On April 25, Kari Firestone, Aureus Asset Management executive chairman and co-founder, joined CNBC’s ‘Squawk Box’ to discuss the latest market trends and express how this is a reasonable place for long-term investors to enter the market. Despite persistent concerns about a recession coming from tariffs, Firestone thinks that corporate earnings have generally exceeded expectations. The strong performance of major tech companies has been a key driver behind the market’s recent gains, such as those in the MAG7. Elaborating on the significance of these tech giants, Firestone also underscored that the top 2 companies in the S&P 500, regardless of which they are, match the market value of the bottom 300 companies in the index. This concentration means that these leading firms are fundamental to the US economy’s progress.
The conversation then addressed the impact of proposed FDA budget cuts on innovation for biotech companies. Firestone agreed that such cuts could slow down the approval process for new products and drug manufacturing, and she advised against reducing the FDA’s budget. However, she believes that the market has already priced in these risks. She compared the situation to previous market overreactions, such as the 32% drop during the early COVID-19 period, which was followed by a rapid recovery.
Firestone also concluded that the market is now fairly valued. Some sectors offer attractive opportunities due to recent price declines. She assessed the overall market valuation in light of tariff uncertainties and the recent rebound from a 20% drop to a current decline of about 10.5%. She explained that the market’s price-to-earnings multiple has decreased from 22.5x next year’s earnings to 18.5x, assuming no severe recession. She’s confident that the market is unlikely to end the year lower than current levels and recommends that long-term investors enter the market at this stage. Firestone believes that the market has partially priced in the impact of tariffs. She estimated that a 5% to 10% tariff is reflected in current prices. While a full-blown recession may not be entirely priced in, a slowdown likely is.
That being said, we’re here with a list of the 30 stocks that should double in 3 years.
A trader on the floor of the stock exchange, capturing the energy that powers the market.
Our Methodology
We sifted through financial media reports and Reddit threads to compile a list of the top 30 stocks that should double in 3 years. The stocks are ranked in ascending order of the number of hedge funds that have stakes in them, as of Q4 2024. The hedge fund data was sourced from Insider Monkey’s database which tracks the moves of over 1000 elite money managers.
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 373.4% since May 2014, beating its benchmark by 218 percentage points (see more details here).
30 Stocks That Should Double in 3 Years
30. Sezzle Inc. (NASDAQ:SEZL)
Number of Hedge Fund Holders: 19
Sezzle Inc. (NASDAQ:SEZL) is a technology-enabled payments company that offers solutions in-store and at online retail stores. It also provides the Sezzle Platform, which offers a payment solution for consumers that extends credit at the point-of-sale. This allows consumers to purchase and receive the ordered merchandise at the time of sale while paying in installments over time.
The company’s On-Demand product is an offering launched in Q4 2024 through a banking partnership with WebBank. This innovative Pay-in-4 solution distinguishes itself by allowing consumers to use Buy Now Pay Later capabilities virtually anywhere Visa is accepted. This convenience is even extended to customers without a Sezzle Premium or Anywhere subscription.
The performance of On-Demand is reflected in the surge of Monthly On-Demand & Subscriber Users, which reached 707,000 by the close of December 2024. This represents a 130% increase year-over-year and an addition of 178,000 users sequentially. Furthermore, Sezzle Inc. (NASDAQ:SEZL) successfully onboarded 3 substantial enterprise-level merchants (Backcountry, Bealls, and Rural King) in the same quarter, with GMVs ranging from ~$700 million to over $1.5 billion.
29. Opendoor Technologies Inc. (NASDAQ:OPEN)
Number of Hedge Fund Holders: 20
Opendoor Technologies Inc. (NASDAQ:OPEN) operates a digital platform for residential real estate transactions in the US. It also provides real estate brokerage, title insurance & settlement, escrow services, property & casualty insurance, real estate licenses, and construction services.
In 2024, despite macroeconomic headwinds, Opendoor purchased 30% more homes year-over-year. The contribution margin increased to 4.7%, which was an improvement from the negative 3.7% recorded in 2023. Recognizing the slower start to the 2025 spring selling season and persistent market depression, Opendoor Technologies Inc. (NASDAQ:OPEN) also began increasing spreads in January to better manage risk.
Opendoor is actively enhancing the customer experience to drive higher conversion rates. This includes improvements to its pricing models. Notably, ~70% of the company’s 2024 acquisitions originated from sellers who initially declined an offer but later accepted a refreshed one after re-engagement. For Q1 2025, the company anticipates revenue between $1 billion and $1.075 billion.
28. AST SpaceMobile Inc. (NASDAQ:ASTS)
Number of Hedge Fund Holders: 22
AST SpaceMobile Inc. (NASDAQ:ASTS) designs and develops a constellation of BlueBird satellites in the US. It provides a cellular broadband network in space to be accessible directly by smartphones for commercial use and other applications, as well as for government use. Its SpaceMobile service provides cellular broadband services to end-users who are out of terrestrial cellular coverage.
The MNO (Mobile Network Operator) partnership segment is central to AST SpaceMobile’s go-to-market strategy. AST SpaceMobile has established agreements with ~50 mobile network operators worldwide, which encompass ~3 billion existing subscribers. These partnerships include some of the largest telco providers globally, such as AT&T and Verizon in the US, Vodafone in the US and Turkey, and Rakuten in Japan.
AST SpaceMobile Inc. (NASDAQ:ASTS) recently achieved the STA (Special Temporary Authority) approval received from the FCC to commence service with AT&T and Verizon in the US. This allows for the connection and testing of the company’s Bluebird router with standard smartphones without requiring any specialized software or device updates. In March, UBS analyst Christopher Schoell raised the stock’s price target to $38 from $31, while maintaining a Buy rating.
27. Nerdwallet Inc. (NASDAQ:NRDS)
Number of Hedge Fund Holders: 22
Nerdwallet Inc. (NASDAQ:NRDS) operates a digital platform that provides financial guidance to consumers and small and mid-sized businesses (SMB) in the US, the UK, Australia, and Canada. The NerdWallet app delivers various financial products, such as credit cards, mortgages, insurance, SMB products, personal loans, banking, investing, and student loans.
In Q4 2024 alone, the company’s Insurance revenue surged by 821% year-over-year to $72 million. This growth was attributed to consistent improvements in demand from both consumers and partners. For the full year 2024, the Insurance vertical generated $192 million in revenue, which was up 326%. However, other revenue-generating segments at NerdWallet declined in Q4. For instance, Credit card revenue declined by 19% to $35 million.
Despite these drops, the company was able to make a total revenue of $183.80 million in Q4, which was up 37.47%. While Nerdwallet Inc. (NASDAQ:NRDS) anticipates growth in the Insurance segment during H1 2025, the company expects to face tougher year-over-year comparisons in H2 of the year.
26. Embraer (NYSE:ERJ)
Number of Hedge Fund Holders: 27
Embraer (NYSE:ERJ) designs, develops, manufactures, and sells aircraft and systems in North America, Latin America, the Asia Pacific, Brazil, Europe, and internationally. It operates through Commercial Aviation, Defense & Security, Executive Aviation, Services & Support, and Other segments. It is also involved in leasing used aircraft, as well as pilot, mechanic, and crew training.
