators for approximately $31 million.
The acquisitions come as the AI software developer seeks to become an integrated defense technology company focused on providing avionics, components, and software, along with design and engineering services.
Additionally, the acquisitions will unite the company’s patented embodied AI with UAV and loitering munitions components. They will also deliver revenue-generating assets while supporting the company’s push to support the Department of War’s modernization priorities.
The acquisitions are expected to bolster Palladyne AI’s revenue base, which could triple to $7.8 million by 2026, up from $7.8 million in 2024. The acquisitions already come with an 18-month backlog of more than $10 million
“This marks a defining inflection point for Palladyne AI. Through the creation of Palladyne Defense, we are transforming from an AI software innovator into a vertically integrated defense technology company,” said Ben Wolff, President and CEO of Palladyne AI.
Palladyne AI Corp. (NASDAQ:PDYN) develops Embodied AI software and hardware for autonomous robots, enabling them to “think, move, and adapt” in real-world settings such as manufacturing, defense, logistics, and aviation. It focuses on allowing the machines to learn and operate independently in dynamic environments without extensive programming.
9. NICE Ltd. (NASDAQ:NICE)
Forward P/E: 9.35
Stock Upside Potential: 45.16%
Number of Hedge Fund Holders: 22
NICE Ltd. (NASDAQ:NICE) is one of the best affordable AI stocks to buy now. On December 10, NICE (NASDAQ:NICE) unveiled its CXone Mpower platform on a locally hosted cloud in South Africa, backed by redundant data centers in both Cape Town and Johannesburg. While the stock has declined roughly 35% over the past six months, the company continues to show financial strength, holding more cash than debt and maintaining a gross margin of about 67% as it expands its global footprint.
By hosting the platform entirely within South Africa, NICE ensures that applications and customer data remain in-country, meeting local regulatory requirements. The company has also invested in regional telecom infrastructure so voice traffic stays local, helping to lower latency and improve call quality. The rollout is aimed at banks, other highly regulated industries, and large organizations upgrading their customer engagement systems.
CXone Mpower combines NICE’s agentic AI capabilities, strengthened through its acquisition of Cognigy, to support both automated and live-agent interactions. The platform is designed to manage customer journeys across multiple channels while integrating workforce management tools, positioning South Africa as a growing center for AI-powered customer service.
According to NICE, the launch is part of a broader expansion across Africa, with additional deployments already in progress in several countries. The company plans to work closely with local partners through briefings and workshops. Earlier in the week, Wedbush analyst Daniel Ives downgraded the stock to Hold and set a $120 price target.
NICE Ltd. (NASDAQ:NICE) provides AI-driven cloud solutions that support customer engagement and financial crime prevention across global markets. Its product portfolio includes CXone Mpower for automating and enhancing customer service, Evidencentral for managing digital evidence, X-Sight for advanced AI applications, and Xceed for anti–money laundering and fraud detection. In addition, the company offers data intelligence tools designed to help organizations identify, monitor, and reduce financial crime risks.
8. Concentrix Corporation (NASDAQ:CNXC)
Forward P/E: 3.29
Stock Upside Potential: 66.62%
Number of Hedge Fund Holders: 23
Concentrix Corporation (NASDAQ:CNXC) is one of the best affordable AI stocks to buy now. On December 9, the company confirmed that its intelligent experience iX Product Suite has been certified, having met leading artificial intelligence governance, privacy, and security standards. The iX suite, a collection of AI-powered products, is designed to improve the customer experience and has received certification under the Artificial Intelligence Management System standard. The certification represents the first global standard tailored for AI governance.
The standard underscores the company’s commitment to ethical AI deployment. It will also provide clients with assurance regarding the governance standards of the technology offerings.
“Together with our clients, we’re continuing to invest in what’s next for AI and we’re seeing real momentum as more organizations turn our solutions into measurable business results,” said Chris Caldwell, President and CEO of Concentrix.
