In this article, we will discuss: 11 Most Volatile Stocks to Buy According to Hedge Funds.
On February 17, 2026, Bloomberg reported that stocks fluctuated significantly as investors assessed the risks of artificial intelligence. The S&P 500 climbed 0.1%, while a software ETF sank 2.2%. Bitcoin held around $67,500, continuing its February slump. The 10-year Treasury yield increased one basis point to 4.06%. Gold dipped below $4,900 per ounce, retreating from recent record highs, as much of Asia stayed closed for the Lunar New Year. Morgan Stanley strategist Michael Wilson identified AI disruption, high capital spending, weak seasonals, and crowded momentum trades as volatility factors. Chris Larkin of Morgan Stanley’s E*Trade noted that prolonged fluctuations could result in a bumpy road. According to a Bloomberg analysis, AI disruption comments on earnings calls almost doubled from quarter to quarter.
Michael Hartnett of Bank of America said 35% of fund managers perceive overinvestment risk, while a quarter of respondents to the most recent BofA study identified an “AI bubble” as the top tail risk. JPMorgan strategists, headed by Dubravko Lakos-Bujas, predicted a 53% spike in AI-related capital expenditures over the next 12 months. Jean Boivin of BlackRock noted that markets are now considering AI an active threat.
With that said, here are the 11 Most Volatile Stocks to Buy According to Hedge Funds.
Photo by Arturo Añez on Unsplash
Our Methodology
We chose companies with betas ranging from 2 to 5 and market capitalizations over $2 billion. From the resultant dataset, we selected the 11 Most Volatile Stocks with the highest number of hedge fund holders for each stock using Insider Monkey’s database of hedge funds as of Q3 2025. Finally, we ranked these stocks in ascending order based on the number of hedge fund holders.
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).
11. Adaptive Biotechnologies Corporation (NASDAQ:ADPT)
Number of Hedge Fund Holders: 31
Beta Rating as of February 18: 2.18
Adaptive Biotechnologies Corporation (NASDAQ:ADPT) is among the Most Volatile Stocks.
On February 6, 2026, TD Cowen upgraded Adaptive Biotechnologies Corporation (NASDAQ:ADPT)’s price target to $21 from $20 while keeping a Buy rating, citing a Q4 beat and an improved outlook. TD Cowen said that community adoption, new indications, pharma guidelines, EMR integrations, and a shift to blood-based testing were major driving factors.
On February 6, 2026, BTIG maintained a Buy rating on Adaptive Biotechnologies Corporation (NASDAQ:ADPT) and increased its price target from $21 to $22, following Q4 earnings. BTIG describes the company as a leading growth story in specialty labs.
On February 6, 2026, JPMorgan boosted Adaptive Biotechnologies Corporation (NASDAQ:ADPT)’s price objective from $20 to $21 while retaining an Overweight rating, citing the Q4 report as strong. The corporation anticipates FY26 MRD business revenue of $255 million to $265 million, with total operating expenses, including cost of revenue, ranging from $350 million to $360 million.
Adaptive Biotechnologies Corporation (NASDAQ:ADPT) develops an immune medicine platform. The company provides immunoSEQ, clonoSEQ, cellular treatment, and vaccinations.
10. CAVA Group, Inc. (NYSE:CAVA)
Number of Hedge Fund Holders: 34
Beta Rating as of February 18: 2.43
CAVA Group, Inc. (NYSE:CAVA) is among the Most Volatile Stocks.
On February 18, 2026, UBS increased its price objective for CAVA Group, Inc. (NYSE:CAVA) from $66 to $69 while maintaining a Neutral rating. UBS anticipates Q4 same-store sales and profitability to outperform expectations, stating improved momentum into 2026 due to softer comps and sales initiatives. The firm said that the investment case remains appealing, but it seeks clearer 2026 visibility and sustained outsized growth before becoming more constructive.
On February 5, 2026, Benchmark commenced coverage on CAVA Group, Inc. (NYSE:CAVA) with a Buy rating and a price target of $80. Benchmark noted the company’s scale leadership in the Mediterranean category, reporting 450 units in 29 states and an industry-leading unit economic model that supports 15% annual unit growth.
On January 26, 2026, BofA hiked CAVA Group, Inc. (NYSE:CAVA)’s price goal to $82 from $80 while maintaining a Buy rating, updating forecasts, and valuation multiples across its restaurant coverage universe.
CAVA Group, Inc. (NYSE:CAVA) is a holding company that owns and operates the category-defining Mediterranean fast-casual restaurant brand. It operates in two segments: CAVA and CAVA Foods.
