Earlier, on December 29, Paul Christopher of Wells Fargo joined ‘The Exchange’ on CNBC to discuss his 2026 investing playbook, including his approach to the AI trade. Christopher argued that diversification is a critical strategy heading into 2026. While he acknowledged that the current trend in capital expenditure on AI and equipment will likely remain a reliable growth driver, he cautioned against relying solely on the MAG7 stocks, which can become overextended. Instead, he suggested playing the AI trend through subsidiary routes, specifically mentioning the industrials and utilities sectors. These sectors offer exposure to data centers at lower P/E ratios compared to potentially overpriced tech stocks. Additionally, emerging markets, specifically South Korea and Taiwan, are identified as strategic areas for diversification because they produce much of the tech used in the AI space.
Beyond insurance companies that recently made the AI and data center opportunity a central thesis in their earnings report, Christopher highlighted banks as a strong play. Christopher also anticipates that 2026 will be a year of broadening growth across multiple sectors, where market performance is fueled fundamentally by corporate earnings rather than just upward price momentum.
That being said, we’re here with a list of the 7 hidden AI stocks under $10 to buy.
Our Methodology
We sifted through financial media reports to compile a list of the top hidden AI stocks with AI-related operations and opportunities. We then selected 7 stocks that were the most popular among elite hedge funds and that analysts were bullish on. The stocks are ranked in ascending order of the number of hedge funds that have stakes in them, as of Q3 2025.
Note: All data was sourced on February 5.
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).
7 Hidden AI Stocks Under $10 to Buy
7. Himax Technologies Inc. (NASDAQ:HIMX)
Number of Hedge Fund Holders: 12
Himax Technologies Inc. (NASDAQ:HIMX) is one of the hidden AI stocks under $10 to buy. On February 4, Morgan Stanley downgraded Himax from Overweight to Equal Weight while maintaining an $8 price target. This decision was announced amid multiple challenges for display driver integrated circuit vendors.
Morgan Stanley anticipates that softened demand in the computer, smartphone, and automotive sectors, combined with gross margin pressure and a deficiency of new growth drivers, will hinder performance. Furthermore, the firm noted that rising memory costs are expected to create additional headwinds, contributing to continued downside across these primary market segments.
In other news, on January 7, Himax Technologies Inc. (NASDAQ:HIMX) and Vuzix Corp. introduced a lightweight, prescription-ready optical component reference design for AR glasses at CES 2026. This collaboration integrates Himax’s ultra-compact HX7319FL color sequential Front-lit LCoS microdisplay with Vuzix’s high-efficiency waveguide technology to create a power-efficient, scalable solution for OEMs and eyewear makers. By providing a production-ready platform that balances performance and form factor, the companies aim to accelerate the commercialization of all-day wearable AR glasses.
Himax Technologies Inc. (NASDAQ:HIMX) is a fabless semiconductor company that provides display imaging processing technologies in China, Taiwan, Korea, Japan, the US, and internationally. The company operates in two segments: Driver IC and Non-Driver Products.
6. One Stop Systems Inc. (NASDAQ:OSS)
Number of Hedge Fund Holders: 13
One Stop Systems Inc. (NASDAQ:OSS) is one of the hidden AI stocks under $10 to buy. On January 5, Alliance Global raised its price target for One Stop Systems to $9 from $8.50 while keeping a Buy rating following the company’s $22.4 million sale of its European value-added reseller, Bressner Technology, to Hiper Euro.
The firm noted the sale price exceeded expectations and characterized the divested business as a minimal contributor to shareholder value due to its very low contribution margin. Consequently, Alliance Global suggested that the proceeds from this transaction can be strategically redirected toward future M&A opportunities to drive growth.
A day before that, Roth Capital also increased the price target for One Stop Systems Inc. (NASDAQ:OSS) to $9 from $8 with a Buy rating after the company’s divestment of Bressner Technology. The firm described One Stop as a pure play leader in ruggedized AI, ML, and edge compute solutions, and noted that the sale left the company with a flush balance sheet.
One Stop Systems Inc. (NASDAQ:OSS) designs, manufactures, and markets rugged high-performance compute, high-speed switch fabrics, and storage systems for edge applications of AI and ML, sensor processing, sensor fusion, and autonomy in the US and internationally.
5. Lantronix Inc. (NASDAQ:LTRX)
Number of Hedge Fund Holders: 15
Lantronix Inc. (NASDAQ:LTRX) is one of the hidden AI stocks under $10 to buy. On January 27, Lantronix and Safe Pro Group entered into a partnership, established through a Memorandum of Understanding and a Master Services Agreement, to develop AI-driven edge intelligence for defense and autonomous systems. The collaboration focuses on integrating Safe Pro’s Object Threat Detection algorithms with Lantronix’s Qualcomm-based Open-Q SOM (System-on-Module) solutions.
This joint effort aims to create embeddable chipsets that enable real-time, on-device threat detection for drones and unmanned aerial systems without requiring cloud connectivity. The technical integration leverages the Open-Q 5165RB SOM, which uses the Qualcomm Dragonwing QRB5165 System on Chip to provide high-performance, power-efficient computing. By processing AI models locally, the architecture improves latency and resilience while enhancing mission-critical security.
The design is optimized for identifying landmines and other small threats, supporting configurations that require advanced machine vision and neural network capabilities directly at the network edge. The partnership also targets high-growth opportunities within the global drone market by collaborating on programs such as Red Cat Holding’s Teal Black Widow quadcopters for the US Army. The initiative also includes integrating AI outputs into the Android Tactical Assault Kit platform via secure gateways. This alignment is intended to accelerate Lantronix’s Edge AI strategy.