On November 24, Robert W. Baird analyst David Koning reaffirmed a Buy rating on Concentrix with a $62 price target, citing strong demand for higher-margin services, AI-driven solutions, and strategic growth initiatives. Concentrix is expected to achieve 12-13% EPS growth in 2026, supported by organic revenue growth, margin expansion, lower interest expenses, and share reductions.
Its expanding presence in trust and safety, content moderation, and software services further boosts revenue. Despite challenges like slower post-COVID volume growth and offshore shifts, the company aims for over 5% long-term organic growth. Barrington also maintained a Buy rating with the same target.
Meanwhile, on November 20, S&P Global downgraded the stock to BBB- from BBB, citing slower-than-expected earnings growth and deleveraging. According to the ratings firm, margin headwinds have overshadowed the company’s positive quarterly revenue trends.
Concentrix Corporation (NASDAQ:CNXC) is a global technology and services company that helps businesses modernize operations. It leverages AI to transform the customer experience (CX), building and deploying intelligent agents, automating tasks, and providing real-time agent assistance.
7. Kyndryl Holdings Inc. (NYSE:KD)
Forward P/E: 8.21
Stock Upside Potential: 23.97%
Number of Hedge Fund Holders: 24
Kyndryl Holdings Inc. (NYSE:KD) is one of the best affordable AI stocks to buy now. On November 26, Guggenheim analyst Jonathan Lee initiated coverage of the stock with a Buy rating and a $30 price target.
The positive rating comes on the heels of the company unveiling artificial intelligence-powered services for IBM z/OS customers. The services aim to accelerate application development, improve operational agility, and generate business insights on mainframe platforms.
The service combines the company’s mainframe expertise with agentic AI capabilities to accelerate decision-making and simplify complex processes across application and infrastructure management. The company plans to capitalize on a 2025 State of Mainframe Modernization Survey, which showed that 88% of respondents plan to implement AI in their mainframe environments.
“Kyndryl is leading the way in providing world-class agentic AI-enabled delivery services to customers that will instill confidence in the mainframe’s role as an engine of innovation for global enterprises,” said Hassan Zamat, Global Practice Leader for Core Enterprise & zCloud at Kyndryl.
The new AI-powered services should empower clients to deploy advanced AI on the mainframes to drive operational agility.
Earlier, on November 19, Kyndryl introduced its Agentic AI Digital Trust services to help companies manage AI securely across hybrid and multi-cloud setups. The new service functions as a central hub for tasks like discovering and testing AI agents, monitoring policies, reporting on compliance, and handling risk, all while working with existing security tools and major cloud platforms.
The launch follows findings from Kyndryl’s 2025 Readiness Report, which shows that most organizations are investing heavily in AI and feel pressure to demonstrate clear returns. Kris Lovejoy highlighted the risks of letting agentic AI operate without proper oversight. Working with Microsoft and using Microsoft Fabric tools, Kyndryl is positioning this service as part of its larger Agentic AI Framework to strengthen trust, compliance, and reliability in enterprise AI systems.
Kyndryl Holdings Inc. (NYSE:KD) is an IT infrastructure services provider, spun off from IBM, that designs, builds, manages, and modernizes complex, mission-critical technology systems. It helps enterprises adopt, manage, and scale AI solutions through consulting services, its proprietary Agentic AI Framework, and strategic partnerships.
6. Penguin Solutions, Inc. (NASDAQ:PENG)
Forward P/E: 12.48
Stock Upside Potential: 18.25%
Number of Hedge Fund Holders: 29
Penguin Solutions, Inc. (NASDAQ:PENG) is one of the best affordable AI stocks to buy now. Penguin Solutions, Inc. (NASDAQ:PENG) holds a Strong Buy rating from four analysts. On December 9, the company expanded its DDR5 SODIMM product lineup with the launch of SMART 64GB DDR5-6400 ECC CSODIMM memory modules as it continues to offer high-performance computing and AI infrastructure solutions.