In 2024, the company’s Executive Aviation revenues expanded by 25% year-over-year. This contributed to the division achieving an adjusted EBIT of $205 million, which was 62% higher than in 2023. This resulted in an EBIT margin of 11.7%. Executive Aviation also secured its largest order ever, which was a monumental $7 billion contract with Flexjet for 182 firm orders and 30 options.
Notably, the Embraer Phenom 300 maintained its position as the most delivered light jet for the 13th consecutive year and the most delivered twin-engine jet for the 5th consecutive year. By the end of 2024, Executive Aviation had a record backlog of $7.4 billion. For 2025, Embraer (NYSE:ERJ) forecasts delivering between 145 and 155 jets in the Executive Aviation segment, which would be up 15%.
25. e.l.f. Beauty Inc. (NYSE:ELF)
Number of Hedge Fund Holders: 35
e.l.f. Beauty Inc. (NYSE:ELF) provides cosmetic and skin care products under the e.l.f. Cosmetics, e.l.f. Skin, Well People, Naturium, and Keys Soulcare brand names. It offers eye, lip, face, paw, and skin care products. It sells its products through national and international retailers and DTC channels, which include e-commerce platforms.
e.l.f is the number one brand at Target, with over 20% of the market. It also moved up to the number 2 spot at Walmart. The company had 6 of the top 10 new makeup product launches in 2024. Although the overall sales forecast for FY25 was slightly lowered to 27% to 28% growth, e.l.f. Beauty Inc. (NYSE:ELF) plans to continue introducing new versions of popular products. On April 9, Canaccord analyst Susan Anderson expressed that the weakness in the company’s shares due to the tariff situation in the country presents a buying opportunity. The firm has a Buy rating and $105 price target on ELF stock.
e.l.f also doubled its market share in just 3 years. In FQ3, e.l.f.’s color cosmetics segment improved by 16% year-over-year, even though the overall market shrank 5%. This difference allowed the company to gain a 2.2% market share. It’s now the top-selling brand in terms of the number of units sold, with a 14% market share.
Polen US Small Company Growth Strategy is positive on the company’s long-term potential and stated the following regarding e.l.f. Beauty, Inc. (NYSE:ELF) in its Q3 2024 investor letter:
“The Portfolio’s top detractors were Progyny, elf Beauty, and Alarm.com. E.l.f. Beauty, Inc. (NYSE:ELF), a discount beauty company focused on cosmetics and skincare, is a new addition to the Portfolio this quarter. Please see Portfolio Activity below for further detail. We are intrigued by the company’s impressive track record for growth, margins, and returns on capital. While elf has reported significant results all year, shares came under pressure, in our view, as short-term investors primarily appeared to anticipate a slowdown in revenue growth, possibly due to investor concerns of market saturation, economic conditions, and valuation concerns, among other factors. While we are confident in how we underwrote our initial investment for returns above the portfolio average, the stock has come under even more pressure than we anticipated. We used this weakness to add to our position. We’re intrigued by the strength elf has experienced across its retailer and ecommerce channels, particularly in taking market share in a challenging consumer environment, given their relatively inexpensive prices vs. competitors.
elf Beauty, described above, is a discount beauty company focused on cosmetics and skincare. We find the company’s reputation for quality, innovation, and prices below mass cosmetics brands to be uniquely positioned. While this combination of innovation, quality, and value has led to compelling growth, we still believe it’s early days for the company. elf’s brand awareness is significantly less than that of more prominent players; it is still adding shelf space, expanding its product portfolio, and entering the skincare market. elf is also still a US-focused business, with some early signs of international success. The company’s financial profile is strong, and we expect EPS to grow by 25% over the long term.”
24. Energy Transfer (NYSE:ET)
Number of Hedge Fund Holders: 37
Energy Transfer (NYSE:ET) provides energy-related services in the US. It owns and operates natural gas transportation pipelines and storage facilities, and ~12,200 miles of intrastate natural gas transportation pipelines and 20,090 miles of interstate natural gas pipelines. It also sells natural gas to electric utilities, independent power plants, local distribution and other marketing companies, and industrial end-users.
In Q4 2024, Energy Transfer’s NGL and refined products segment generated adjusted EBITDA of $1.1 billion, which was an increase from the $1.04 billion reported in Q4 2023. This improvement was driven by higher throughput and increased rates across the company’s Gulf Coast and Mariner East pipeline operations. For the full year 2024, Energy Transfer exported a record amount of total NGLs out of its Nederland and Marcus Hook terminals.
The company expects to invest ~$1.4 billion in NGL and refined products in 2025. For instance, the Nederland Flexport expansion is anticipated to begin ethane and propane export service by mid-2025, with ethylene export service expected to commence in Q4 2025. On March 25, UBS maintained a Buy rating on Energy Transfer (NYSE:ET) with a $24 price target.
Patient Capital Management remains optimistic on the company’s long-term pricing opportunities, and stated the following regarding Energy Transfer LP (NYSE:ET) in its Q3 2024 investor letter:
“Energy names disappointed in the quarter following commodity prices lower throughout the period. We took the opportunity to add to our highest conviction ideas. We look to names that have idiosyncratic opportunities and are attractive in a variety of different commodity price environments. Many see risk to energy prices over the next year as supply is expected to outstrip demand by 1.3mb/d even before assuming any incremental OPEC supply comes onto the market. With commodities, consensus is rarely right. We assess companies on through cycle returns and normalized prices. From this perspective, we see a handful of attractive opportunities, including Energy Transfer LP (NYSE:ET), Seadrill (SDRL) and Kosmos (KOS).
Our ownership of Energy Transfer began in 2019 with the belief that the limited supply of new pipelines would provide attractive pricing opportunities over the long-term. At the same time, the company was paying us an attractive dividend (10% yield over the period). So far this investment thesis has largely played out, but we continue to see an attractive long-term setup for the name given our belief that natural gas will be a key ingredient to bridge us to a net carbon neutral world.”
23. Rocket Lab USA Inc. (NASDAQ:RKLB)
Number of Hedge Fund Holders: 37
Rocket Lab USA Inc. (NASDAQ:RKLB) is a space company that provides space systems solutions in the US, Canada, Japan, and internationally. It provides launch services, spacecraft design services, spacecraft components, spacecraft manufacturing, and other spacecraft and on-orbit management solutions.
In Q4 2024, Rocket Lab’s Space Systems segment delivered $90 million in revenue, which was up ~7% sequentially. For the full year 2024, the Space Systems segment made $310.8 million in revenue, which was up 80% year-over-year. On April 8, Wells Fargo reiterated an Equal Weight on the stock on April 8, while lowering the $21 price target to $18.
Rocket Lab USA Inc. (NASDAQ:RKLB) has many spacecraft in different stages of production. In March, the company was included in the Phase 3, Lane 1 of the National Security Space Launch program by the US Space Force. It could win $5.6 billion worth of contracts from Space Force. This inclusion shows Rocket Lab’s ability to launch the kind of spacecraft that the government plans to launch over the next 5 years.
ClearBridge Small Cap Growth Strategy stated the following regarding Rocket Lab USA, Inc. (NASDAQ:RKLB) in its Q1 2025 investor letter:
“We continued to generate a number of compelling new ideas, adding five new investments that we still held at quarter end: Glaukos, Rocket Lab USA, Inc. (NASDAQ:RKLB), Karman Holdings (through its IPO), Archrock, Hims & Hers and Geron.
