12 AI Stocks Wall Street Is Watching Now: Nvidia, Micron, and More

In this article, we will look at the 12 AI Stocks Wall Street Is Watching Now: Nvidia, Micron, and More.

Wedbush’s Dan Ives told CNBC’s Squawk Box on Monday that the Nasdaq will rise to 30,000 points in the next year. He asserted that a strong earnings momentum will continue to fuel investor enthusiasm for AI stocks.

Earlier in the year, investor anxiety regarding the AI trade rose to a troubling level, with many treating AI bubble as a top global risk. According to a Bank of America Global Fund Manager Survey, a record number of investors believe that the AI bubble is a primary risk.

However, a strong tech earnings season has seemingly calmed down these jitters.

“These earnings have validated the AI bullish thesis,” Ives said. “Demand and supply is 10-1 for chips. We are in the early days still of the AI revolution. The haters will hate, and we know that.”

Ives believes that the AI rally is yet to continue for another two years. It’s the memory super-cycle, he noted, discussing the demand for memory chips ignited by a rapid AI infrastructure buildout.

“It’s about playing the hyperscalers — of course chips, then you have to play software, cybersecurity, infrastructure [and] power. You can’t just own one subsector, you have to own the derivative plays,” Ives said.

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 Q4 2025.

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 498.7% since May 2014, beating its benchmark by 303 percentage points (see more details here).

12. Arm Holdings plc (NASDAQ:ARM)

Number of Hedge Fund Holders: 33

Arm Holdings has drawn renewed interest from KeyBanc as the firm sees robust AI and data center demand accelerating licensing growth. The stock is twelfth on our list of 12 AI Stocks Wall Street Is Watching Now.

On May 7, KeyBanc analyst John Vinh raised the price target on Arm Holdings to $300 from $170 and maintained an Overweight rating. The company reported results for the fourth quarter and fiscal year ended 2026, having a record quarterly revenue of $1.49 billion driven by robust demand for cloud AI solutions.

Despite FQ4 revenue and EPS exceeding expectations, Keybanc noted mixed results for the semiconductor company. Licensing revenue beat forecasts, a big portion of Arm’s revenue. The company licenses its technology to companies such as Nvidia and Apple, collecting royalty payments on design use.

However, it missed on royalty revenue due to a contraction in smartphone Total Addressable Market. This was mainly due to memory shortages and higher prices. KeyBanc noted ARM guiding 20% year-over-year royalty growth in the fiscal first quarter. This growth is driven by the migration to Armv9, CSS, and Data Center, noted the firm, which doubled in revenues again.

ARM also indicated it sees $2B in demand for its AGI CPU in FY28, vs. its $1B outlook, but is supply constrained currently and unable to meet demand. Despite mixed results, we raise ests and our PT to $300 due to licensing upside DC drivers.

Arm Holdings plc (NASDAQ:ARM) is a semiconductor and software design company that designs and licenses semiconductor technology and related products.

11. Snap Inc (NYSE:SNAP)

Number of Hedge Fund Holders: 52

Another one of the AI Stocks Wall Street Is Watching Now is Snap Inc., with analysts looking at its AI infrastructure plans, improving growth metrics, and robust momentum in direct sales.

On May 7, Bernstein SocGen Group analyst Mark Shmulik reiterated a Market Perform rating and $7.00 price target on the stock. According to the firm, Snap is facing some complex challenges despite improvements in some of its key metrics.

If you want attention in this tape, announcing an Allbirds-like AI transformation might do the trick. As it stands, the self-described “crucible moment” for Snapchat remains incredibly complex.

While Snap may be trying to reframe its story around AI, the firm believes that its current position remains rather complicated because of metrics such as US and EU DAUs, ad revenues, and GAAP profitability, which continue to lag.

This is despite other metrics, such as revenue, global users, and FCF growth, having improved for the company.

The strongest part of Snapchat’s business appears to be its ability to grow direct sales, noted the firm, which now account for almost 20% of revenues. Even though this isn’t the primary business it wanted, Bernstein believes that it may be the business it is best suited to deliver.

Snap Inc (NYSE:SNAP), based in California, is a technology and social media company founded in 2011.

10. Hut 8 Corp. (NASDAQ:HUT)

Number of Hedge Fund Holders: 64

For Hut 8, the recent event in focus is its 15-year $9.8 billion AI data center lease at Beacon Point with 352MW capacity. The stock ranks tenth on our list of 12 AI Stocks Wall Street Is Watching Now.

Following the event, on May 6, Piper Sandler analyst Patrick Moley raised the price target on the stock to $127 from $93 and reiterated its Overweight rating.

The company announced on Wednesday that it had signed a 15-year lease for 352 MW of IT capacity at its Beacon Point AI data center campus in Nueces County, Texas. This deal brings Hut 8’s total contracted AI data center capacity to 597 MW across two campuses.

Piper Sandler believes that this deal is proof that Hut’s data center development model is repeatable. The quarter call was also centered around this very deal, which has been struck with an unnamed AI/HPC tenant.

The firm noted that management has confirmed this tenant isn’t Anthropic, Google, or FluidStack, which demonstrates that Hut has secured net new demand and that its development program isn’t reliant on any single tenant, chip architecture, or energy market.

