In this article, we will look at the 8 Best AI Software Stocks to Buy According to Hedge Funds.
On June 17, Mohamed El-Erian, Chief Economic Advisor at Allianz, appeared on CNBC’s ‘Closing Bell’ to talk about the latest comments from the Federal Reserve.
He was of the view that this is a very different Fed, and the risk right now that is happening in markets and some of the commentary, according to him, is that people are applying the old playbook to a new Fed without understanding that this Fed is pivoting. All the focus right now is on the SEP, and the SEP is of dubious content and would become even more dubious going forward. He added that we heard today that this is a Fed chair who is very serious about reforming the institution so it can deliver better policies, and we have the five areas he is going to be focusing on.
READ ALSO: 15 Best NASDAQ Stocks to Buy and Hold For 3 Years AND 12 Best NYSE Stocks to Buy for Long-Term Investment.
El-Erian further stated that he believes the market’s reaction to what happened today is negative, and it has taken it too hawkish. He thinks they are just reacting to the SEP and expected to hear something they would have heard during the Powell tenure. They are not going to get that, as this is a very different Fed chair who communicates very differently and does not believe in forward guidance.
With these broader market trends in view, let’s look at the best AI software stocks to buy according to hedge funds.
Our Methodology
We used stock screeners and online sources to identify the best AI software stocks and then selected the top 8 stocks most popular among hedge funds as of Q1 2026, using the hedge fund sentiment data from Insider Monkey’s database. The stocks are arranged in ascending order of hedge fund sentiment.
Note: All data was recorded on June 17.
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. Insider Monkey’s quarterly newsletter strategy selects 14 small-cap and large-cap stocks every quarter and has returned 599.2% since May 2014, beating its benchmark by 372 percentage points (see more details here).
8 Best AI Software Stocks to Buy According to Hedge Funds
8. UiPath Inc. (NYSE:PATH)
Number of Hedge Fund Holders: 40
UiPath Inc. (NYSE:PATH) is one of the best AI software stocks to buy according to hedge funds. UiPath Inc. (NYSE:PATH) announced on June 16, Maestro Case, which is a new AI-native UiPath agentic case management capability available as part of the UiPath Maestro™ business orchestration capabilities. It further stated that Maestro Case “extends governed orchestration and automation to complex and exception-laden case management”, which allows enterprises to manage dynamic, long-running cases with increased control, visibility, and execution speed.
In a separate development, BMO Capital cut the price target on UiPath Inc. (NYSE:PATH) to $13 from $14 on June 1 and maintained a Market Perform rating on the shares. The firm told investors in a research note that UiPath Inc. (NYSE:PATH) delivered a good start to FY27 with revenue upside. However, Net New Annual Recurring Revenue was modestly below consensus on a constant currency basis. BMO believes that the larger AI-driven deals and strength in enterprise cohorts will drive net new ARR growth.
UiPath Inc. (NYSE:PATH) is involved in the development and provision of a software platform to automate business processes. The company serves the healthcare, public, finance, telecommunication, and banking industries, and also offers claims processing automation, accounts payable automation, finance and accounting automation, and contact center automation.
7. Snowflake Inc. (NYSE:SNOW)
Number of Hedge Fund Holders: 80
Snowflake Inc. (NYSE:SNOW) is one of the best AI software stocks to buy according to hedge funds. Truist lifted the price target on Snowflake Inc. (NYSE:SNOW) to $300 from $275 on June 4 and reiterated a Buy rating on the shares, telling investors in a research note that following discussions at the Snowflake Summit 2026, customer and partner feedback suggest that the company’s CoCo tools are accelerating workload creation, migrations, and platform expansion. This is driving increased usage, while also bolstering Snowflake Inc.’s (NYSE:SNOW) role as a governance, connectivity, and orchestration layer for enterprise AI. The firm added that this is also supporting expectations for improved productivity, operating leverage, and long-term AI-driven growth.
Snowflake Inc. (NYSE:SNOW) also received a rating update from Scotiabank on June 8, with the firm lifting the price target on the stock to $320 from $285 while reiterating an Outperform rating on the shares. It told investors that the firm left the Summit 2026 with confidence that the company is benefiting from enterprise AI adoption.
Snowflake Inc. (NYSE:SNOW) provides cloud data warehousing software and offers Data Cloud, an ecosystem that allows customers, data providers, partners, and data consumers to break down data silos and derive value from data. The company’s platform supports a range of use cases, including data lakes, data warehousing, data engineering, data application development, data science, and data sharing.
6. Adobe Inc. (NASDAQ:ADBE)
Number of Hedge Fund Holders: 86
Adobe Inc. (NASDAQ:ADBE) is one of the best AI software stocks to buy according to hedge funds. Citi cut the price target on Adobe Inc. (NASDAQ:ADBE) to $228 from $264 on June 12 and reaffirmed a Neutral rating on the shares, telling investors in a research note that the company reported “relatively solid” fiscal Q2 numbers. However, Citi pointed to “more signs of disruption” with an implied $500M cut in its fiscal 2026 organic annual recurring revenue outlook. The firm cut estimates post the earnings print.
Adobe Inc. (NASDAQ:ADBE) also received a rating update from Freedom Broker on the same day. The firm downgraded the stock to Hold from Buy, bringing the price target on the shares down to $250 from $510 and telling investors in a research note that the company’s growth quality shifted this quarter, as the acceleration was acquired rather than organic. It believes that the company is now in a “show-me phase” and added that management is deliberately trading near-term subscription revenue for top-of-funnel reach.
Adobe Inc. (NASDAQ:ADBE) is a global technology company that provides digital marketing and media solutions. The company’s operations are divided into the following segments: Digital Media, Digital Experience, and Publishing and Advertising.
While we acknowledge the potential of ADBE 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 ADBE and that has 100x upside potential, check out our report about the cheapest AI stock.
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