Rocket Lab USA is a manufacturer of spacecraft and satellite components as well as a service provider for satellite launch services, primarily focused today on smaller payloads. With an innovative founder-led management team competing in an enormous market with significant growth in commercial, government and classified applications, we see significant growth potential.”
22. Dutch Bros Inc. (NYSE:BROS)
Number of Hedge Fund Holders: 41
Dutch Bros Inc. (NYSE:BROS) operates and franchises drive-thru shops in the US. It operates through Company-Operated Shops & Franchising and Other segments. It operates through company-operated shops and online channels under the Dutch Bros, Dutch Bros Coffee, Dutch Bros Rebel, Dutch Bros, and Blue Rebel brands.
On March 14, TD Cowen analyst Andrew Charles maintained a Buy rating on the stock with a $89 price target. The sentiment came from the company’s strong growth trajectory due to its potential for expansion based on the trends surrounding the TAM. In Q4 2024, revenue from company-operated shops reached $314 million, which was up 38% year-over-year. This was supported by a company-operated same-shop sales growth of 9.5%, with 5.2% attributed to transaction growth.
Furthermore, beverage, food, and packaging costs for these shops were favorable at 25.4% of revenue, which was a 1.2% improvement driven by pricing. In 2024, 128 out of the 151 new shop openings were company-operated. Dutch Bros Inc. (NYSE:BROS) has a strong pipeline for 2025, with plans to open at least 160 new shops system-wide.
Wasatch Small Cap Growth Strategy stated the following regarding Dutch Bros Inc. (NYSE:BROS) in its Q1 2025 investor letter:
“Another large contributor was Dutch Bros Inc. (NYSE:BROS), a drive-through coffee company in the U.S. that serves customizable hot, iced and blended beverages. Strong fundamentals continue to lift the stock higher. In February, the company announced quarterly revenue and earnings growth that exceeded expectations and announced plans to open more than 150 new stores in 2025. While we like the concept of Dutch Bros.’ stores, the stock has risen substantially in the short time we owned it, and we trimmed the position after those gains.”
21. SoFi Technologies Inc. (NASDAQ:SOFI)
Number of Hedge Fund Holders: 43
SoFi Technologies Inc. (NASDAQ:SOFI) provides various financial services in the US, Latin America, Canada, and Hong Kong. It operates through three segments: Lending, Technology Platform, and Financial Services. It offers lending and financial services and products that allow its members to borrow, save, spend, invest, and protect money.
In 2024, the company reached more than 10 million members, which was an improvement of 34% year-over-year. It added 1.1 million products in Q4, with 89% from Financial Services. The company’s AI-driven platform drove this expansion as it uses AI to recommend products and streamline transactions. The AI-enhanced Financial Services segment saw Q4 revenue of $257 million, which was up 84%.
The Financial Services Productivity Loop at SoFi Technologies Inc. (NASDAQ:SOFI) also uses AI to increase cross-selling, with 30% of new products from existing members. AI also powers the company’s lending platform, which originated $2.1 billion in 2024. The company also recently launched an AI-powered RoboAdvisor, which is a financial planning service that provides investment advice and portfolio management with the aid of AI.
Patient Capital Management increased its investment in the company and stated the following regarding SoFi Technologies, Inc. (NASDAQ:SOFI) in its Q4 2024 investor letter:
“The top performers in the fourth quarter were once again Financials and Travel names. We’ve been over-indexed to them since the pandemic, which has served us well. We strategically added to certain financial names like SoFi Technologies, Inc. (NASDAQ:SOFI) and Coinbase Global Inc. (COIN) during the year. Both companies rebounded strongly in the fourth quarter.
Sofi Technologies Inc. (SOFI) was a standout in the quarter, climbing 95% and up 156% from the intra-day lows in June. The company benefited from Fed rate cuts and the market’s growing optimism that the economy will avoid a recession. The company continues to grow its customer count while successfully cross selling into their loans and financial service products. In the quarter, we saw the company take on a new revenue stream by originating loans for third parties, creating an attractive balance sheet-light revenue source, helping improve return on equity and margins. Sofi is early in its life cycle, currently being a small player in a very large total addressable market (TAM). With their strong management team, we believe the company will continue to deliver on their guidance of strong growth and expanding margins.”
20. Super Micro Computer Inc. (NASDAQ:SMCI)
Number of Hedge Fund Holders: 45
Super Micro Computer Inc. (NASDAQ:SMCI) develops and sells high-performance server and storage solutions based on modular and open architecture. It offers various IT solutions, such as complete servers, storage systems, workstations, networking devices, server sub-systems, and server management and security software.
SMCI’s servers integrate NVIDIA GPUs, which are crucial for AI and data centers. On March 21, JP Morgan analyst Samik Chatterjee upgraded the stock to Neutral from Underweight, while raising the price target to $45 from $35. The company is set to benefit from strong demand for Blackwell-based servers. SMCI also projects ~$40 billion in sales by FY2026, which will be driven by the demand for AI-optimized servers, particularly those incorporating NVIDIA’s advanced chips, and SMCI’s direct-liquid cooling (DLC) technology.
While the company did lower its FY2025 revenue guidance to between $23.5 billion and $25 billion, from a previous range of $26 billion to $30 billion, this was overshadowed by the long-term projection and positive developments regarding its financial reporting.
19. Duolingo Inc. (NASDAQ:DUOL)
Number of Hedge Fund Holders: 52
Duolingo Inc. (NASDAQ:DUOL) operates as a mobile learning platform. It offers courses in 40 different languages, which include Spanish, English, French, German, Italian, Portuguese, Japanese, and Chinese through its Duolingo app. It also provides a digital English language proficiency assessment exam. The Duolingo Max subscription segment performed particularly well in Q4 2024.
Duolingo Max incorporates the GenAI-powered Video Call conversation feature, which has led to growth in user engagement. While currently representing about 5% of total subscribers, Duolingo believes there is room for further monetization of Max, as it is now available to the majority of the company’s 40 million daily active users. This number grew by 51% year-over-year in Q4.
The company plans to use GenAI to further enhance the Video Call experience within Max. Although Max incurs marginal AI costs, its higher pricing more than compensates for these expenses. On April 1, JPMorgan analyst Bryan Smilek maintained an Overweight rating on the stock with a $410 stock price target after conducting field checks to understand trends across acquisition, engagement, teaching efficacy, and the company’s GenAI features.
Baron Opportunity Fund recently initiated a position in the company and stated the following regarding Duolingo, Inc. (NASDAQ:DUOL) in its Q3 2024 investor letter:
“Duolingo, Inc. (NASDAQ:DUOL) is the world’s leading language learning app with over 100 million monthly active users, known for its effective gamification and high engagement. After monitoring the company over the past year and a half, we developed conviction to buy the stock for a few reasons. The company has maintained premium levels of user growth (daily average user growth of over 50%) and revenue growth (40%-plus), executed well against their product roadmap, gained early traction with new functionality, and maintained impressive 40%-plus incremental margins. We view the founder-led management team as best in class, technically capable (CEO and CTO both earned PhDs in machine learning from Carnegie Mellon University), and product focused. We initiated a position in the quarter as the share price fell to what we deemed attractive levels from a long-term valuation perspective, coupled with material catalysts on the horizon, particularly the broader launch of AI functionality (branded “Max”) that enables users to have real-time conversations with AI based characters and a substantial improvement of the company’s Advanced English offering. We believe that these two initiatives take Duolingo from more of a hobby app to a company that can address the broader market of 1.8 billion people learning English today. As these products roll-out in the coming quarters, we believe their adoption should drive the realization of higher pricing, faster revenue growth, lower churn, and continued margin improvement. We also believe there is additional optionality in newer products such as math and music, which are earlier in their product evolution.”
