US President Donald Trump announced a 25% tariff on Wednesday on select artificial intelligence chips, according to a report from Reuters. These tariffs on AI chips, including Nvidia’s H200 AI processor and AMD’s MI325X, have been issued under a new national security order released by the White House.
The proclamation stems from a nine-month investigation under Section 232 of the Trade Expansion Act of 1962. It is applicable on advanced semiconductors meeting certain performance benchmarks and devices containing them for import duties.
The move comes as part of a broader push to boost US chip production and reduce reliance on overseas manufacturers such as Taiwan.
“The United States currently fully manufactures only approximately 10 percent of the chips it requires, making it heavily reliant on foreign supply chains,” the proclamation said, highlighting how the reliance was a “significant economic and national security risk.”
In a fact sheet, The White House noted that the tariffs will be narrowly focused and won’t apply to chips and derivative devices imported for U.S. data centers.
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 Q3 2025.
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12. Penguin Solutions, Inc. (NASDAQ:PENG)
Number of Hedge Fund Holders: 29
Penguin Solutions, Inc. (NASDAQ:PENG) is one of the 12 Hot AI Stocks to Keep on Your Radar. On January 13, Citizens analyst Rustam Kanga reiterated a Market Outperform rating on the stock with a $26.00 price target.
The rating affirmation follows firm’s meeting with company executives at the 2026 Consumer Electronics Show (CES) in Las Vegas. Firm analyst met with Penguin Solutions CEO Mark Adams and CFO Nate Olmstead at the Bellagio hotel during the technology industry event. The meeting focused on Penguin Solution’s enterprise and sovereign AI opportunities.
The firm highlighted how PENG stock has declined an estimated 0.9% year-to-date, underperforming the Russell 3000 index. Despite the recent underperformance, the firm anticipates PENG to outperform the broader market. The firm’s price target is a reflection of PENG stock’s valuation, with a particular focus on its exposure to artificial intelligence.
Penguin Solutions, Inc. (NASDAQ:PENG) is a leading AI and HPC computing company engaged in the design and development of enterprise solutions worldwide.
11. HP Inc. (NYSE:HPQ)
Number of Hedge Fund Holders: 42
HP Inc. (NYSE:HPQ) is one of the 12 Hot AI Stocks to Keep on Your Radar. On January 13, Goldman Sachs analyst Katherine Murphy assumed coverage on the stock with a Sell rating and a price target of $21.00. Firm analysts see secular PC margin pressures on HPQ, expecting downside to 2026/2027 estimates despite robust shareholder returns.
The analyst told investors in a research note how following a stronger-than-expected FY25 and potential demand impacts from higher pricing, it seems that consensus expectations for Personal Systems growth in FY26 may be too high.
The firm continues to like HPQ’s sector-leading shareholder returns profile, believing HPQ is the most exposed to secular pressures on PC margins and demand.
“While we continue to like HPQ’s sector-leading shareholder returns profile (target 100% of FCF returned to shareholders) and believe the company will be able to defend its strong market share positions in PCs and Print, HPQ is the most exposed name in our coverage to secular pressures on PC margins and demand, and as such, we see downside to consensus sales and earnings estimates in F2026/27.”
HP Inc. (NYSE:HPQ) is a technology company that specializes in personal computing and printing solutions.
10. Oklo Inc. (NYSE:OKLO)
Number of Hedge Fund Holders: 38
Oklo Inc. (NYSE:OKLO) is one of the 12 Hot AI Stocks to Keep on Your Radar. On January 12, UBS analyst Jon Windham reiterated a Neutral rating on the stock with a $95.00 price target. Firm analysts believe that Oklo’s recent deal with Meta provides strategic value, but it remains cautious for now due to early-stage execution risks and long-development timeline.
Oklo recently struck a clean energy agreement with Meta that the company said “advances” its development of a 1.2 gigawatt campus in Pike County, Ohio. Firm analysts believe that the agreement is positive for Oklo as it financially supports the development of its early-stage advanced reactor projects.
They further highlighted how Meta has agreed to prepay for power and offer funding to support project development. The first phase of this is anticipated to reach commercial operation in 2030.
