On December 24, Kevin Simpson of Capital Wealth Planning joined ‘Closing Bell’ on CNBC to talk about AI tailwinds and the diverging tech picture. Given the current market dynamics, Simpson confirmed that he is bullish and remarked that it is difficult not to be optimistic after such a substantive start to the show. Looking ahead to next year, Simpson explored whether the market can move higher even if two major headwinds, the AI trade (where a rising tide lifts all tech stocks) and a dovish Fed, are removed. He concluded that as long as economic growth holds up and earnings remain solid, the market can still experience a successful year characterized by increased breadth. The dialogue sharpened on the specific nature of the AI trade, and Simpson stated that he does not expect to lose the AI trade entirely, but rather the all-in AI trade, where every tech stock rises indiscriminately. He illustrated the shift toward a stock picker’s market and emphasized that a broadening market does not mean abandoning technology for a pure value play. Instead, it requires being more selective across the board in 2026.

Despite the expectation that earnings expectations for sectors outside of tech are currently elevated, Simpson maintained that while he wants other sectors to rise, the strongest growth will likely stay in tech. He observed that while trades like the equal-weighted S&P 500 versus the standard S&P 500 occasionally outperform, investors frequently abandon those paths to return to the mega-cap tech names. Simpson asserted that investors will always pay a premium for innovation within the AI landscape, but he expects sectors like financials, industrials, consumer discretionary, and materials to assist with the heavy lifting in the coming year.

That being said, we’re here with a list of the 12 best emerging technology stocks to invest in.

Our Methodology

We sifted through financial media reports and ETFs tracking next generation tech stocks. We then selected 12 stocks that were the most popular among elite hedge funds and that analysts were bullish on. The stocks are ranked in ascending order of the number of hedge funds that have stakes in them, as of Q3 2025. The hedge fund data was sourced from Insider Monkey’s database.

Note: All data was sourced on December 24. 

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).

12 Best Emerging Technology Stocks to Invest In

12. Navitas Semiconductor Corporation (NASDAQ:NVTS)

Number of Hedge Fund Holders: 11

Navitas Semiconductor Corporation (NASDAQ:NVTS) is one of the best emerging technology stocks to invest in. On December 11, Navitas Semiconductor announced a significant expansion of its partnership with Avnet (NASDAQ:AVT). The agreement elevates Avnet to a globally franchised distribution partner, building upon the successful existing relationship between Navitas and Avnet Silica in Europe. The move is part of a broader strategy by Navitas to consolidate its franchised distribution network and strengthen its global channel presence.

As one of the world’s largest electronic component distributors, Avnet will now provide worldwide technical and commercial expertise for Navitas’ advanced GaNFast/GaN and GeneSiC/SiC portfolios. These wide bandgap semiconductor devices are designed for high-voltage and high-power applications. By aligning with Avnet’s global framework, Navitas aims to provide customers with faster, more reliable product access and consistent technical support across all geographic regions.

The partnership is targeted at high-growth, high-power sectors that demand energy-efficient solutions. These include AI data centers, high-performance computing, renewable energy, grid infrastructure, and industrial electrification. According to leadership from both companies, the expansion utilizes Avnet’s engineering depth to accelerate the worldwide adoption of Navitas’ GaN and SiC platforms as industries transition toward more advanced power designs.

Navitas Semiconductor Corporation (NASDAQ:NVTS) designs, develops, and markets power semiconductors in the US, Europe, China, the rest of Asia, and internationally.

11. Redwire Corporation (NYSE:RDW)

Number of Hedge Fund Holders: 15

Redwire Corporation (NYSE:RDW) is one of the best emerging technology stocks to invest in. On December 19, KeyBanc initiated coverage of Redwire with a Sector Weight rating but set no price target on the shares. The firm believes that following the company’s acquisition of Edge Autonomy, Redwire is transforming into a multi-domain space and defense firm. However, while this expansion significantly increases the company’s scale, it comes at the expense of shareholder dilution.

In other news, on December 18, Redwire Corporation and The Exploration Company announced an eight-figure contract for Redwire to supply critical docking hardware for TEC’s flagship spacecraft, Nyx. Based in Kruibeke, Belgium, and Munich, Germany, the two firms have agreed that Redwire will provide two International Berthing and Docking Mechanisms/IBDM. These systems are fully compliant with the International Docking System Standard/IDSS, ensuring that Nyx (a reusable and refuelable European spacecraft) can perform autonomous rendezvous and docking with a variety of standardized space infrastructure.

The IBDM technology was developed in Belgium in collaboration with international partners and the European Space Agency. It features a modular, standardized architecture that supports both berthing and autonomous docking. Redwire’s offices in Belgium and Poland are currently using their experience from developing a similar IBDM for the Lunar Gateway’s International Habitat, a project that provides a high level of technical maturity and mission confidence for the Nyx program. The partnership is viewed as a move toward strengthening Europe’s autonomous access to space and its commercial space sector.

Redwire Corporation (NYSE:RDW) provides critical space solutions and space infrastructure for government and commercial customers in the US, Europe, and internationally.