In this article, we take a look at the 8 Best Generative AI Software Stocks to Buy in June 2026.
On June 12, McKinsey & Company noted that, despite many organizations adopting AI coding tools, only a few are able to capture the full value of these technologies because they layer AI onto existing processes rather than redesigning workflows around it.
“AI is rapidly changing software development, but research consistently shows that organizations still struggle to translate experimentation into meaningful, sustained impact. The promised land of tenfold to 20-fold productivity from AI still seems far away for most companies,” McKinsey said, noting that most companies are only experiencing productivity gains of about 1.2x.
The global management consulting firm said that the challenge goes beyond tool adoption, emphasizing that it requires redesigning the product development life cycle (PDLC), including the fundamental ways software teams work.
McKinsey partnered with the code quality and governance platform Sonar for a case study in which Sonar redesigned its PDLC to be AI-native and piloted the new approach with selected teams. By the end of the pilot, McKinsey noted that the teams saw improvements across velocity and quality, emphasizing that redesigning workflows around AI reduced friction across handoffs and enabled more parallel work across product, engineering, and design, while agents supported execution.
“While approaches to measuring velocity vary across organizations and teams, at Sonar, teams focused on pull request throughput and cycle time. Front-runner teams improved pull request throughput by up to 2.2 times and reduced pull request cycle times by up to 3.4 times, with self-reported productivity gains in build ranging from 50 to 80 percent across teams,” McKinsey said.
Moreover, the consulting firm highlighted that the shift to AI-native development is not a question of if, but how quickly organizations can adapt. It added:
“Organizations that move beyond experimentation to redesign their PDLC around AI will unlock disproportionate gains not only in productivity, but in how quickly they learn, iterate, and deliver value to users. Those that fail to do so risk optimizing the past, while others redefine the future.”
As we take into consideration the results of the case study, let’s take a look at the 8 Best Generative AI Software Stocks to Buy in June 2026.
Our Methodology
To compile our list of the 8 Best Generative AI Software Stocks to Buy in June 2026, we relied on financial media, ETFs, and screeners to identify AI software stocks with significant upside potential. From this pool, we selected the 8 stocks most widely owned by hedge funds, based on Q1 2026 filings from Insider Monkey’s database. These names were then ranked by the number of hedge funds holding positions in them.
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’s 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).
Note: All pricing data is as of market close on June 15, 2026.
8. GitLab Inc (NASDAQ:GTLB)
Potential Upside: 13.03%
Number of Hedge Fund Holders: 43
GitLab Inc (NASDAQ:GTLB) is one of the 8 Best Generative AI Software Stocks to Buy in June 2026. On June 15, Investing.com reported that Cantor Fitzgerald maintained its Neutral rating on GitLab with a price target of $35 as the company introduced four new capabilities.
At its Transcend event last week, GitLab announced new capabilities, particularly the Next Generation Source Code Management in private beta, GitLab Orbit context graph in public beta, Governance for Agents in private beta, and GitLab Flex.
The Source Code Management and Orbit capabilities address limitations that users in Git-based workflows encounter due to larger codebases managed by software teams and the growing volume of automated activity.
Meanwhile, the Governance for Agents extends that foundation with new AI auditing and control capabilities to meet compliance requirements, while GitLab Flex allows monthly reallocation across seats and credits without contract amendments.
Cantor Fitzgerald said the feature has the ability to accelerate enterprise adoption as organizations remain uncertain about agent consumption patterns.
Earlier on June 10, BTIG analyst Nick Altmann reiterated a Buy rating on Gitlab, according to a report by TipRanks. Based on 30 analyst ratings compiled by CNN, 63% assigned a Hold rating to GitLab, while 30% assigned a Buy rating. The stock has a median price target of $32, a 13.03% upside from the current price of $28.31.
GitLab Inc. provides an intelligent development, security, and operations (DevSecOps) platform for software innovation.
7. Datadog, Inc. (NASDAQ:DDOG)
Potential Upside: 0.96%
Number of Hedge Fund Holders: 80
Datadog, Inc. (NASDAQ:DDOG) is one of the 8 Best Generative AI Software Stocks to Buy in June 2026. On June 15, Truist analyst Miller Jump upgraded Datadog’s rating to Buy from Hold while raising its price target to $300 from $190, according to a report by Investing.com.
The analyst attributed the upgraded rating and price target to the company’s potential for durable AI-driven growth as well as improved stability of the firm’s relationships with frontier lab customers.
“Despite increased awareness around AI consumption, we believe urgency of AI adoption in the enterprise is significantly outweighing the urgency to optimize AI, and customers remain early in their agentic journeys,” Jump was quoted saying in the report.
Several analysts recently raised their price targets on Datadog, such as BMO Capital, which increased its price target on Datadog on June 12 to $260 from $220 while maintaining an outperform rating on the shares.
Earlier on June 11, Benchmark increased the firm’s price target on Datadog to $260 from $230 and maintained a Buy rating on the shares after following the company’s DASH 2026 conference in New York City. The analyst cited the company’s efforts to conduct on-the-ground checks and solicit feedback from customers and partners as a positive development.