It is also expected that Oklo’s Aurora-INL project will deliver important initial construction cost data in 2026.
“The agreement further underscores the scarcity of available clean energy supply to meet growing tech company electricity demand, in our view. We expect Oklo’s Aurora-INL project to provide significant initial construction cost data for Oklo’s reactors in 2026.”
Oklo Inc. (NYSE:OKLO) develops advanced nuclear power plants that recycle nuclear waste to provide clean, reliable energy, supporting sustainable solutions for the increasing power demands of AI.
9. Hewlett Packard Enterprise Company (NYSE:HPE)
Number of Hedge Fund Holders: 72
Hewlett-Packard Enterprise Company (NYSE:HPE) is one of the 12 Hot AI Stocks to Keep on Your Radar. On January 13, Goldman Sachs analyst Katherine Murphy assumed coverage on the stock to Buy from Neutral with a price target of $31.
The rating coverage follows HPE’s acquisition of Juniper in July 2025, which the firm believes has “meaningfully shifted its business mix towards the higher-margin, faster-growing Networking segment.”
Owing to concerns about HPE’s legacy IT hardware business, limited AI infrastructure participation, and integration risks related to the Juniper acquisition, the firm further noted how HPE’s current multiple remains discounted as compared to peers.
Overall, even though HPE is going to be a “show-me story in 2026,” the merger with Juniper reinforces the company’s position as the number two player in the enterprise/campus networking market; expanding its reach in data center networking.
Hewlett Packard Enterprise Company (NYSE:HPE), an American multinational technology company, provides high-performance computing systems, AI software, and data storage solutions for running complex AI workloads.
8. Reddit, Inc. (NYSE:RDDT)
Number of Hedge Fund Holders: 80
Reddit, Inc. (NYSE:RDDT) is one of the 12 Hot AI Stocks to Keep on Your Radar. On January 12, Evercore ISI analyst Mark Mahaney initiated coverage on the stock with an Outperform rating and a price target of $320. Firm analysts believe RDDT has more room to turn its user engagement into revenue.
Analysts anticipate a three-year revenue compound annual growth rate of 30%-40%, driven by Reddit’s development of new features and more advanced ad products. This positions the company among the strongest growth profiles in the sector.
“Our Stock Call: We are initiating coverage of Reddit (RDDT) with an Outperform rating & a $320 price target (30% upside), based on 35x ’27E EBITDA of $1.8B. We view valuation (39x ’26 EBITDA) as very robust but reasonable, given our outlook for a 3-year Revenue CAGR of 30–40% & EBITDA CAGR of 40–50%, one of the strongest growth profiles in our sector. We see upside to Street ests — we are 4% above Street in ’27 on Revenue & EBITDA.”
RDDT has already been performing well, noted the analysts, but there is still significant opportunity for it to ramp up its average revenue per user. Factors such as industry comps, recent product launches, and feedback from ad checks are likely to lead to such a ramp.
Reddit, Inc. (NYSE:RDDT) is a social media platform that leverages AI to strengthen search functionality and improve user engagement.
7. ASML Holding N.V. (NASDAQ:ASML)
Number of Hedge Fund Holders: 82
ASML Holding N.V. (NASDAQ:ASML) is one of the 12 Hot AI Stocks to Keep on Your Radar. On January 13, Rothschild Redburn analyst Timm Schulze-Melander raised the price target on the stock to EUR1, 250.00 (from EUR1, 200.00) while maintaining a Buy rating.
The research firm lifted its Q4 2025 order intake forecast for ASML to €7,047 million, roughly 13% above the consensus estimate of €6,249 million. This marks the final quarter ASML reports its order intake on a quarterly basis.
The firm anticipates that TSMC’s Technology Symposium in April 2026 will be the next significant catalyst for its high NA EUV investment thesis, expecting the company to provide an update on its roadmap that potentially moves up implementation from 2030 to 2028. This would put it in more direct competition with Intel Foundry.