9. Century Aluminum Company (NASDAQ:CENX)
Number of Hedge Fund Holders: 36
Beta Rating as of February 18: 2.20
Century Aluminum Company (NASDAQ:CENX) is among the Most Volatile Stocks.
On February 3, 2026, B. Riley lifted Century Aluminum Company (NASDAQ:CENX)’s price objective to $64 from $37 while maintaining a Buy rating following the sale of the Hawesville facility to TeraWulf. B. Riley said that the minority holding could be worth more than $300 million and described the transaction as mutually beneficial.
On January 13, 2026, Wells Fargo elevated Century Aluminum Company (NASDAQ:CENX)’s price objective to $61 from $46 while retaining an Overweight rating. The firm predicted healthy copper and aluminum markets in 2026, noting limited new supply and persistent 50% US tariffs on imported steel and aluminum. It also pointed out demand risks and replacement.
On February 9, 2026, Century Aluminum Company (NASDAQ:CENX) and Emirates Global Aluminium hired Bechtel to do preliminary engineering for a main aluminum facility in Inola, Oklahoma. The project seeks to increase US primary aluminum production, with a final investment decision and development beginning by the end of 2026, creating 1,000 permanent jobs and 4,000 construction jobs.
Century Aluminum Company (NASDAQ:CENX) produces aluminum and operates reduction plants in the United States and Iceland. It produces standard ingots, T-ingot, extrusion billet, horizontal direct chill ingot, molten, slab, and sow.
8. Arm Holdings plc (NASDAQ:ARM)
Number of Hedge Fund Holders: 37
Beta Rating as of February 18: 4.37
Arm Holdings plc (NASDAQ:ARM) is among the Most Volatile Stocks.
On February 9, 2026, BofA increased Arm Holdings plc (NASDAQ:ARM) price objective to $135 from $115 while keeping a Neutral rating. Following Q4 earnings, the firm’s capex tracker revealed that global hyperscale capex reached $148 billion in Q4, up 14% quarter on quarter and 66% year on year. BofA forecasts capex of $748 billion in 2026 and $869 billion in 2027, representing a 56% and 16% surge, respectively. The firm updated objectives for businesses exposed to AI capex buildout.
RBC Capital cut Arm Holdings plc (NASDAQ:ARM)’s price objective to $130 from $140 and maintained its Outperform rating following Q3 earnings. RBC Capital noted a softer Q4 royalty growth expectation while citing management’s confidence in maintaining 20% growth in FY27.
On February 4, 2026, Arm Holdings plc (NASDAQ:ARM) reported fiscal Q3 sales of $1.24 billion, up 26% year on year, marking its fourth straight billion-dollar quarter. Royalty sales climbed 27% YoY to $737 million, while license and other revenue jumped 25% to $505 million YoY.
Arm Holdings plc (NASDAQ:ARM) is involved in the licensing, marketing, research, and development of microprocessors, system IP, graphics processing units, physical IP, and associated systems IP, software, and tools. It functions in three geographic segments: the United Kingdom, the United States, and other countries.
7. Archer Aviation Inc. (NYSE:ACHR)
Number of Hedge Fund Holders: 37
Beta Rating as of February 18: 3.11
Archer Aviation Inc. (NYSE:ACHR) is among the Most Volatile Stocks.
On January 8, 2026, Archer Aviation Inc. (NYSE:ACHR) stated at CES 2026 that it will use NVIDIA IGX Thor to develop and deploy next-generation aviation artificial intelligence. The firm aims to incorporate the technology into future aircraft iterations, providing high-reliability, real-time onboard computing for safety-critical applications. The companies have been collaborating since early 2025. The firm will launch the integration at Hawthorne Airport in Los Angeles, where it hopes to act as an operational hub for its planned LA air taxi network as well as a test bed for AI-powered aviation technologies. The corporation will concentrate on pilot safety and predictive awareness, autonomy-ready flight systems, and airspace integration.
On January 21, 2026, Archer Aviation Inc. (NYSE:ACHR) formed a deal with the Government of the Republic of Serbia, which selected the firm as its preferred eVTOL partner and acquired the option to purchase up to 25 Midnight aircraft.
Archer Aviation Inc. (NYSE:ACHR) is involved in the production of electric vertical take-off and landing aircraft. Brett Adcock and Adam Goldstein launched the company on October 16, 2018, and it is headquartered in San Jose, CA.
6. Dutch Bros Inc. (NYSE:BROS)
Number of Hedge Fund Holders: 46
Beta Rating as of February 18: 2.55
Dutch Bros Inc. (NYSE:BROS) is among the Most Volatile Stocks.