At its DASH conference on June 9, DataDog launched 100 plus capabilities to support customers in driving autonomy and managing growing AI and security complexities. These include the new Bits AI, log management, and security capabilities.
Datadog, Inc. is an observability and security platform for the AI era. It brings applications, infrastructure, data, models, and security into one place, using AI to detect and resolve issues before they impact customers.
6. Snowflake Inc. (NYSE:SNOW)
Upside Potential: 24.60%
Number of Hedge Fund Holders: 80
Snowflake Inc. (NYSE:SNOW) is one of the 8 Best Generative AI Software Stocks to Buy in June 2026. On June 12, Snowflake Ventures, the company’s corporate venture arm, announced that it is investing in Jedify, an autonomous context graph for data-intensive agentic applications and workflows.
The venture company said the investment in Jedify aims to advance the semantic foundation for enterprise AI. It added that the investment reflects Snowflake’s view that governed semantic context is transforming into foundational infrastructure for enterprise AI.
As part of the investment, Snowflake noted that Jedify can support customers in accelerating the adoption of Snowflake’s AI capabilities while reinforcing the broader Open Semantic Interchange (OSI) ecosystem.
Earlier on June 5, Truist increased its price target on Snowflake to $300 from $275 while maintaining a Buy rating on the shares, highlighting its Cortex Code (CoCo), which is accelerating workload creation, migrations, and platform expansion.
Out of 52 analyst ratings compiled by CNN, 87% placed a Buy rating on Snowflake, while 11% rated the stock Hold. The stock has a median price target of $300, a 24.60% upside from the current price of $240.78.
Snowflake Inc. provides cloud data warehousing software to enterprise clients. The company’s AI Data Cloud platform allows clients to build, use, and share data, applications, and AI.
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5. Cloudflare, Inc. (NYSE:NET)
Potential Upside: 10.31%
Number of Hedge Fund Holders:84
Cloudflare, Inc. (NYSE:NET) is one of the 8 Best Generative AI Software Stocks to Buy in June. On June 15, Investing.com reported that Citizens maintained its Market Outperform rating on Cloudflare with a $270.00 price target, following the company’s Investor Day presentation on June 9.
Earlier on June 11, Truist increased the price target on Cloudflare to $250 from $225 while maintaining a Buy rating on the stock. The analyst sees the company evolving from an edge security and content delivery network provider to a unified platform that covers security, network services, developer tools, and AI-related workloads.
Similarly, UBS also raised its price target on Cloudflare to $250 from $220 following the company’s Investor Day presentation. The analyst maintained a Neutral rating on the stock as it noted the firm’s margin outlook and AI positioning. Additionally, TD Cowen reiterated its Buy rating on Cloudflare with a $265 price target, highlighting the company’s role in securing AI agents through its cloud-native architecture.
Earlier this month, Cloudflare announced the acquisition of JavaScript tooling company VoidZero in a bid to build the future of AI-native web. The company said the acquisition will unify VoidZero’s high-performance tooling into the Cloudflare ecosystem. It added:
“By merging Cloudflare’s global edge network and Workers developer platform with the modern web’s industry-standard toolchain, Cloudflare is creating a frictionless, one-click deployment stack from local code straight to Cloudflare’s global network.”
Cloudflare, Inc. is a global cloud services provider that delivers a broad range of services to businesses. The company’s connectivity cloud delivers a unified platform of cloud-native products and developer tools.
4. Adobe Inc. (NASDAQ:ADBE)
Potential Upside: 21.15%
Number of Hedge Fund Holders: 86
Adobe Inc. (NASDAQ:ADBE) is one of the 8 Best Generative AI Software Stocks to Buy in June. On June 12, TheFly reported that Freedom Broker analyst Egor Tolmachev downgraded Adobe to Hold from Buy, reducing its price target to $250 from $510 following the company’s second-quarter earnings report.
The analyst noted a shift in the quality of the company’s growth during the quarter as the acceleration was acquired rather than organic, adding that the management is deliberately trading near-term subscription revenue for top-of-funnel reach.
Similarly, UBS reduced its price target on Adobe to $225 from $260 while keeping a Neutral rating on the stock due to concerns about pricing power, according to a report by Investing.com. The analyst emphasized that creative AI technology has impaired the company’s pricing power in the down-market and individual customer segment, describing it as a major dent to the company’s narrative.
According to a Wall Street Journal report, Adobe plans to focus on its “freemium” artificial-intelligence offerings to grow its user base and drive adoption of its AI products.
For the second quarter of its fiscal year 2026, Adobe achieved record revenue of $6.62 billion, a 13% increase from the $5.87 billion registered in the same period last year. GAAP net income during the period amounted to $1.71 billion, while non-GAAP net income registered at $2.40 billion.
Adobe Inc. is a global technology firm that provides creativity and productivity-focused platforms and tools for both businesses and individuals.
