On October 22, Vios Advisors’ Michael Bapis and BNY’s Alicia Levine joined CNBC’s ‘Closing Bell’ to discuss the latest news affecting markets. Levine mentioned the recent ‘vol’ scare briefly shaved 3% off the top of the market but ultimately proved that corporates are resilient. She also mentioned that the tariff conversation was quickly absorbed by the markets. Talking about what advice was being given to clients, Bapis described the current situation as a huge juggling act for the markets. He pointed out the skepticism surrounding the incoming CPI numbers due to the government shutdown, contrasted with the strong and resilient earnings reported by many companies. For clients, the advice is to maintain a balanced portfolio where alternatives are very important. Bapis also emphasized that the AI phenomenon is not being discussed enough, calling it the potential global revolution on the level of infrastructure advancements like railroads, and asserting that this technological step is only in its first or second inning.

The combination of strong earnings, a resilient economy, and rate cuts makes it hard to bet against the market, even with concerns around the edges. Levine believes that the presence of these concerns is viewed as healthy, suggesting a desirable two-way conversation in the market rather than a straight rocket ship up. The previous 3% pullback ten days prior provided this necessary conversation. It was agreed that if earnings continue to exceed expectations and the AI trade remains intact, the market will see its next leg higher. Technically, however, the S&P 500 needs to decisively pass the 6,800 level to convince analysts of this next leg, though Levine believes it will reach that point fundamentally. Bapis also pointed out that the fact that the dual challenges to the bull case only resulted in a 3% pullback meant the market did not get the necessary reset lower. The necessary reset may instead have to occur sector by sector, evidenced by some speculative stocks moving down on the day.

That being said, we’re here with a list of the 12 hot stocks to buy with huge upside potential.

Our Methodology

We sifted through different stock screeners to compile a list of hot stocks with the highest performance over the past 3 months (over 100%) and with high upside potential (over 55%). We then selected the 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 Q2 2025.

Note: All data was sourced on October 22. 

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 Hot Stocks to Buy with Huge Upside Potential

12. Mobilicom Limited (NASDAQ:MOB)

3-Month Performance as of October 22: 100.54%

Number of Hedge Fund Holders: 3

Average Upside Potential as of October 22: 55.83%

Mobilicom Limited (NASDAQ:MOB) is one of the hot stocks to buy with huge upside potential. On October 20, ThinkEquity analyst Ashok Kumar raised the firm’s price target on Mobilicom to $12 from $5 and kept a Buy rating on the shares. This sentiment came out as the firm noted that the company is transitioning to a more profitable and scalable business model around its OS3 cybersecurity platform for AI-powered drones.

ThinkEquity believes that the defense market’s rapid pivot to unmanned systems in the middle of geopolitical and policy tailwinds will drive a revenue inflection for Mobilicom.

Mobilicom Limited (NASDAQ:MOB) provides hardware products and software and cybersecurity solutions for drones, small-sized unmanned aerial vehicles/SUAV, and robotics in Israel, the US, Canada, and internationally.

11. Nektar Therapeutics (NASDAQ:NKTR)

3-Month Performance as of October 22: 151.34%

Number of Hedge Fund Holders: 18

Average Upside Potential as of October 22: 61.86%

Nektar Therapeutics (NASDAQ:NKTR) is one of the hot stocks to buy with huge upside potential. On October 22, Nektar Therapeutics announced that new data from the ongoing REZOLVE-AD Phase 2b study of rezpegaldesleukin was accepted for a late-breaking oral abstract presentation. Rezpegaldesleukin is an IL-2 pathway agonist and regulatory T-cell/Treg proliferator being investigated for the treatment of atopic dermatitis.

The REZOLVE-AD Phase 2b study enrolled 393 patients with moderate-to-severe AD who had no prior treatment with biologic or JAK inhibitor therapies. Patients were enrolled across ~110 sites globally. The study’s primary endpoint is the mean improvement in EASI score at the end of the 16-week induction period.

Rezpegaldesleukin is a potential first-in-class resolution therapeutic wholly owned by Nektar Therapeutics, which is focused on addressing the underlying immunological dysfunction in autoimmune and chronic inflammatory diseases. The drug is a novel, first-in-class regulatory T cell stimulator being developed as a self-administered injection for multiple autoimmune and inflammatory conditions, including atopic dermatitis, which affects ~30 million people in the US.