Lantronix Inc. (NASDAQ:LTRX) develops, markets, and sells industrial and enterprise IoT products and services in the Americas, Europe, the Middle East, Africa, and the Asia Pacific Japan.
4. Quantum Computing Inc. (NASDAQ:QUBT)
Number of Hedge Fund Holders: 17
Quantum Computing Inc. (NASDAQ:QUBT) is one of the hidden AI stocks under $10 to buy. On February 2, Quantum Computing completed the acquisition of Luminar Semiconductor from Luminar Technologies in an all-cash transaction valued at $110 million. This acquisition helps Quantum Computing become a vertically integrated, domestic provider of photonics and quantum platforms. By combining Quantum Computing’s thin-film lithium niobate technology with Luminar Semiconductor’s established expertise in lasers, detectors, packaging, and manufacturing, the company aims to produce chip-scale, mass-producible quantum hardware that operates at room temperature.
Earlier on January 15, Rosenblatt initiated coverage of Quantum Computing Inc. (NASDAQ:QUBT) with a Buy rating and a $22 price target, highlighting the company’s legitimate assets in photonics, compute, security, and sensing.
The firm emphasized the potential of the company’s thin-film lithium niobate fabs, which are positioned to meet industry demand for integrated quantum photonics, nonlinear optics, and optical waveguides. Overall, the firm views the stock’s risk/reward profile favorably, identifying an immediate opportunity for investors to gain exposure to the quantum computing sector.
Quantum Computing Inc. (NASDAQ:QUBT) is an integrated photonics company that provides quantum machines to commercial and government markets in the US.
3. SoundHound AI Inc. (NASDAQ:SOUN)
Number of Hedge Fund Holders: 22
SoundHound AI Inc. (NASDAQ:SOUN) is one of the hidden AI stocks under $10 to buy. On January 21, SoundHound AI partnered with Bridgepointe Technologies to accelerate the enterprise adoption of its Amelia 7 AI agent platform and Autonomics solution. Bridgepointe is a technology advisory firm with a network of over 12,000 companies and will use its consulting and engineering expertise to help businesses strategically implement these autonomous AI tools.
The collaboration aims to provide clients with conversational AI and IT automation solutions that streamline operations, enhance customer experiences, and deliver measurable return on investment. Amelia 7 uses an Agentic+ architecture to handle complex, multi-step queries via voice or text, employing automatic speech recognition to allow for natural human interaction and autonomous task resolution.
Complementing this, the Autonomics platform transforms traditional IT monitoring into a self-healing system that can automatically detect, diagnose, and resolve infrastructure issues through a single interface. Together, these technologies offer an end-to-end automation suite for diverse sectors, including retail, financial services, and healthcare.
SoundHound AI Inc. (NASDAQ:SOUN) develops independent voice AI solutions that enable businesses across automotive, TV, and IoT, and customer service industries to deliver high-quality conversational experiences to their customers in the US, Korea, France, Japan, Germany, and internationally.
2. BigBear.ai Holdings Inc. (NYSE:BBAI)
Number of Hedge Fund Holders: 23
BigBear.ai Holdings Inc. (NYSE:BBAI) is one of the hidden AI stocks under $10 to buy. On January 7, Cantor Fitzgerald downgraded BigBear.ai from Overweight to Neutral and lowered the price target to $6 from $7. This sentiment was announced as the firm cited pressured near-term fundamentals.
The firm particularly noted a 20.1% year-over-year revenue decline in Q3 2025, resulting from federal program disruptions, and highlighted elevated execution risks due to the company’s reliance on inconsistent government contracts. These factors continue to drive operating losses and contribute to ongoing margin pressure for the organization.
In other news, earlier on December 31, BigBear.ai Holdings Inc. (NYSE:BBAI) completed its $250 million cash acquisition of Ask Sage, which is a GenAI platform designed for secure deployment in defense, intelligence, and regulated sectors. The acquisition builds on a previously announced agreement and integrates Ask Sage’s capabilities, which currently serve over 100,000 users across 16,000 government teams, into BigBear.ai’s existing AI portfolio.
BigBear.ai Holdings Inc. (NYSE:BBAI) provides AI-powered decision intelligence solutions. The company offers national security, supply chain management, and digital identity and biometrics solutions.
1. Asana Inc. (NYSE:ASAN)
Number of Hedge Fund Holders: 28
Asana Inc. (NYSE:ASAN) is one of the hidden AI stocks under $10 to buy. On February 3, Piper Sandler lowered its price target for Asana to $14 from $19, while keeping an Overweight rating following a transfer of coverage. This adjustment came as part of a broader move in which the firm downgraded three companies and reduced price targets across the platforms and apps group, citing seat-compression and vibe coding narratives as factors that could limit valuation multiples.
Despite share declines over the past year, Piper Sandler holds mixed views on the software sector and anticipates ongoing pessimism, though it is not making specific calls on upcoming Q4 2025 reports. Instead, the firm recommends focusing on the hyperscaler, consumption, and vertical sub-sectors.
Earlier on January 5, RBC Capital also cut its price target for Asana Inc. (NYSE:ASAN) to $11 from $14 with an Underperform rating. The firm anticipates that 2026 will be a pivotal year in which companies well-prepared for enterprise AI adoption will see clear tailwinds, whereas less-positioned peers may struggle against a narrative suggesting that AI could negatively disrupt the software industry.
Asana Inc. (NYSE:ASAN), together with its subsidiaries, operates a work management software platform for individuals, team leads, and executives in the US and internationally.
While we acknowledge the potential of ASAN to grow, 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 ASAN and that has 100x upside potential, check out our report about this cheapest AI stock.
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