Bottom line, HUT now has contracted 597 MW of IT capacity at ~$1.1B in average NOI/yr across 2 campuses (River Bend + Beacon Point) and still has ~1 GW of sites under joint diligence with Anthropic. The company remains undervalued based on our SOTP valuation of HUT’s power pipeline, ABTC ownership, and balance sheet. Raising PT to $127 from $93 on updated SOTP analysis. Reiterate OW.

Hut 8 Corp. (NASDAQ:HUT), together with its subsidiaries, operates as an energy infrastructure platform. It has also strategically pivoted towards AI data centers and substantial lease agreements.

9. Datadog, Inc. (NASDAQ:DDOG)

Number of Hedge Fund Holders: 75

Datadog’s leadership position is seen to be strengthening as analyst firms point to accelerating growth and AI-driven deal momentum post earnings. This has earned it a place on our list of 12 AI Stocks Wall Street Is Watching Now.

On May 8, DA Davidson analyst Gil Luria reiterated a Buy rating on the stock with a $125.00 price target.

Starting with a strong start to 2025, Datadog has had experienced consistent growth as AI native customers drove consistent usage in the quarter. This growth outlook has been improving with the company continuing to invest heavily in product investments where it sees traction.

That said, the firm sees its view unchanged after results. Quarterly revenue for the company topped $1 billion dollars for the first time, along with new contract wins with two major hyperscaler customers for training in their superintelligence labs.

We continue to highlight DDOG as a top pick. We reiterate our BUY rating and price target of $125.

Datadog, Inc. (NASDAQ:DDOG) offers a cloud-based SaaS platform for monitoring and analytics, specializing in cloud computing and AI-powered cybersecurity products.

8. Palantir Technologies Inc. (NASDAQ:PLTR)

Number of Hedge Fund Holders: 89

Another AI stock whose momentum continues to strengthen its bull case is Palantir, ranking eighth on our list of 12 AI Stocks Wall Street Is Watching Now. On May 5, Rosenblatt analyst John McPeake raised the price target on the stock to $225 from $200 and reiterated a Buy rating.

Palantir recently reported its Q1 2026 earnings report, a “significant beat” to estimates and demonstrating faster revenue growth. It also guided for the second quarter and full year 2026 above the Street.

The firm particularly noted that Palantir’s commercial business beat Street forecasts, even after one customer was recategorized to government in the quarter. What was particularly impressive was the company’s full-year revenue outlook, particularly because even the low end of the company’s guidance was above the highest estimates on Wall Street.

Rosenblatt noted how Palantir has been proving how AI has been helping enterprises and governments use AI to drive value, and that this has also been showing up in the numbers. The firm highlighted three factors unlocking AI value in the enterprise, notably its integration, orchestration, and Ontology.

That said, it is highly unlikely that Palantir’s platform advantage will be easy to replicate for competitors.

Our checks with customers, former Palantirians, and SI’s, as well as our knowledge of the product, make us doubt that an LLM provider is going to create a functioning replacement of the Palantir stack over the forecastable time horizon. We are raising our forecasts and target and reiterating our Buy rating on PLTR.

Palantir Technologies Inc. (NASDAQ:PLTR) is a leading provider of artificial intelligence systems.

7. Arista Networks Inc (NYSE:ANET)

Number of Hedge Fund Holders: 91

Arista Networks Inc (NYSE:ANET) is one of the 12 AI Stocks Wall Street Is Watching Now. The key takeaway for Arista Networks recently is “continue to accumulate here.” Piper Sandler sees AI-driven demand for the stock and that too, despite having near-term concerns centered on growth and increased de-commitments.

On May 6,  analyst James Fish raised the price target on the stock to $181 from $175 and maintained an “Overweight” rating.

Shares are lower following a 35% run over the last month, with early concerns post-print around ‘peak-growth’ and “increased de-commitments” commentary constraining growth.

Investors, the firm noted, have been concerned about peak growth and increased de-commitments, which suggests how some customers may be reducing or even delaying prior commitments. However, this weakness isn’t reason enough to avoid the stock.

Piper Sandler noted how Arista’s business is demonstrating acceleration on the back of AI exposure. ANET, it noted, is well-exposed for inference-based use cases provided that it counts hyperscalers, AI Titans, neoclouds, Edge Platforms, and large enterprises as customers.

What’s been working in this market is acceleration due to AI, and Arista is no exception to that, as the strong growth should persist through this year given underlying demand & visibility (and despite competitive concerns). Continue to accumulate here.

Arista Networks Inc (NYSE:ANET) develops, markets, and sells cloud networking solutions.

6. ServiceNow, Inc. (NYSE:NOW)

Number of Hedge Fund Holders: 118

ServiceNow’s long term story is gaining more weight, landing it sixth place on our list of AI Stocks Wall Street Is Watching Now. On May 5, Evercore ISI analyst Kirk Materne raised the price target on the stock to $150.00 (from $140.00) while maintaining an “Outperform” rating.

The firm particularly pointed to a $30 billion plus revenue vision for ServiceNow, along with a more robust FCF and EPS compounding potential. It believes that even with slightly lower margin assumptions, the company has the potential to generate around $12-13 in free cash flow per share and about $7.50 in GAAP EPS by FY2030.

Using our previous framework, this infers a present value of ~$150/share, and in our view, illustrates the base upside case when thinking out to 2H. Clearly, executing against this vision will be key, but in our view, FAD sets the table for a rethinking of NOW’s upside case going forward.

ServiceNow, Inc. (NYSE:NOW) provides a platform that integrates workflows, data, and AI to coordinate how work flows across large organizations.

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