Nektar Therapeutics (NASDAQ:NKTR) is a biopharmaceutical company that discovers and develops therapies that selectively modulate the immune system to treat autoimmune disorders in the US and internationally.

10. HIVE Digital Technologies Ltd. (NASDAQ:HIVE)

3-Month Performance as of October 22: 110.21%

Number of Hedge Fund Holders: 5

Average Upside Potential as of October 22: 72.06%

HIVE Digital Technologies Ltd. (NASDAQ:HIVE) is one of the hot stocks to buy with huge upside potential. On October 22, B. Riley analyst Nick Giles raised the firm’s price target on Hive Digital to $8 from $7 and kept a Buy rating on the shares. This sentiment was announced as the firm updated its estimates and valuations for high-performance computing-focused companies, while also lifting price targets by an average of 78% and 2026 forecasts by 5%.

The firm pointed out that shares for the company have seen a sharp rise since the middle of 2025, although there were some recent declines as well. This growth is driven by the demand for power and data centers related to AI. B. Riley believes that the new agreements, like the reported cloud partnership between Google and Anthropic, could provide even more upward momentum for the stock.

HIVE Digital Technologies Ltd. (NASDAQ:HIVE) is a technology company that builds and operates data centers powered by green energy in Bermuda.

9. RAPT Therapeutics Inc. (NASDAQ:RAPT)

3-Month Performance as of October 22: 137.15%

Number of Hedge Fund Holders: 12

Average Upside Potential as of October 22: 93.33%

RAPT Therapeutics Inc. (NASDAQ:RAPT) is one of the hot stocks to buy with huge upside potential. On October 21, Wells Fargo raised the firm’s price target on Rapt Therapeutics to $48 from $38 and kept an Overweight rating on the shares. This announcement was made as the firm noted that data from its partner’s CSU (Chronic Spontaneous Urticaria) study suggests that the drug’s efficacy is either comparable to or numerically better than XOLAIR, even when dosed only every 12 weeks.

XOLAIR helps decrease symptoms and the frequency of asthma attacks, hives, nasal polyps, and allergic reactions to food. Rapt Therapeutics’ anti-IgE antibody therapy (RPT904) is similar to XOLAIR for multiple food allergies. Since the drug has the same epitope (the part of an antigen that the antibody binds to) as XOLAIR, Wells expects this strong efficacy to translate to Food Allergy. This represents a large market that could support blockbuster sales, even if the drug is priced competitively with a biosimilar.

RAPT Therapeutics Inc. (NASDAQ:RAPT) is a clinical-stage immunology-based biopharmaceutical company that discovers, develops, and commercializes oral small-molecule therapies for patients with unmet needs in oncology and inflammatory diseases in the US.

8. PepGen Inc. (NASDAQ:PEPG)

3-Month Performance as of October 22: 215.97%

Number of Hedge Fund Holders: 16

Average Upside Potential as of October 22: 97.80%

PepGen Inc. (NASDAQ:PEPG) is one of the hot stocks to buy with huge upside potential. On October 9, BofA raised the firm’s price target on PepGen to $3 from $1 and maintained an Underperform rating on the shares. This sentiment came out as the firm updated its financial model to assign a standalone value to the DM1 program following positive early Phase 1 data that showed splicing correction.

The DM1 program refers to the company’s investigational drug, PGN-EDODM1, for treating Myotonic Dystrophy Type 1/DM1 by using its proprietary Enhanced Delivery Oligonucleotide/EDO technology.  As of now, the firm needs more information regarding the translation of this splicing correction to a functional benefit and the degree of splicing correction observed after repeat dosing.

Bank of America also reminded investors that PepGen is behind its competitors in the development timeline, and it is still unclear if the company will be able to pursue an accelerated approval pathway.

PepGen Inc. (NASDAQ:PEPG) is a clinical-stage biotechnology company that develops oligonucleotide therapeutics for the treatment of severe neuromuscular and neurologic diseases in the US.

7. Precigen Inc. (NASDAQ:PGEN)

3-Month Performance as of October 22: 144.37%

Number of Hedge Fund Holders: 16

Average Upside Potential as of October 22: 111.00%

Precigen Inc. (NASDAQ:PGEN) is one of the hot stocks to buy with huge upside potential. On October 13, Precigen announced long-term follow-up data for PAPZIMEOS (zopapogene imadenovec-drba), which is an immunotherapy for the treatment of adults with recurrent respiratory papillomatosis/RRP. PAPZIMEOS received full approval from the US FDA in August this year, becoming the first and only approved therapy for adult RRP.