On February 13, 2026, Morgan Stanley lifted its price objective for Dutch Bros Inc. (NYSE:BROS)’s to $85 from $82 while retaining an Overweight rating. The firm noted a solid year-end performance as support for the stock, despite the ongoing dispute.
RBC Capital also cut Dutch Bros Inc. (NYSE:BROS)’s price target to $75 from $80 while maintaining an Outperform rating, noting Q4 results and FY26 forecasts that exceeded consensus and reduced buy-side expectations.
On the same day, Citi reduced Dutch Bros Inc. (NYSE:BROS)’s price objective from $82 to $81 while keeping its Buy rating.
On February 13, 2026, Dutch Bros Inc. (NYSE:BROS) forecasts FY26 revenue of $2.00 billion to $2.03 billion, compared to the consensus estimate of $2.04 billion. The firm said that it anticipates same-store sales growth of 3% to 5% and adjusted EBITDA of $355 million to $365 million, citing higher coffee costs offset by SG&A leverage. It projects capital expenditures ranging from $270 million to $290 million and at least 181 total system shop openings.
Dutch Bros Inc. (NYSE:BROS) operates and franchises drive-thru businesses that specialize in handcrafted beverages. It operates in three segments: company-operated shops, franchising, and other.
5. BrightSpring Health Services, Inc. (NASDAQ:BTSG)
Number of Hedge Fund Holders: 48
Beta Rating as of February 18: 2.38
BrightSpring Health Services, Inc. (NASAQ:BTSG) is among the Most Volatile Stocks.
On January 27, 2026, TD Cowen upgraded BrightSpring Health Services, Inc. (NASDAQ:BTSG)’s price objective to $46 from $42 while keeping a Buy rating. The firm noted strong specialty generics trends as a driver of ongoing Q4 momentum.
On January 23, 2026, BMO Capital boosted BrightSpring Health Services, Inc. (NASDAQ:BTSG)’s price target from $40 to $46 and maintained its Outperform rating. BMO Capital noted the firm’s competitive stance and solid pharmaceutical ties, which strengthened confidence in the sustainability of growth in its specialty division. The stock’s impressive performance was primarily driven by the acceleration of growth in the specialty area.
On February 2, 2026, BTIG elevated BrightSpring Health Services, Inc. (NASDAQ:BTSG)’s price target to $55 from $50 while maintaining a Buy rating. BTIG pointed out the company’s continuous performance over cycles, regarding it as a proven operator in its coverage of Healthcare IT and Digital Health businesses. BTIG acknowledged the stock’s strength and capacity to grow in the face of changing market conditions.
BrightSpring Health Services, Inc. (NASDAQ:BTSG) provides a platform for delivering complementary health care and pharmaceutical solutions. It operates in two segments: Pharmacy Solutions and Provider Services.
4. Affirm Holdings, Inc. (NASDAQ:AFRM)
Number of Hedge Fund Holders: 60
Beta Rating as of February 18: 3.58
Affirm Holdings, Inc. (NASDAQ:AFRM) is among the Most Volatile Stocks.
On February 17, 2026, Affirm Holdings, Inc. (NASDAQ:AFRM) announced a deal with Lowe’s. The firm will provide payment plans to Lowe’s customers both online and through the Lowe’s mobile app. Lowe’s will join the Affirm marketplace, boosting access to the company’s shopper network.
On February 9, 2026, Mizuho reduced Affirm Holdings, Inc. (NASDAQ:AFRM)’s price target to $95 from $114 while retaining an Outperform rating. The firm considered the post-earnings selloff as unjustified, citing two catalysts: an exclusive partnership with Intuit and a conservative fiscal 2026 forecast.
On February 6, 2026, RBC Capital downgraded Affirm Holdings, Inc. (NASDAQ:AFRM)’s price objective to $77 from $87 while maintaining a Sector Perform rating. RBC noted that targeted 0% APR offers drove merchant GMV, while unit economics supported profits. The firm stated forecasts calling for a slowdown and mentioned a significant enterprise client switching to its own wallet platform during Q1.
Affirm Holdings, Inc. (NASDAQ:AFRM) runs a platform for digital and mobile commerce. Its platform is made up of three main components: a consumer-focused app, merchant commerce solutions, and a point-of-sale payment solution for consumers.
3. Amer Sports, Inc. (NYSE:AS)
Number of Hedge Fund Holders: 63
Beta Rating as of February 18: 2.86
Amer Sports, Inc. (NYSE:AS) is among the Most Volatile Stocks.