Designed for high-performance computing in industrial, edge, telecom, and networking systems, the new modules are available in commercial and industrial temperature options. They also feature a clock driver that regenerates and amplifies the clock signal to maintain integrity at high speeds.
“Adding a 64GB DDR5-6400 ECC CSODIMM strengthens SMART’s leadership in ruggedized, high-performance memory solutions,” said Arthur Sainio, director of Integrated Memory DRAM product marketing at Penguin Solutions. “Industrial and networking customers now have access to both high-capacity and wide-temperature support in a very compact DDR5 SODIMM design.”
The unveiling of the new memory modules follows the confirmation that the company will integrate NVIDIA’s latest GPUs across its OriginAI solution. It plans to support NVIDIA DGX B300 and RTX PRO 6000 GPUs for training and inference workloads. The integration is part of an effort to make it easier for organizations to operationalize AI investments, simplify deployments, and accelerate AI adoption.
Penguin Solutions, Inc. (NASDAQ:PENG) specializes in designing, building, deploying, and managing large-scale AI and High-Performance Computing (HPC) infrastructure, essentially creating “AI factories” for enterprises. Leveraging its expertise and partners (like Dell), it provides turnkey solutions with hardware and its proprietary ICE ClusterWare software for efficient operation.
5. Amdocs Limited (NASDAQ:DOX)
Forward P/E: 10.54
Stock Upside Potential: 24.76%
Number of Hedge Fund Holders: 34
Amdocs Limited (NASDAQ:DOX) is one of the best affordable AI stocks to buy now. Amdocs Limited (NASDAQ:DOX) commands a consensus strong Buy rating on Wall Street. The average price target on the stock is $99, implying 24.76% upside potential from current levels.
On November 18, at Wells Fargo’s 9th Annual TMT Summit, the company reiterated its focus on leveraging artificial intelligence and cloud technologies to enhance customer experience. Consequently, the company is investing in AI and cloud technologies to improve its services and offerings in the telecommunications sector.
It’s also focusing on improving customer service KPIs through its Amaze platform. Amdocs has already achieved 40% -50% improvements in call center KPIs with its Amaze platform. It’s also developing Horizon Two to modernize customer systems using a cognitive core and generative AI.
The company has already inked strategic partnerships with tech giants Nvidia, AWS, and Microsoft, which are expected to drive innovation. It is to leverage Nvidia’s NIMS infrastructure for agentic capabilities, as it also invests in R&D and strategic partnerships to strengthen its competitive edge.
Additionally, it is positioning itself to capitalize on cloud migration as cloud-related businesses grow at double-digit rates. The company is to focus on helping customers migrate workloads to public clouds such as AWS, Azure, and GCP.
On November 18, Bank of America analyst Tal Liani reiterated his Buy rating on Amdocs and set a price target of $97, pointing to the company’s solid competitive position and long-term growth prospects, even as its FY26 guidance came in softer than expected. Liani emphasized the strength of Amdocs’ core operations and its continued work with T-Mobile during the carrier’s system transition. He also referenced several sizable contracts in the pipeline that are expected to support revenue growth in the back half of FY26. Additionally, Liani noted that the company’s decision to move away from lower-margin activities should help improve profitability and support sustainable growth over time.
Amdocs Limited (NASDAQ:DOX) is a software and Services Company that uses AI, especially Generative AI (GenAI), to help telecom and media companies automate operations, create new services, and improve customer experiences through its amAIz platform. It also focuses on data-driven insights, intelligent workflows, and secure AI deployment for network optimization.
4. Cognizant Technology Solutions Corporation (NASDAQ:CTSH)
Forward P/E: 14.93
Stock Upside Potential: 2.03%
Number of Hedge Fund Holders: 41
Cognizant Technology Solutions Corporation (NASDAQ:CTSH) is one of the best affordable AI stocks to buy now. On December 12, UBS analyst Kevin McVeigh reaffirmed a Hold rating on Cognizant Technology Solutions Corporation (NASDAQ:CTSH) with a price target of $85, while Citi’s Bryan Keane also maintained a Hold.