18. Carnival Corp. (NYSE:CCL)
Number of Hedge Fund Holders: 56
Carnival Corp. (NYSE:CCL) provides leisure travel services internationally. It operates port destinations and islands, as well as owns and operates hotels, lodges, glass-domed railcars, and motorcoaches. It sells its cruises through travel agents, tour operators, vacation planners, websites, and onboard future cruise consultants.
On March 31, David Katz from Jefferies reiterated a Buy rating on the stock with a $31 price target. In Q1 2025, the company achieved a robust 7.3% yield increase. The broad-based improvement in onboard spending across all categories contributed to a ~doubling of operating income and an EBITDA that approached a 40% year-over-year increase (reaching $1.2 billion).
The success in driving onboard revenue led to operating margins and EBITDA margins each improving by over 4% year-over-year, which exceeded 2019 levels. Carnival Corp. (NYSE:CCL) now anticipates continued strong demand, with historical high prices for 2025 across all core programs and quarters, and record booking volumes for 2026 sailings and beyond.
17. Target Corp. (NYSE:TGT)
Number of Hedge Fund Holders: 56
Target Corp. (NYSE:TGT) is a general merchandise retailer in the US. It offers apparel for women, men, young adults, kids, toddlers, and babies, as well as jewelry, accessories, and shoes. It also offers beauty products, cosmetics, hair care, oral care, deodorant, and shaving products. It also provides food and beverage products.
The company has stores in all 50 states, with store models perfectly fitting the rural, suburban, and urban markets simultaneously. It expects to add around $15 billion in retail sales over the next 5 years. The company’s online marketplace, called Target Plus, has grown to a $1 billion business and features more than 1,500 trusted partners, and shows double-digit growth.
Target engages with trends, which is highlighted by the record-breaking sales of its Taylor Swift exclusives recently. In January alone, Target introduced 2,000 new wellness products, with 600 being exclusive to the company. Tar-zhay is a term coined by customers for Target’s emphasis on affordable and on-trend products. The company’s merchandising, or Tar-zhay strategy, hinges on a unique product mix, such as a $31 billion portfolio of owned brands.
16. Trade Desk Inc. (NASDAQ:TTD)
Number of Hedge Fund Holders: 63
Trade Desk Inc. (NASDAQ:TTD) is a technology company that offers a self-service cloud-based ad-buying platform. This allows buyers to plan, manage, optimize, and measure data-driven digital advertising campaigns across various ad formats and channels. These include video, display, audio, digital-out-of-home, native, and social.
Trade Desk currently manages over $12 billion in ad spend, within a $1 trillion ad industry. The company’s growth is anchored in its AI-powered advertising platform. The Kokai platform is its latest upgrade and enhances precision and value for clients, driving audience expansion. Trade Desk Inc. (NASDAQ:TTD) is now transitioning all clients to the Kokai platform.
The company is driving the adoption of OpenPath for a more efficient supply chain and pursuing Joint Business Plans (JBPs) with major brands and agencies, which outpace its general growth by 50%. In Q4 2024, Trade Desk’s revenue was up 22% year-over-year, with Q1 2025 revenue growth forecasts around 17%. However, on March 18, Justin Patterson, an analyst at KeyBanc, lowered the price target on the stock to $74 from $130 while keeping his Overweight rating.
Rowan Street Capital highlighted the company’s strong fundamental growth and stated the following regarding The Trade Desk, Inc. (NASDAQ:TTD) in its Q4 2024 investor letter:
“The Trade Desk (TTD): Investment Initiated: March 2020
Internal Rate of Return (IRR): 54%
The Trade Desk has been our most successful investment to date. March 2025 will mark five years since we opportunistically initiated our position at a cost basis of $17.40 (split-adjusted). Since then, TTD has appreciated more than sevenfold, delivering an annualized return of approximately 54%.
These exceptional results far outpace the company’s strong fundamental growth, with revenues and earnings compounding at approximately 25% annually over this period (refer to the table below). The primary reason for this outsized return lies in the price at which we were able to acquire TTD during the early days of the pandemic, when market fears briefly drove it down to just 10x revenues. Today, the valuation has expanded significantly to approximately 25x revenues, amplifying our returns…” (Click here to read the full text)
15. Palantir Technologies Inc. (NASDAQ:PLTR)
Number of Hedge Fund Holders: 64
Palantir Technologies Inc. (NASDAQ:PLTR) builds and deploys software platforms for the intelligence community to assist in counterterrorism investigations and operations in the US, the UK, and internationally. It provides different platforms, which include Palantir Gotham, Palantir Foundry, Palantir Apollo, and Palantir Artificial Intelligence Platform/AIP.
On April 16, Morgan Stanley reiterated the stock as Equal Weight and lowered its price target to $90 from $95. The firm thinks that the company’s technical capabilities allow customers to realize early success on its GenAI initiatives. In 2024, Palantir’s US commercial sector grew by 54% year-over-year due to AIP and generated $702 million in revenue. In Q4 alone, the sector grew by 64%.
The US commercial sector booked $803 million in Total Contract Value in Q4, which indicated a 134% year-over-year improvement. The customer base for this segment also jumped by 73%. Palantir projects US Commercial revenue to surpass $1.079 billion in 2025 at a 54% growth rate. To drive this, Palantir Technologies Inc. (NASDAQ:PLTR) is investing in technical talent and product development to remain at the forefront of the AI revolution.
Alger Mid Cap Focus Fund stated the following regarding Palantir Technologies Inc. (NASDAQ:PLTR) in its Q4 2024 investor letter:
“Palantir Technologies Inc. (NASDAQ:PLTR) builds advanced platforms for data integration, management, and security, enabling interactive, AI-assisted analysis for its users. Its core offerings include Palantir Gotham, designed for government clients, and Palantir Foundry, tailored for commercial customers. Originally focused on U.S. intelligence agencies, Palantir has expanded into defense contracts with western governments and entered the commercial market in 2016. During the quarter, shares contributed to performance after the company reported better-than-expected fiscal third quarter operating results, along with management raising its full year 2024 revenue guidance. Management noted that the recent launch of its AI platform (AIP), which leverages generative AI to optimize business operations, has driven significant growth and investor interest. Additionally, we believe Palantir could be a key partner for the U.S. government’s new Department of Government Efficiency (DOGE), as its AI-driven platforms are ideally suited to help identify inefficiencies, allocate resources effectively, and achieve cost reductions.”
14. Pinterest Inc. (NYSE:PINS)
Number of Hedge Fund Holders: 73
Pinterest Inc. (NYSE:PINS) is a visual search and discovery platform that allows people to find ideas, such as recipes, home & style inspiration, and others. It lets its users search, save, and shop these ideas. It also offers various advertising products to help advertisers meet users, and an ad auction that allows advertisers to serve ads to users at relevant moments.