On January 8, 2026, Deutsche Bank initiated coverage of Amer Sports, Inc. (NYSE:AS) with a Buy rating and a price objective of $49. The firm has resumed coverage of global brands, off-price, and niche beauty retail. Deutsche mentioned an unexpectedly robust retail year and anticipates a volatile but mostly risk-on macroeconomic backdrop in 2026. The firm predicted strong top-line growth in the first half, fueled by easier weather comparisons and increased tax refunds.
On February 10, 2026, UBS boosted Amer Sports, Inc. (NYSE:AS)’s price target to $60 from $58 while maintaining a Buy rating, noting a balanced upside and downside skew before the Q4 results report.
On January 14, 2026, Truist upgraded Amer Sports, Inc. (NYSE:AS)’s price goal to $46 from $45 while retaining a Buy rating. The firm anticipated softlines retail to profit in 2026, especially in the first half, from higher tax refunds and the World Cup.
Amer Sports, Inc. (NYSE:AS) manufactures, markets, and sells athletic equipment, apparel, and footwear. It operates in three segments: technical clothing, outdoor performance, and ball and racquet sports.
2. Bloom Energy Corporation (NYSE:BE)
Number of Hedge Fund Holders: 64
Beta Rating as of February 18: 3.12
Bloom Energy Corporation (NYSE:BE) is among the Most Volatile Stocks.
On February 10, 2026, Jefferies lifted Bloom Energy Corporation (NYSE:BE)’s price objective to $102 from $92 while retaining an Underperform rating. Jefferies claimed a $6 billion backlog for near-term visibility. The firm noted a lack of transparency on potential capacity expansions.
On February 9, 2026, Mizuho boosted Bloom Energy Corporation (NYSE:BE)’s price target to $110 from $89 and kept a Neutral rating following the Q4 results. The firm cited gross margin accretion in 2026 as a result of cost cuts and higher capacity utilization backed by book-and-bill visibility.
On the same day, BofA elevated Bloom Energy Corporation (NYSE:BE)’s price objective to $71 from $39 while keeping an Underperform rating. The firm noted improved near-term visibility following a clean Q4 beat while cautioning stock prices against an effortless multi-year shipment ramp and margin stabilization.
On February 6, 2026, UBS upgraded Bloom Energy Corporation (NYSE:BE)’s price goal from $115 to $170 while maintaining a Buy rating, citing a solid quarterly beat and a forecast exceeding expectations.
Bloom Energy Corporation (NYSE:BE) manufactures and installs solid oxide fuel cell-based power production platforms. Bloom Energy Server turns conventional low-pressure natural gas or biogas into electricity using an electrochemical method that does not include combustion.
1. AppLovin Corporation (NASDAQ:APP)
Number of Hedge Fund Holders: 110
Beta Rating as of February 18: 2.49
AppLovin Corporation (NASDAQ:APP) is among the Most Volatile Stocks.
On February 12, 2026, several analysts adjusted their price estimates on AppLovin Corporation (NASDAQ:APP).
Scotiabank upgraded AppLovin Corporation (NASDAQ:APP)’s price goal to $775 from $750 while retaining an Outperform rating. The company reported that Q4 revenue, EBITDA, and EPS exceeded forecasts. The management noted that the e-commerce self-service platform remains on schedule to be available in the first half of 2026. Scotiabank forecasts a solid 2026.
On the same day, BofA reduced its price objective on AppLovin Corporation (NASDAQ:APP) to $705 from $780 while maintaining a Buy rating. The firm said that the corporation’s valuation fell due to industry de-rating and sluggish e-commerce growth. BofA mentioned the corporation’s gaming business as a source of support.
Jefferies also reduced its price goal on AppLovin Corporation (NASDAQ:APP) to $700 from $860 while maintaining a Buy rating. The firm described quarterly results as outstanding after revising valuation assumptions.
Wedbush boosted its price target on AppLovin Corporation (NASDAQ:APP) to $640 from $465 while keeping an Outperform rating. The company noted a quarterly earnings beat and solid gaming performance.
AppLovin Corporation (NASDAQ:APP) develops and operates a mobile marketing platform. It provides AppDiscovery, MAX, Adjust, and SparkLabs. Its software-based platform enables mobile application developers to increase app marketing and revenue.
While we acknowledge the potential of APP 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 APP and that has 100x upside potential, check out our report about this cheapest AI stock.
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Disclosure: None. 11 Most Volatile Stocks to Buy According to Hedge Funds is originally published on Insider Monkey. Insider Monkey focuses on uncovering the best investment ideas of hedge funds and insiders. Please subscribe to our free daily e-newsletter to get the latest investment ideas from hedge funds’ investor letters by entering your email address below.