On December 10, the company inked a five-year strategic collaboration with German trading company BayWa. The agreement focuses on digital transformation and IT service operations. Cognizant is to manage BayWa’s core IT services, encompassing IT infrastructure, application management, and workplace services. The ultimate goal is to scale BayWa’s IT landscape by introducing AI and automation technologies.
“BayWa chose Cognizant because the service provider responds very flexibly to the needs of the diversified group and offers digital innovation and sustainable IT solutions,” said Thomas Dibbern, CIO at BayWa.
The BayWa collaboration comes on the heels of the company hitting its target of training one million individuals by 2026 and now plans to upskill to two million people by 2030. The initiative focuses on areas of enhanced learning and development resources.
“The expansion of our Synapse commitment marks a significant step toward building a more future-ready workforce,” said Ravi Kumar S., Chief Executive Officer at Cognizant. “We are proud to have surpassed our initial goal ahead of schedule.”
Meanwhile, analysts at William Blair upgraded Cognizant Technology Solutions to a Market Perform and Outperform on November 21. The upgrade is in response to the company’s accelerated AI-focused strategy and improved operational execution. According to the research firm, the company has entered a new phase of growth and profitability, driven by AI initiatives, better execution, and stronger demand across key verticals.
Cognizant Technology Solutions Corporation (NASDAQ:CTSH) uses AI to help clients modernize their businesses by integrating AI into their technology, processes, and experiences to drive efficiency, growth, and innovation. Their AI strategy centers on a platform called Cognizant Neuro AI, which offers a full range of tools and services for responsible enterprise-wide AI adoption.
3. Dell Technologies Inc. (NYSE:DELL)
Forward P/E: 11.39
Stock Upside Potential: 19.46%
Number of Hedge Fund Holders: 51
Dell Technologies Inc. (NYSE:DELL) is one of the best affordable AI stocks to buy now. On December 4, Dell Technologies Inc. (NYSE:DELL) announced a $0.525 quarterly cash dividend payable on January 30, 2026, to shareholders of record as of January 20, 2026
The company has increased its annual cash dividend by 18% in 2025 to $2.10, affirming its commitment to shareholder value. The dividend increase comes on the heels of the company’s AI-optimized server revenue, which beat expectations, topping $5.6 billion. Analysts at Piper Sandler have already reiterated their Overweight rating amid stronger-than-expected momentum in AI servers. AI server orders have already totaled $12.3 billion, exceeding market expectations.
Meanwhile, Mizuho raised its Dell price target to $175 from $170 on November 26, impressed by the company’s increase in its fiscal 2026 AI server revenue forecast to $25 billion from $20 billion. Server revenue in January is expected to top $9.4 billion, above consensus estimates of between $5.3 billion and $6 billion.
Dell’s AI server pipeline is experiencing robust growth, with the backlog increasing by 57% quarter over quarter in the third quarter to $18.4 billion. The research firm believes the AI pipeline has risen to $60 billion from a previous estimate of $38 billion.
Dell Technologies Inc. (NYSE:DELL) provides comprehensive Artificial Intelligence (AI) solutions through its Dell AI Factory initiative, which involves producing specialized hardware, software, and services to help customers manage the entire AI lifecycle. Their primary focus is on building the infrastructure (the “engines of intelligence”) that powers AI applications for other businesses.
2. Zoom Communications Inc (NASDAQ:ZM)
Forward P/E: 14.77
Stock Upside Potential: 8.29%
Number of Hedge Fund Holders: 54
Zoom Communications Inc (NASDAQ:ZM) is one of the best affordable AI stocks to buy now. On December 3, Zoom introduced Zoom for Defense, a secure, U.S.-based platform built to comply with the Department of Defense’s stringent IL4 security standards and NIPRNet requirements. Developed as an extension of Zoom for Government, the platform delivers compliant communication tools while preserving the familiar Zoom user experience. It is designed to support secure collaboration among defense agencies, contractors, and partners, allowing them to focus on critical mission objectives.