Pinterest recently introduced Performance Plus, which is an AI-powered product to provide greater performance and efficiency to advertisers while automating campaign setup. In 2024, the company’s efforts to build a suite of lower funnel tools that capture users’ commercial intent began to yield strong results. This contributed to an overall revenue growth of 19% to $3.65 billion, which more than doubled the growth rate from 2023.
In Q4 2024 alone, Pinterest achieved its first $1 billion revenue quarter, which grew revenue by 18% and drove a record number of clicks during the critical holiday season, with clicks to advertisers growing over 90% year-over-year. In 2025, Pinterest Inc. (NYSE:PINS) intends to double down on its efforts to improve these lower funnel tools.
Renaissance Large Cap Growth Strategy recently initiated a position in the company and stated the following regarding Pinterest, Inc. (NYSE:PINS) in its Q4 2024 investor letter:
“We made several changes to the portfolio in the fourth quarter. Most recently, we added a new position in the Communication Services sector in December with Pinterest, Inc. (NYSE:PINS), a leading visual search and discovery platform with a unique curation function that enables users to find and display new ideas and creations that focus on interests such as fashion and home décor among other consumer goods. Since 2022, a new management team has transformed Pinterest into a shopping platform, providing more value and capabilities to advertisers includ ing direct connection with users, resulting in higher profits. In addition, the company was an early adopter of AI to increase personalization, advertising relevance options, and automated processes to increase ease-of-use for smaller advertisers. In the near term, we expect Pinterest to see monetization improvements with upside to Average Revenue Per User (ARPU) and traction in new categories and international markets.”
13. Reddit Inc. (NYSE:RDDT)
Number of Hedge Fund Holders: 87
Reddit Inc. (NYSE:RDDT) operates a digital community that enables users to engage in conversations, explore passions, research new hobbies, exchange goods & services, create new communities & experiences, share laughs, and find belonging. It also organizes communities based on specific interests. On April 17, Truist Financial analyst Youssef Squali maintained a Buy rating on the stock.
In Q4 2024, Reddit’s advertising revenue increased by 60% year-over-year and reached $395 million. This advertising revenue drove total revenue to reach $1.3 billion for the full year 2024, which was up 62%. International advertising revenue also saw a 77% improvement attributed to the company’s ability to connect brands with engaged users.
The company is enhancing its advertising platform by integrating AI-powered tools, such as the AI Headline Generator and Memorable AI. This improves performance and attracts mid-market and SMB advertisers. Reddit Inc. (NYSE:RDDT) also focuses on brand safety and uses its unique community intelligence to develop advertising solutions like Reddit Pro Trends.
Munro Global Growth Small & Mid Cap Fund stated the following regarding Reddit, Inc. (NYSE:RDDT) in its Q4 2024 investor letter:
“Key contributors to performance over the quarter were Reddit and AppLovin (see stock story on page 5). Reddit, Inc. (NYSE:RDDT) delivered a strong set of results, demonstrating impressive revenue growth and expanding operating margins. As the world grapples with misinformation and AI-generated content, we continue to view Reddit’s position as a unique platform hosting the largest volume of human conversations globally becoming increasingly valuable.”
12. PayPal Holdings Inc. (NASDAQ:PYPL)
Number of Hedge Fund Holders: 94
PayPal Holdings Inc. (NASDAQ:PYPL) is a technology platform that enables digital payments for merchants and consumers worldwide. It operates a two-sided network at scale that connects merchants and consumers that enables its customers to connect, transact, and send and receive payments through online and in-person channels.
In Q4 2024, PayPal saw a 4% year-over-year increase in its net revenue to total $8.37 billion. The company also recorded a 2% increase in year-over-year active users. It has more than $11 billion in cash and assets on its balance sheet, along with $5 billion in annual free cash flow. In 2024, PayPal’s branded checkout segment saw consistent quarterly growth in transaction margin dollars, with US growth particularly accelerating in Q4.
PayPal Holdings Inc. (NASDAQ:PYPL) now has 432 million active accounts in 200+ countries. Upgraded checkout experiences, which are now live for more than 25% of US traffic, reduce latency by 40% when fully implemented and boost conversion rates by 1%. The company now has a focus on becoming a commerce platform and expanding into B2B bill pay.
Wedgewood Partners stated the following regarding PayPal Holdings, Inc. (NASDAQ:PYPL) in its Q1 2025 investor letter:
“PayPal Holdings, Inc. (NASDAQ:PYPL) was a leading detractor from performance for portfolios during the quarter. The Company’s branded checkout grew by a healthy +6% while total payment volumes grew by +7% during the Company’s most recent quarter. PayPal also outlined several reinvestment initiatives across its platform that continue to accelerate its branded checkout volume growth back to double digits. In addition, the Company has authorized nearly $20 billion in share repurchases which represents nearly a third of its market cap as of quarter end. We continue to hold PayPal as one of our largest active weights in portfolios.”
11. Micron Technology Inc. (NASDAQ:MU)
Number of Hedge Fund Holders: 94
Micron Technology Inc. (NASDAQ:MU) designs, develops, manufactures, and sells memory and storage products. It has four segments: Compute & Networking Business Unit, Mobile Business Unit, Embedded Business Unit, and Storage Business Unit. It markets its products through its direct sales force, independent sales representatives, distributors, and retailers.
On March 16, Baird analyst Tristan Gerra reiterated a Buy rating on the stock with a $130 price target due to its growth potential in AI-related memory products. Micron is positioning itself strategically to address the growing demand for AI. In Singapore, the company is building a new High-Bandwidth Memory advanced packaging facility, which will be the first of its kind in the country. Micron aims to invest about $7 billion in this project through the end of the decade.
The company’s FQ2 2025 revenue was $8.1 billion, with DRAM revenue at $6.1 billion, which was up 47% year-over-year. NAND revenue was at $1.9 billion, which was up 18%. HBM revenue exceeded $1 billion for the first time, which marked a 50% sequential improvement. It plans further growth in DRAM and NAND bit shipments in FQ3, with revenue projected at ~$8.8 billion.
Parnassus Value Equity Fund stated the following regarding Micron Technology, Inc. (NASDAQ:MU) in its Q2 2024 investor letter:
“Micron Technology, Inc. (NASDAQ:MU) posted fiscal-third-quarter results that met expectations. Micron’s DRAM (dynamic random access memory) and NAND (non-volatile storage technology) segments grew revenue strongly, continuing the company’s recovery from a cyclical downturn last year. We believe Micron is well positioned to capitalize on AI-driven demand for greater memory.”
10. MercadoLibre Inc. (NASDAQ:MELI)
Number of Hedge Fund Holders: 96
MercadoLibre Inc. (NASDAQ:MELI) is an online commerce platform that operates Mercado Libre Marketplace, which is an online commerce platform that can be accessed through the mobile app or website. It also operates Mercado Pago, which is a financial technology solution platform.
In 2024, the company expanded its credit card business and issued 5.9 million new credit cards, which doubled its existing credit portfolio. The Mercado Pago platform also achieved 60 million monthly active users this year. MercadoLibre is now optimizing payment processing times for its POS devices. Furthermore, the company’s advertising revenue grew 37% year-over-year in 2024.