The FDA approval was supported by results from a pivotal study, which demonstrated that 51% of the 35 study patients achieved a complete response, defined as requiring no surgeries in the 12 months following treatment with PAPZIMEOS.

PAPZIMEOS (zopapogene imadenovec-drba) is the first and only approved therapy that addresses the root cause of RRP. It is a non-replicating adenoviral vector-based immunotherapy developed using Precigen’s proprietary AdenoVerse therapeutic platform. The drug is designed to express a fusion antigen composed of selected regions of human papillomavirus/HPV types 6 and 11 proteins, which are the causative agents of RRP, to generate an immune response against them.

Precigen Inc. (NASDAQ:PGEN) is a discovery and clinical-stage biopharmaceutical company that develops gene and cell therapies using precision technology to target diseases in areas of immuno-oncology, autoimmune disorders, and infectious diseases.

6. Lexeo Therapeutics Inc. (NASDAQ:LXEO)

3-Month Performance as of October 22: 151.50%

Number of Hedge Fund Holders: 15

Average Upside Potential as of October 22: 116.68%

Lexeo Therapeutics Inc. (NASDAQ:LXEO) is one of the hot stocks to buy with huge upside potential. On October 21, H.C. Wainwright lowered the firm’s price target on Lexeo Therapeutics to $13 from $15 and kept a Buy rating on the shares. The price cut was made as the firm pointed out the share dilution from the most recent equity raise.

Earlier on October 17, Leerink analyst Mani Foroohar also lowered the firm’s price target on Lexeo Therapeutics to $18 from $20 with an Outperform rating on the shares. Leerink noted the company’s announcement of a secondary offering and a concurrent private placement, which together are expected to generate gross proceeds of $135 million.

The financing was announced alongside additional data for the company’s compound, LX2020 PKP2. Leerink commented that strengthening the balance sheet before starting the pivotal trial for FACM and releasing further PKP2 data is a logical step. The firm believes that this action shifts the focus to Lexeo’s data, rather than concerns about the company’s financial overhang.

Lexeo Therapeutics Inc. (NASDAQ:LXEO) is a clinical-stage genetic medicine company that focuses on hereditary and acquired diseases with high unmet need in the US.

5. Evaxion (NASDAQ:EVAX)

3-Month Performance as of October 22: 100.74%

Number of Hedge Fund Holders: 1

Average Upside Potential as of October 22: 148.62%

Evaxion (NASDAQ:EVAX) is one of the hot stocks to buy with huge upside potential. On October 20, Lake Street analyst Thomas Flaten raised the firm’s price target on Evaxion Biotech to $11 from $6 and kept a Buy rating on the shares. This sentiment was announced after the company announced two-year Phase 2 data for its personalized cancer vaccine, EVX-01, in advanced melanoma.

EVX-01 is a personalized peptide-based cancer vaccine for first-line treatment of multiple advanced solid cancers and is Evaxion’s lead clinical asset. Flaten informed investors that the two-year data for EVX-01 and Merck & Co. Inc.’s (NYSE:MRK) option exercise for EVX-B3 both serve to further validate Evaxion’s platform.

Evaxion (NASDAQ:EVAX) is a clinical-stage biotech company that develops AI-powered immunology vaccines. It was formerly known as Evaxion Biotech and changed its name to Evaxion in May 2025.

Merck & Co. Inc. (NYSE:MRK) is a healthcare company that offers human health pharmaceuticals, veterinary pharmaceuticals, vaccines & health management solutions and services.

4. Ovid Therapeutics Inc. (NASDAQ:OVID)

3-Month Performance as of October 22: 132.32%

Number of Hedge Fund Holders: 15

Average Upside Potential as of October 22: 179.50%

Ovid Therapeutics Inc. (NASDAQ:OVID) is one of the hot stocks to buy with huge upside potential. On October 10, B. Riley raised the firm’s price target on Ovid Therapeutics to $5 from $3 and kept a Buy rating on the shares. This price target lift came as a result of strong Phase 1 biomarker results for OV329, as the analyst reported. The results showed superior efficacy compared to vigabatrin, notably without the associated ocular toxicity.

The favorable profile supports the use of OV329 in earlier lines of treatment and has the potential to expand its market to over $700 million. Furthermore, the company’s concurrent $175 million PIPE (Private Investment in Public Equity) financing strengthens the balance sheet and extends the cash runway into 2028.