Offered exclusively through Carahsoft Technology Corp., Zoom for Defense includes capabilities such as Zoom AI Companion, Meetings, Team Chat, Webinars, Events, and Rooms, with Zoom Phone and Contact Center expected to follow. Zoom executives highlighted the company’s focus on privacy, security, and dependable technology, while Carahsoft emphasized the partnership’s importance in providing advanced, compliant collaboration solutions to the Department of Defense.
In a separate development, UBS reaffirmed its Neutral rating and $85 price target on Zoom Video Communications on November 25, following stronger-than-expected quarterly results. Revenue increased 4.4% year over year, exceeding forecasts by $15 million, while enterprise revenue grew 6%, above projections. The Online segment also posted a modest increase instead of the anticipated decline, and free cash flow margins reached 50%, well above UBS’s 40% estimate. Robust cash generation supported a 7% yield, with management continuing to return capital through share buybacks. UBS noted that earlier macroeconomic headwinds, including delayed deals, have largely eased.
After the earnings report, UBS slightly raised its revenue and free cash flow projections for FY27/CY26, while maintaining its Neutral outlook, citing the stock’s valuation at roughly 8x projected free cash flow. Zoom’s fiscal third-quarter 2026 results also drew broader analyst attention, with revenue surpassing expectations and earnings per share beating estimates by nine cents, highlighting the company’s ongoing operational strength.
Zoom Communications Inc (NASDAQ:ZM) operates an AI-first work platform that supports human connection across the Americas, Asia Pacific, Europe, the Middle East, and Africa.
1. Micron Technology, Inc. (NASDAQ:MU)
Forward P/E: 14.33
Stock Upside Potential: 6.79%
Number of Hedge Fund Holders: 105
Micron Technology, Inc. (NASDAQ:MU) is one of the best affordable AI stocks to buy now. On December 12, Stifel raised its price target on Micron (NASDAQ:MU) to $300, up sharply from $195, and reiterated its Buy rating. The firm pointed to accelerating demand for AI infrastructure as a key inflection point for the industry, noting that memory pricing has strengthened heading into year-end.
Stifel expects Micron to post solid results for fiscal first-quarter earnings, followed by a constructive outlook for the second quarter. According to the firm, improving profitability and more efficient bit production, combined with supportive market conditions, position the company well for continued momentum.
On December 12, UBS raised its price target on Micron Technology to $295 from $275 while keeping a Buy rating, citing strong momentum in DRAM and NAND pricing. UBS now expects DDR prices to rise 35% in Q4 2025 and NAND up 20%, with further gains projected into early 2026. Customers, including major cloud providers, are locking in multi‑year contracts through 2028 amid tight supply, and UBS estimates Micron’s EPS could reach $38 by 2027, reflecting continued robust demand and growth.
In a separate update, Micron announced on December 3 that it plans to wind down its Crucial consumer brand by February 2026 as it shifts its focus toward enterprise and commercial markets. The decision aligns with Micron’s broader push to support AI-driven data center demand and deepen relationships with key customers. Warranty support for existing Crucial products will continue, and affected employees will be reassigned where possible, reinforcing the company’s long-term focus on growth and innovation in memory and storage technologies.
Micron Technology, Inc. (NASDAQ:MU) is a key player in AI infrastructure, delivering advanced memory and storage solutions for artificial intelligence workloads. Its portfolio includes high‑performance DRAM, NAND, and NOR products that power data‑intensive applications across industries.
While we acknowledge the potential of Micron Technology, Inc. (NASDAQ:MU) as an investment, 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 MU and that has 100x upside potential, check out our report about this cheapest AI stock.
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