On April 7, Bloomberg reported that MercadoLibre Inc. (NASDAQ:MELI) plans to increase its investment in Brazil by 48% to invest ~$5.8 billion in 2025. This investment will enhance the company’s logistics, technology, marketing, and financial capabilities and allow MercadoLibre to increase its staff in Brazil by 14,000 to reach a total of 50,000 employees.
Lakehouse Global Growth Fund highlighted the company’s significant future potential and stated the following regarding MercadoLibre, Inc. (NASDAQ:MELI) in its February 2025 investor letter:
“The Funds largest position, e-commerce leader MercadoLibre, Inc. (NASDAQ:MELI), delivered another impressive quarterly result, combining robust growth with improving profitability. Net revenue grew 37% year-on-year in U.S. dollar terms to $6.1 billion while operating margins climbed to 13.5%, which was particularly pleasing given the company remains firmly in reinvestment mode. Key operational metrics for its marketplace underscored this strength, with items sold increasing 27%, unique buyers climbing 24% to a new high of 67 million and items per buyer increasing to 7.8. Importantly, the company continues to gain incremental market share in its primary regions, namely that of Brazil and Mexico.
The outperformance of the company’s advertising business also continues to be bright spot, growing 40% plus year-on-year in USD terms. As of today, the advertising business still only represents 2.1% of GMV, which is well below the level of more mature e-commerce peers globally and suggests there is still plenty of runway to grow the ads business. This not only provides another attractive growth vector but also a meaningful lever to improve profitability over time given the higher-margin nature of advertising revenue.”
9. Advanced Micro Devices Inc. (NASDAQ:AMD)
Number of Hedge Fund Holders: 96
Advanced Micro Devices Inc. (NASDAQ:AMD) is a semiconductor fabless company that specializes in HPC and graphics solutions. Its core products represent AMD designs of CPUs such as Ryzen, GPUs, and adaptive SoCs. These are used in cloud infrastructure, personal computing, and gaming, as well as embedded systems.
AMD delivered record annual revenue in 2024 while more than doubling free cash flow from 2023. Q4 revenue increased 24% to a record $7.7 billion due to record quarterly data center and client segment revenue. Despite gaining market share in PCs and servers, Jefferies lowered the stock’s price target from $135 to $120 on March 27 and downgraded it from Buy to Hold. Analyst Blayne Curtis noted that the company’s AI growth remains weaker than anticipated.
The data center segment contributed ~50% of annual revenue as Instinct and EPYC processor adoption expanded significantly with cloud, enterprise, and supercomputing customers. The company successfully established its multibillion-dollar data center AI franchise, delivering greater than $5 billion of data center AI revenue for the year.
8. Tesla Inc. (NASDAQ:TSLA)
Number of Hedge Fund Holders: 126
Tesla Inc. (NASDAQ:TSLA) designs, develops, manufactures, leases, and sells electric vehicles, and energy generation & storage systems. Its Automotive segment offers EVs and related services and products. Whereas the Energy Generation & Storage segment engages in the design, manufacture, installation, sale, and leasing of solar energy generation & energy storage products and related services.
Musk recently stated that the company’s team is laser-focused on bringing robotaxis to Austin in June, with unsupervised autonomy initially being solved for the Model Y in Austin. He anticipates expanding this capability to many other US cities by the end of 2025. After Q1 2025 earnings, Wedbush maintained its Outperform rating on the stock while increasing the price objective from $315 to $350.
While acknowledging the difficulty in predicting the exact ramp-up speed, Musk is confident that millions of Tesla vehicles will be operating fully autonomously in H2 2026. He emphasized Tesla Inc.’s (NASDAQ:TSLA) advantage in using a generalized AI solution with cameras and its in-house designed AI chip, which he contrasts with the more expensive sensor-based approach of competitors like Waymo.
JDP Capital Management initiated a new core position in the company and stated the following regarding Tesla, Inc. (NASDAQ:TSLA) in its Q4 2024 investor letter:
“Tesla, Inc. (NASDAQ:TSLA) is new core position that I wrote about in 2024 Half Year Letter. The stock was up 115% in 2024. We benefited from the June 2024 timing of our purchase, buying after the stock had declined about 30% in the first part of the year.
We repurchased TSLA at a time when the market had [again] become overly bearish based on slowing vehicle orders despite the company having just achieved a breakthrough in Full Self Driving (FSD v12). If you haven’t had a chance to experience the most recent Full Self Driving software (FSD 13.3) I suggest you try it for yourself. If you’ve had a Tesla for a while, you know that the trajectory of FSD improvement has been nothing less than astounding.
It has become clearer to me that Tesla’s leadership position in the infrastructure layer underpinning mega-trends in robotics, smart vehicles and battery storage will unlock earnings growth that we can ride for years. Similar to AWS or the iPhone, Full-Self-Driving and Optimus will enable new business models to be built across a wide range of industries over time…” (Click here to read the full text)
7. Broadcom Inc. (NASDAQ:AVGO)
Number of Hedge Fund Holders: 161
Broadcom Inc. (NASDAQ:AVGO) is a technology company that manufactures and supplies a range of semiconductor, enterprise software, and security solutions.
The company is making moves to advance its innovative solution. Broadcom recently introduced new innovative technologies such as advancements in co-packaged optics (CPO), 200G/lane DSP and SerDes, 400G optics, and PCIe Gen6 over optics. These solutions help grow and scale AI clusters as well as meet the increasing demands of AI workloads that require higher bandwidth, lower latency, and more power-efficient optical interconnects.
On April 22, Barclays analyst Tom O’Malley lowered the price target on the stock to $215 from $260, while keeping an Overweight rating. This adjustment came from Barclays’ updates on semiconductor and semiconductor capital equipment models to reflect tariffs and the trade war ahead of Q1 2025 earnings. However, Broadcom exceeded January quarter estimates and now provides strong April quarter projections.
Mar Vista US Quality Select Strategy maintains a positive long-term outlook on the company and stated the following regarding Broadcom Inc. (NASDAQ:AVGO) in its Q1 2025 investor letter:
“We maintain a positive outlook on Broadcom Inc. (NASDAQ:AVGO) shares, despite recent stock price pressure stemming from two key concerns: (1) uncertainty around potential tariffs and the impact on global growth, and (2) investor skepticism regarding the return profile of large-scale AI capex investments by hyperscalers. This skepticism has been amplified by the efficiency gains recently demonstrated by DeepSeek, an unknown Chinese software company, which developed a competitive large language model at a much lower cost. These efficiency gains stoked fears that hyperscalers may have overbuilt AI infrastructure.
Broadcom maintains a strong competitive position in the custom AI ASIC market, as well as a disciplined capital allocation, most recently reflected in the VMWare acquisition. That deal is already delivering better than-expected top-line growth and margin expansion. Broadcom is the leading provider of custom AI ASICs and has been steadily diversifying its customer base beyond its initial anchor client, Alphabet. Many hyperscalers are interested in developing custom ASICs, which are tailored to specific computing tasks, given their lower costs and attractive performance attributes relative to general-purpose GPUs from providers like NVIDIA.