Back in July 2025, the firm had warned that strong semiconductor sales wouldn’t immediately translate into capital equipment demand; forecasting a second-half plateau as utilization improved. The firm now believes that utilization has improved enough for demand to turn positive, with momentum building through 2028.
ASML Holding N.V. (NASDAQ:ASML) develops and sells advanced semiconductor equipment, including lithography, metrology, and inspection systems for chip manufacturing.
6. Autodesk, Inc. (NASDAQ:ADSK)
Number of Hedge Fund Holders: 83
Autodesk, Inc. (NASDAQ:ADSK) is one of the 12 Hot AI Stocks to Keep on Your Radar. On January 13, Piper Sandler analyst Clarke Jeffries reiterated an Overweight rating on the stock with a $373.00 price target. The firm has deemed Autodesk as one of its “Top Picks for 2026” in their recent analyst note.
According to the firm, Autodesk has made considerable progress in implementing Generative AI solutions for architecture, engineering, construction, and manufacturing industries. The company has made remarkable strides in a span of few years in operationalizing AI technologies. This transition marks a meaningful monetization change in industries that have been long dependent on seat-based, file-format desktop tools.
The firm remarked how Autodesk’s has made “durable double-digit underlying growth with even some modest acceleration in 2025” even though it faced challenging macroeconomic conditions. Its growth trajectory is therefore a reflection of a robust stock as compared to what it was a few years ago.
Autodesk, Inc. (NASDAQ:ADSK), a multinational software corporation, leverages generative AI technology to drive innovation across the design, construction, manufacturing, and entertainment industries.
5. Amphenol Corporation (NYSE:APH)
Number of Hedge Fund Holders: 89
Amphenol Corporation (NYSE:APH) is one of the 12 Hot AI Stocks to Keep on Your Radar. On January 13, Truist Securities analyst William S. Stein raised the price target on the stock to $182 from $180 and kept a “Buy” rating on the shares. The rating follows closure of Amphenol’s acquisition of CommScope’s Connectivity and Cable Solutions business.
Amphenol recently announced that it has completed its previously announced acquisition of CommScope’s Connectivity and Cable Solutions (CCS) business, adding significant fiber optic interconnect capabilities for the IT datacom and communications networks markets and a range of industrial interconnect products for the building infrastructure connectivity market.
As per Truist’s research estimates, this $10.5 billion acquisition, Amphenol’s largest ever, is anticipated to expand Amphenol’s sales by an estimated 17%. Amphenol’s boasts an “excellent” track record with acquisitions, noted the analysts, highlighting how such deals not only help expand sales but also operating profit margins and return on invested capital.
Truist’s updated model reflects an estimated 4% earnings per share accretion in 2026, with anticipated longer-term accretion of about 16% within two years. The firm has also raised its 2027 earnings per share estimate for APH to $4.71 from $4.33.
Amphenol Corporation (NYSE:APH) designs, manufactures, and markets electrical, electronic, and fiber optic connectors.
4. Apple Inc. (NASDAQ:AAPL)
Number of Hedge Fund Holders: 166
Apple Inc. (NASDAQ:AAPL) is one of the 12 Hot AI Stocks to Keep on Your Radar. On January 12, Evercore ISI analyst Amit Daryanani reiterated an Outperform rating on the stock with a $330.00 price target. Firm analysts highlight Apple’s new AI partnership with Google Gemini, citing monetization upside and custom AI experiences ahead.
The firm noted how Apple has confirmed entering into a multi-year agreement with Google for its next generation of AI models, a move that will help power the long-awaited Siri 2.0 upgrade.
A joint statement has revealed that Apple’s foundation models and cloud technology will be based on Google’s Gemini models. These models have received positive feedback since Gemini 3.0 launched last year. The firm anticipates the upgrade to be announced in coming months.
“In addition, the statement noted: ‘After careful evaluation, Apple determined Google’s AI technology provides the most capable foundation for Apple Foundation Models.’ The statement did not include a price tag, but prior reports indicated that Apple would be paying ~$1B a year to license the ~1.2T parameter model. “
Evercore ISI believes that this Apple-Google partnership offers the best of both worlds for Apple, allowing it to upgrade its current model stack and paving way for potential monetization. Following this AI partnership announcement, investors should brace themselves for an Apple Intelligence 2.0 announcement coupled with a more custom and personal Siri experience in the upcoming months.