Ovid Therapeutics Inc. (NASDAQ:OVID) is a biopharmaceutical company that develops impactful medicines for patients and families with epilepsies and seizure-related neurological disorders in the US.

3. 4D Molecular Therapeutics Inc.. (NASDAQ:FDMT)

3-Month Performance as of October 22: 128.20%

Number of Hedge Fund Holders: 19

Average Upside Potential as of October 22: 213.69%

4D Molecular Therapeutics Inc. (NASDAQ:FDMT) is one of the hot stocks to buy with huge upside potential. On October 13, 4D Molecular Therapeutics announced that the company secured up to $11 million in additional funding and technical support from the Cystic Fibrosis Foundation to accelerate the development of 4D-710, which is a genetic medicine for cystic fibrosis/CF lung disease.

The commitment was made following a review of the program and clinical data by the CF Foundation’s independent scientific advisors. This latest financial support includes an initial tranche of $7.5 million and closed in October 2025, bringing the CF Foundation’s total committed funding to 4DMT’s CF programs to ~$32 million to date.

The drug has received Rare Pediatric Disease Designation and Orphan Drug Designation from the FDA. CF is a progressive, inherited disease caused by variants in the CFTR gene. It primarily leads to lung disease, which is the leading cause of morbidity and mortality among CF patients, affecting ~40,000 people in the US and ~105,000 people globally. ~1,000 new cases are diagnosed annually in the US. The condition results in impaired lung function, inflammation, and chronic infections due to the inability to clear thickened mucus.

4D Molecular Therapeutics Inc.. (NASDAQ:FDMT) is a late-stage biotechnology company that develops adeno-associated virus vectors from its proprietary synthetic vector discovery platform, Therapeutic Vector Evolution, in the Netherlands and the US.

2. Rani Therapeutics Holdings Inc. (NASDAQ:RANI)

3-Month Performance as of October 22: 381.65%

Number of Hedge Fund Holders: 3

Average Upside Potential as of October 22: 293.37%

Rani Therapeutics Holdings Inc. (NASDAQ:RANI) is one of the hot stocks to buy with huge upside potential. On October 21, H.C. Wainwright analyst Brandon Folkes assumed coverage of Rani Therapeutics with a Buy rating and $11 price target. The firm believes that the company has 3 major value drivers: the platform technology RaniPill, a recent collaboration agreement with Chugai Pharmaceutical for a hemophilia product, and an additional five drug targets, as well as RT-114, which is an oral GLP-1/GLP-2 dual agonist candidate.

H.C. Wainwright expects data readouts on RT-114 to be the biggest driver of near-term value creation for the company’s shares. A day prior, on October 20, Maxim raised the firm’s price target on Rani Therapeutics to $10 from $5 with a Buy rating on the shares after the company announced the licensing deal with Chugai Pharmaceutical and a concurrent private placement to raise $60 million in proceeds.

Rani Therapeutics Holdings Inc. (NASDAQ:RANI) is a clinical-stage biotherapeutics company that focuses on technologies to enable the administration of biologics and drugs orally for patients, physicians, and healthcare systems with an alternative to painful injections in the US.

1. Omeros Corporation (NASDAQ:OMER)

3-Month Performance as of October 22: 115.60%

Number of Hedge Fund Holders: 13

Average Upside Potential as of October 22: 365.12%

Omeros Corporation (NASDAQ:OMER) is one of the hot stocks to buy with huge upside potential. On October 15, H.C. Wainwright raised the firm’s price target on Omeros to $20 from $9 and kept a Buy rating on the shares. This sentiment followed the company’s announcement of an asset purchase and license agreement with Novo Nordisk (NYSE:NVO) for zaltenibart.

Omeros is set to receive an upfront cash payment of $240 million, with the potential for an additional $510 million in one-time payments tied to development and approval milestones. Furthermore, the agreement includes up to $1.3 billion in one-time, sales-based milestone payments, along with tiered royalties on the products’ annual net sales.

Novo Nordisk (NYSE:NVO), together with its subsidiaries, engages in the research and development, manufacture, and distribution of pharmaceutical products internationally. It has two segments: Diabetes & Obesity Care and Rare Disease.

Omeros Corporation (NASDAQ:OMER) is a clinical-stage biopharmaceutical company that discovers, develops, and commercializes small-molecule and protein therapeutics, and orphan indications targeting immunologic diseases.

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