While we remain constructive on Broadcom’s long-term prospects, we did trim our position earlier in the quarter at higher levels to reallocate capital toward a more favorable risk-reward opportunity. Nonetheless, Broadcom remains a core holding in our portfolio and offers an attractive margin of safety. We believe the company is well-positioned to grow intrinsic value by +20% over the intermediate term.”
6. Apple Inc. (NASDAQ:AAPL)
Number of Hedge Fund Holders: 166
Apple Inc. (NASDAQ:AAPL) designs and sells consumer electronics, software, and services. It’s known for its line of iPhones, iPads, Macs, Apple Watches, and AirPods. The company has a vertically integrated model and a vast network of financially potent users that have potential for upselling and cross-selling opportunities, such as the App Store, iCloud, Apple Music, and Apple TV+ services.
Erik Woodring from Morgan Stanley lowered his iPhone shipment estimates for 2025-2026 by 1% to 5% because of delayed releases at the company. Since June 2024, many features planned for release in April with iOS 18.4 in 2025 have been postponed. The company now aims to fix these issues by 2026. On April 22, Morgan Stanley reiterated the stock as Overweight with a $220 price target. The firm said its survey checks screen positive for Apple regardless of a rough backdrop.
Apple Inc. (NASDAQ:AAPL) is best known for its iPhone product cycle, with 52% of its revenue coming from this product line. The company has over 2.2 billion devices on sale, and the next target is now to integrate AI to strengthen these service offerings. The company’s AI strategy, mainly Apple Intelligence, is driving customer interest, with expectations high for the yet-to-launch iPhone 17 series.
Columbia Seligman Global Technology Fund maintained its position in the company and stated the following regarding Apple Inc. (NASDAQ:AAPL) in its Q4 2024 investor letter:
“The fund maintained a position in Apple Inc. (NASDAQ:AAPL) throughout the quarter through the release of the company’s new iPhone 16 in September. Company leaders were excited about the release of the new model, as this is the first model that will feature enhanced AI capabilities through the Apple Intelligence features. Sales for the first few weeks in October and November trailed behind year over year sales from the iPhone 15, as availability of Apple Intelligence was not compatible with all iPhone models. Apple announced a partnership with OpenAI that has allowed the integration of ChatGPT into the Apple ecosystem, separate from the core Apple Intelligence features. This partnership highlights continued progress from Apple to introduce AI capabilities into its products and we expect the iPhone 17 to have even more expansive AI capabilities, increasing potential demand for the new model that is on track to be released in 2025.”
5. Uber Technologies Inc. (NYSE:UBER)
Number of Hedge Fund Holders: 166
Uber Technologies Inc. (NYSE:UBER) is a multinational company that offers a range of services, such as ride-hailing, food delivery through Uber Eats, courier services, and freight transport. It operates in thousands of cities across 70 countries around the world. It has three segments: Mobility, Delivery, and Freight.
Uber’s progress in the AV space, particularly its partnership with Waymo, positions it well for the future of transportation. During Q4 2024, Uber Technologies Inc. (NYSE:UBER) grew its gross bookings by 18% year-over-year. This resulted in the revenue growing 20% during the same time to reach $12 billion. In 2025, the company expects to extend to Atlanta and Austin.
On April 23, Justin Post from Bank of America Securities reiterated a Buy rating on UBER stock and set a $95 price target. Post gave this rating despite the recent FTC lawsuit against Uber in association with its Uber One subscription policies, which accused the company of deceptive billing and cancellation practices. By 2027, the management anticipates a nearly 50% increase in free cash flow.
Hardman Johnston Global Equity Strategy remains bullish on the company and stated the following regarding Uber Technologies Inc. (NYSE:UBER) in its Q4 2024 investor letter:
“During the quarter, we initiated three new positions in Lennar Corporation, Bank of America Corp., and Uber Technologies, Inc. (NYSE:UBER). Uber is a leading platform company that facilitates ride-hailing, food delivery, and freight booking services, which each represent large and underpenetrated markets. Uber is active in more than 10,000 cities and approximately 70 countries globally, and Uber is a market leader with more than 65% market share in nearly all ride-sharing regions in which it operates. Uber should continue to benefit from secular tailwinds, product innovation, expansion, and network effects. The cross-selling of the Uber One membership program should drive both loyalty and engagement. International markets represent half the business and continue to be an important growth driver. Overall, we see sustained healthy topline growth for the company over the next three years with some insulation to global economic trends.”
4. Taiwan Semiconductor Manufacturing Co. Ltd. (NYSE:TSM)
Number of Hedge Fund Holders: 186
Taiwan Semiconductor Manufacturing Co. Ltd. (NYSE:TSM) manufactures, packages, tests, and sells integrated circuits and other semiconductor devices. It provides various wafer fabrication processes, such as processes to manufacture complementary metal-oxide-semiconductor logic, mixed-signal, radio frequency, embedded memory, and others.
On April 21, TSMC announced that its role in the semiconductor supply chain limits its ability to ensure export compliance. The announcement came months after its AI silicon was found with US-sanctioned Huawei Technologies Co. through intermediaries. On the same day, Barclays analyst Simon Coles lowered the price target on the stock to $215 from $255 while keeping an Overweight rating. According to the analysts, TSMC shares are already pricing in a slowdown.
In FQ1 2025, HPC made 59% of TSMC’s total revenue, which totaled $25.78 billion and improved by 41.40% year-over-year. This HPC revenue itself improved by 7% sequentially due to the sustained demand for AI-related applications, which the CEO of the company anticipates to double in revenue in 2025. To support this explosive growth in AI and HPC, TSMC is making substantial investments in advanced packaging technologies, particularly CoWoS. Taiwan Semiconductor Manufacturing Co. Ltd. (NYSE:TSM) is working to double its CoWoS capacity in 2025.
The company’s results and guidance showcased strong AI chip demand, which is why Sands Capital Technology Innovators Fund stated the following regarding Taiwan Semiconductor Manufacturing Company Limited (NYSE:TSM) in its Q4 2024 investor letter:
“Taiwan Semiconductor Manufacturing Company Limited (NYSE:TSM) third-quarter 2024 results and guidance showcased strong continued demand for artificial intelligence (AI) chips. Revenue increased by 29 percent, and earnings saw a 54 percent rise year-over-year. Gross margins were at their highest since 2022, bolstered by price hikes and record utilization at both the 3 nanometer (nm) and 5nm nodes. TSMC’s full-year revenue outlook was revised upward from 25 percent to 30 percent growth. The company also anticipates higher capital expenditure in 2025, a leading indicator for revenue.
Meanwhile, TSMC’s competitive position within the leading-edge chip fabrication industry has improved. The company noted that demand for its next-generation 2nm (N2) node is considerably higher than for its predecessor, N3. Additionally, TSMC has more capacity for N2 than N3. This situation contrasts with Intel and Samsung, which both recently disclosed struggles in ramping up their leading-edge nodes. Together, Intel and Samsung account for approximately $25 billion of foundry revenue, which could potentially migrate to TSMC over time…” (Click here to read the full text)
3. NVIDIA Corp. (NASDAQ:NVDA)
Number of Hedge Fund Holders: 223
NVIDIA Corp. (NASDAQ:NVDA) is a tech company that is known for its edge in GPUs and AI platforms. Its primary revenue stems from data center GPUs like the H100 and Blackwell chips, which are essential components for AI workloads. The company is positioned to target huge markets like a $1 trillion-plus AI market, a $500 billion enterprise AI sector, and a $50 trillion robotics market.