Apple is a technology company known for its consumer electronics, software, and services.
3. Alphabet Inc. (NASDAQ:GOOGL)
Number of Hedge Fund Holders: 219
Alphabet Inc. (NASDAQ:GOOGL) is one of the 12 Hot AI Stocks to Keep on Your Radar. On January 13, Truist Securities analyst Youssef Squali reiterated a Buy rating on the stock with a $350.00 price target. The rating affirmation comes ahead of the tech giant’s fourth-quarter earnings report scheduled for February 4.
Despite an increase in generative AI competitors, firm analysts expect Alphabet to demonstrate robust search momentum. They project 15%+ top-line growth, aligning with consensus estimates. Both query volume and cost-per-click metrics have led to robust search spending.
The tech giant is expected to deliver robust fourth-quarter results, driven by robust engagement and advertising demand, which translates into mid-teens growth across Search and YouTube. Meanwhile, solid Cloud backlog is likely to generate 34% revenue growth in that segment.
The firm cited the November rollout of Gemini 3 as another catalyst for Alphabet, positioning the company at the forefront of AI performance. Recent data also suggests continued gains in Search market share.
Overall, Truist remains bullish on Alphabet’s competitive moat despite increasing competition in the generative AI space.
Alphabet Inc. (NASDAQ:GOOGL) is an American multinational technology conglomerate holding company wholly owning the internet giant Google, amongst other businesses.
2. NVIDIA Corporation (NASDAQ:NVDA)
Number of Hedge Fund Holders: 234
NVIDIA Corporation (NASDAQ:NVDA) is one of the 12 Hot AI Stocks to Keep on Your Radar. On January 13, Wolfe reiterated the stock as “Outperform,” noting that the idea is its favorite for 2026. Analyst Chris Caso noted that the AI chip maker is being added to the Wolfe Alpha List, replacing Micron. This is despite the stock being “up ‘only’ 36% over the past year,” which Wolfe said trails other AI-linked names.
“NVDA is up ‘only’ 36% over the past year, underperforming other AI related names. We think the reason for underperformance is threefold — the late launch of Blackwell, concerns about the sustainability of AI spending in general, as well as concerns about share losses to custom AI solutions.”
However, with Nvidia’s product roadmap advancing, these worries are now fading.
“Blackwell is now ramping fully, and Rubin is on time for 2H26 ramp,” Wolfe wrote, adding that Rubin offers “5x inference improvement vs. Blackwell.”
The stock’s recent outlook points to “at least $40bn upside to CY26 consensus revenue,” with resumed H200 shipments to China potentially leading to further upside.
NVIDIA Corporation (NASDAQ:NVDA) specializes in AI-driven solutions, offering platforms for data centers, self-driving cars, robotics, and cloud services.
1. Meta Platforms, Inc. (NASDAQ:META)
Number of Hedge Fund Investors: 273
Meta Platforms, Inc. (NASDAQ:META) is one of the 12 Hot AI Stocks to Keep on Your Radar. On January 12, Piper Sandler analyst Thomas Champion weighed in on the internet stocks ahead of 1Q results. The firm names META as its top large-cap pick for 2026, maintaining its Overweight rating on the tech giant.
Analyst Thomas Champion highlighted robust channel checks for Meta, pointing to first-quarter revenue guidance of up to $53 billion at the high end, which implies about 25% year-over-year growth.
On the same day, Wells Fargo reiterated META as “Overweight” and lowered its price target to $795 per share from $802.
“Expect 4Q earnings and ’26 outlook to solidify confidence in $31-$32 EPS for 2026. Street CapEx likely moves higher, again.”
Analysts on Wall Street currently have a consensus Buy rating on the stock. The average price target of $825 implies a 32.76% upside, however, the Street-high target of $1,117 implies an upside of 79.75%.
While we acknowledge the potential of META 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 META and that has 100x upside potential, check out our report about this cheapest AI stock.
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