5 Best Stocks to Invest In According to Two Sigma Advisors with Huge Upside Potential

4. ExlService Holdings, Inc. (NASDAQ:EXLS)

Stock Upside Potential: 62.30%

Number of Hedge Fund Holders: 38

Two Sigma Advisors’ Stake: $112,958,294

ExlService Holdings, Inc. (NASDAQ:EXLS) is one of the best stocks to invest in according to Two Sigma Advisors with huge upside potential. On June 24, ExlService Holdings, Inc. (NASDAQ:EXLS) announced a definitive agreement to acquire iMerit Inc in a transaction valued at up to $310 million. iMerit is a specialist in AI model training, evaluation, and reinforcement learning.

ExlService said the deal is structured as a cash transaction and that the first part comprises $170 million paid upfront at closing. The payment will be subject to standard debt, cash, and working capital adjustments. The second tranche of $140 million will be in the form of cash incentives and earnouts paid over two years. This one too will be contingent on iMerit hitting specified post-close performance milestones.

The company noted that the transaction will see iMerit bring its Ango platform to ExlService. Ango is a data labeling and annotation tool used in building and refining AI models. The other core asset ExlService will absorb is iMerit’s Scholars expert network. This is a curated community of human domain specialists who support AI model training and evaluation tasks requiring real-world expertise. These capabilities are in high demand among frontier AI labs and large enterprises alike, the company noted.

ExlService plans to integrate both platforms into its existing AI product stack. The goal is to deepen its end-to-end AI offering for regulated industries such as healthcare, insurance, banking, and capital markets.

ExlService Holdings, Inc. (NASDAQ:EXLS) is a business process management and data analytics company. It provides operations management, decision analytics, and digital transformation services to industries including insurance, healthcare, banking, and travel.