Mizuho analysts are optimistic about NVIDIA’s near-term prospects, particularly with the shipment of the GB200 series and increased testing capacity for more complex GPU racks. The analysts also highlighted NVIDIA’s long-term capital expenditure in AI for the calendar year 2026 as an important point for investors.
On April 16, Mizuho Securities maintained its Outperform rating on the stock with a $168 price target, despite new US export restrictions that affect shipments of its H20 series products to China and other embargoed countries. These restrictions may impact around $5.5 billion in revenue from an estimated $16 billion in H20 orders.
Guinness Global Innovators is highly bullish on NVIDIA Corp. (NASDAQ:NVDA) due to its dominant AI chip market position. It stated the following in its Q4 2024 investor letter:
“For a second year running, NVIDIA Corporation (NASDAQ:NVDA) was the Fund’s top performing stock, delivering a stellar return of +177.7% over the year. Since the beginning of last year, Nvidia’s ‘Hopper’ GPUs have been at the centre of exploding demand for chips powerful and efficient enough to facilitate the energy intensive requirements of AI processes within datacentres. Initially possessing over 95% of market share in these types of chips, Nvidia have been quick to entrench their position as the technological leader in the space, launching the successor to the current ‘Hopper’ GPU in March, Blackwell, inhibiting the likes of AMD and Intel making meaningful inroads in taking share of the fast-growing market. Compared to the previous iteration (Hopper) which is continuing to fuel Nvidia’s extreme revenue growth, the Blackwell chip is twice as powerful for training AI models and has 5 times the capability when it comes to “inference” (the speed at which AI models respond to queries). Throughout the year, Nvidia’s financial performance has remained resilient. Quarterly revenues hit $35.1 billion in their most recent quarter, beating consensus expectations by 6% and representing a +94% year-over-year increase. Additionally, Nvidia’s data centre segment, driven by the Hopper (H100) chip, grew fivefold over the past year, underscoring the sustained demand for advanced AI infrastructure. The H100 chip, priced at around $40,000, continues to see significant adoption due to its ability to enhance AI model training efficiency while lowering overall costs. This growth is expected to continue as companies invest in upgrading existing data centres and building new ones, with Nvidia well-positioned to capture a significant share of the estimated $2 trillion market opportunity over the next five years. There have been some concerns over Blackwell production delays causing share price volatility however, Nvidia has recovered swiftly, driven by positive earnings results through the year and assurances from management regarding future supply. Additionally, the release of the H200 chip promises to extend Nvidia’s technological leadership, ensuring continued momentum into 2025. While Nvidia’s valuation remains a topic of debate, the stock is not at a significant premium to history, and it still appears reasonable given its dominant market position, innovative prowess, and exposure to long-term secular growth trends in AI, cloud computing, and data infrastructure. As a result, Nvidia remains well-positioned to deliver sustained outperformance over the long term, making it a cornerstone of growth-oriented portfolios.”
2. Alphabet Inc. (NASDAQ:GOOGL)
Number of Hedge Fund Holders: 234
Alphabet Inc. (NASDAQ:GOOGL) is a technology company that provides web-based search, consumer content, enterprise solutions, software engines, and advertisements through its subsidiaries. The company operates through different segments, which are the Google Services, Google Cloud, and Other Bets segments.
In Q1 2025, Google Cloud generated $12.3 billion in revenue, which was an increase of 28% year-over-year. This was driven by the performance across both the segment’s core offerings and its AI products. Google Cloud is experiencing significant demand for its solutions, particularly in AI infrastructure, agents, and more, as highlighted at Cloud Next, where over 500 companies shared their positive business outcomes from partnering with Google Cloud.
The company’s Vertex AI platform offers over 200 foundation models, which includes its industry-leading Gemini models that enable customers to integrate AI into their operations. BofA Securities recently maintained a Buy rating on Alphabet Inc.’s (NASDAQ:GOOGL) stock.
Oakmark Equity and Income Fund stated the following regarding Alphabet Inc. (NASDAQ:GOOGL) in its Q4 2024 investor letter:
“Alphabet Inc. (NASDAQ:GOOGL) was the top contributor during the quarter. Despite ongoing litigation with the Department of Justice in its antitrust case, the U.S.-headquartered interactive media and services company’s stock price rose after posting solid third-quarter earnings. In the Search division, the company generated low-teens year-over-year revenue growth and management highlighted that they’re seeing strong user engagement with their new AI Overviews feature. The biggest upside surprise came from the Cloud division, where revenue growth accelerated to 35% and margins reached a record of 17%. This performance was driven by client demand for AI Infrastructure and Generative AI Solutions as well as core Google Cloud Platform (GCP) products. We continue to believe Alphabet is a collection of great businesses that can unlock further value over the long term through its world-class AI capabilities.”
1. Amazon.com Inc. (NASDAQ:AMZN)
Number of Hedge Fund Holders: 339
Amazon.com Inc. (NASDAQ:AMZN) is a large e-commerce platform. It also operates cloud computing services through its Amazon Web Services (AWS) segment, together with digital streaming and AI. The company recently unveiled its new AI model, called Nova Act, which is a software development kit that takes actions in a web browser on the user’s behalf to automate routine tasks.
The company’s revenue grew by 10% year-over-year in 2024, with an operating income of $21.2 billion, which was up 61%. Amazon’s North America segment grew 10% while the International segment saw 9% growth.. AWS continued its robust performance with 19% growth and an annualized revenue run rate of $115 billion. The company’s customers are now moving to the cloud to use AI.
Amazon’s own AI chips, Tranium 2, are 30% to 40% cheaper than its competitors, which helps it attract big clients like Anthropic. Amazon Bedrock is one of the company’s key AI services, which offers various AI models. Amazon Q, which is an AI assistant, is saving companies time and money and showcases practical AI use. On April 22, Goldman Sachs reiterated the stock’s rating as Buy due to secular growth themes across Consumer Internet and Cloud Computing. However, the firm lowered its price target to $220 from $255.
Harding Loevner Global Developed Markets Equity Strategy stated the following regarding Amazon.com, Inc. (NASDAQ:AMZN) in its Q4 2024 investor letter:
“During the quarter, we benefited from strong stocks within the Communication Services and Consumer Discretionary sectors. In Consumer Discretionary, Amazon.com, Inc. (NASDAQ:AMZN) reported strong third-quarter results. Revenue increased by double digits, led by growth in advertising and Al products, while the company’s operating margins also hit an all-time high of 11%. The key reasons for the higher margins were that its international e-commerce operations turned profitable, and there was faster growth in its high-margin cloud-computing business.”
While we acknowledge the growth potential of Amazon.com Inc. (NASDAQ:AMZN), our conviction lies in the belief that AI stocks hold great promise for delivering high returns and doing so within a shorter time frame. There is an AI stock that went up since the beginning of 2025, while popular AI stocks lost around 25%. If you are looking for an AI stock that is more promising than AMZN but that trades at less than 5 times its earnings, check out our report about this cheapest AI stock.
READ NEXT: 20 Best AI Stocks To Buy Now and 30 Best Stocks to Buy Now According to Billionaires.
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