3. Salesforce (NYSE:CRM)
Upside Potential: 47.07%
Number of Hedge Fund Holders: 101
Salesforce (NYSE:CRM) is one of the 8 Best Generative AI Software Stocks to Buy in June. On June 15, Salesforce announced that it had forged a definitive agreement for the acquisition of customer agent company Fin, formerly Intercom, for approximately $3.6 billion.
Salesforce said the acquisition will bring Fin’s customer agent platform to companies of all sizes, expanding the company’s ability to deliver autonomous agents across the enterprise. Upon the completion of the transaction, Salesforce and Fin customers will be provided with more ways to deploy AI agents across their customer service operations, with fast time-to-value options. The company said this is especially well-suited for SMB and some commercial organizations that need to launch quickly, integrate with existing systems, and deliver measurable outcomes.
According to a report by TheFly on the same day, Jefferies expressed optimism for the acquisition, noting that it will accelerate AI adoption in Salesforce’s installed base. The analyst noted that 15 M&A deals signed by Salesforce since May 2025 are helping accelerate innovation, as the company looks to reinvent itself amid the AI displacement narratives.
Several analysts reiterated their Buy ratings on Salesforce following the announcement of the acquisition. According to a separate report from Investing.com, Canaccord Genuity maintained its Buy rating and $225 price target on Salesforce on June 15. Similarly, Truist also maintained a Buy rating and $280 price target on the stock.
Based on 55 analyst ratings compiled by CNN, 73% assigned a Buy rating to Salesforce, while 24% assigned a Hold rating. The stock currently has an average price target of $242, a 47.07% upside from the current price of $164.55.
Salesforce helps organizations become agentic enterprises by integrating humans, agents, apps, and data on a trusted, unified platform to unlock unprecedented growth and innovation.
2. Intuit Inc. (NASDAQ:INTU)
Potential Upside:58.46%
Number of Hedge Fund Holders: 103
Intuit Inc. (NASDAQ:INTU) is one of the 8 Best Generative AI Software Stocks to Buy in June. In a filing to the Securities and Exchange Commission on June 11, Intuit announced that it has raised approximately $1.74 billion from the issuance of senior notes worth $1.75 billion.
The issuance is composed of $750 million 4.950% Senior Notes due 2031 and $1 billion worth of 5.500% Senior Notes due 2036. The company said it intends to use the net proceeds for general corporate purposes, which may include refinancing its $750 million aggregate principal amount of 5.250% Senior Notes due 2026 and its $500 million aggregate principal amount of 1.350% Senior Notes due 2027.
In other news, Goldman Sachs analyst Gabriela Borges earlier downgraded the rating on Intuit to Sell from Neutral on June 2, lowering its price target to $276 from $519, according to a report by TheFly. The analyst said consensus estimates are likely too high for the next three years, noting that the company may have to revise its long-term growth targets downward.
For the third quarter of its fiscal year 2026, Intuit reported a 10% rise in total revenues to $8.6 billion. The company expects revenues of $21.341 billion to $21.374 billion, growth of approximately 13% to 14% for its full fiscal year.
Based on 34 analyst ratings compiled by CNN, Intuit has a median price target of $446.50, a 58.46% upside from the current price of $281.77.
Intuit Inc. is a global financial technology platform. It has approximately 100 million customers worldwide using products such as TurboTax, Credit Karma, QuickBooks, Mailchimp, and Intuit Enterprise Suite.
1. ServiceNow (NYSE:NOW)
Potential Upside: 29.62%
Number of Hedge Fund Holders: 108
ServiceNow (NYSE:NOW) is one of the 8 Best Generative AI Software Stocks to Buy in June. Based on 50 analyst ratings compiled by CNN, 90% assigned a Buy rating to ServiceNow, while 8% assigned a Hold rating. The stock has an average price target of $135, a 29.62% upside from the current price of $104.15.
On June 15, TheFly reported that Benchmark analyst Yi Fu Lee increased the price target on ServiceNow to $130 from $125 while maintaining a Buy rating on the stock.
The analyst expressed optimism for the stock following a fireside chat with the company’s Head of Investor Relations and Market Insights, Darren Yip. Lee said he “walked away feeling bullish on one of the cleanest operating models in the SaaS sector balancing profitable growth.”
Last week, ServiceNow announced the expansion of its collaboration with IBM, which seeks to unlock enterprise data for AI at scale. The expanded partnership combines IBM’s AI, data, and automation capabilities with the ServiceNow AI Platform to help enterprises break through outdated systems and put their data to work for AI.
The two companies will deliver joint solutions that modernize aging systems, extend ServiceNow Workflow Data Fabric with IBM’s enterprise data capabilities, and enable autonomous IT operations so the world’s largest enterprises can unlock the transformative value of agentic AI.
ServiceNow provides an end-to-end workflow automation platform for digital businesses. The ServiceNow AI Platform integrates with any cloud, any model, and any data source to orchestrate how work flows across the enterprise.
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