OpenAI of ChatGPT fame has emerged as the poster child of the AI revolution. The AI models behind the famous AI assistant have, however, started to attract unwanted attention in recent months. For example, news publication The Guardian has reported that a group of major news organizations in Canada have sued the AI firm for allegedly strip-mining journalism and unjustly enriching itself by using news articles to train the popular ChatGPT software. Per the report, the suit was filed in the superior court of justice in Ontario and calls for punitive damages, a share of profits made by OpenAI from using the articles, and an injunction barring the San Francisco-based company from using any of the news articles in the future.
Read more about these developments by accessing 10 Best AI Data Center Stocks and 10 Buzzing AI Stocks According to Goldman Sachs.
OpenAI has faced similar suits in recent months but has managed to fight back without incurring financial harm. The latest suit, per the report, includes news platforms like the Globe and Mail, the Canadian Press, the CBC, the Toronto Star, Metroland Media, and Postmedia. The companies want up to C$20,000 in damages for each article used by OpenAI, suggesting a victory in court could be worth billions. As it battles these claims, OpenAI has already signed licensing agreements with a handful of media organizations, including the Associated Press wire service, NewsCorp and Condé Nast.
Read more about these developments by accessing 30 Most Important AI Stocks According to BlackRock and Beyond the Tech Giants: 35 Non-Tech AI Opportunities.
For this article, we selected AI stocks by combing through news articles, stock analysis, and press releases. These stocks are also popular among hedge funds. 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 275% since May 2014, beating its benchmark by 150 percentage points (see more details here).
A data center filled with the latest servers and networking equipment representing the company’s cutting edge security infrastructure.
AI News Updates That Analysts Are Monitoring
9. Evolv Technologies Holdings, Inc. (NASDAQ:EVLV)
Number of Hedge Fund Holders: 18
Evolv Technologies Holdings, Inc. (NASDAQ:EVLV) provides artificial intelligence-based weapons detection for security screening in the United States and internationally. The company recently announced that it had resolved an FTC inquiry into certain aspects of the prior marketing claims of the firm. Per the company, there are no financial penalties or other monetary relief associated with the announcement. However, as part of the resolution, approximately 237 Evolv Express units of certain customers could be impacted, it said.
8. Dell Technologies Inc. (NYSE:DELL)
Number of Hedge Fund Holders: 60
Dell Technologies Inc. (NYSE:DELL) designs, develops, manufactures, markets, sells, and supports various comprehensive and integrated solutions, products, and services. Pat Gelsinger, the CEO of Intel, recently visited the AI data center of startup xAI. During his visit, the CEO praised the development of the data center in a short period of time and lauded Michael Dell, the founder and CEO of Dell Technologies and the current provider of xAI’s head node servers, for the engineering feat behind the buildup. There are reports that xAI is tapping Dell for AI servers following legal troubles at rival Supermicro.
7. Intel Corporation (NASDAQ:INTC)
Number of Hedge Fund Holders: 68
Intel Corporation (NASDAQ:INTC) markets key technologies for smart devices. The financial struggles of the chipmaker are in the spotlight yet again as a report from Business Insider showed that Intel’s median employee pay has only increased by 4% over the past five years, per an analysis of annual proxy statements filed with the SEC, compared to rivals like NVIDIA, AMD, and QUALCOMM that have boosted their average pay by at least 12% during the time. As the company rebrands for the AI era, it recently cut about 15% of its employees through voluntary buyouts and layoffs and slashed staff perks.
6. Advanced Micro Devices, Inc. (NASDAQ:AMD)
Number of Hedge Fund Holders: 107
Advanced Micro Devices, Inc. (NASDAQ:AMD) operates as a semiconductor manufacturer. The company has been in a competition with NVIDIA in the AI chip race. So far, NVIDIA has managed to stay ahead of AMD. However, the tide appears to be changing. Latest analysis from investment advisory Trefis suggests that a variety of factors are coming together to boost the long-term growth potential of AMD compared to NVIDIA. These include reception among major companies, exemplified by a recent announcement by infotech firm IBB to feature AMD MI300X AI processors on its cloud services by 2025, as well as the changing economic climate where cost efficiency is becoming more pivotal for businesses. Per the report, with NVIDIA GPUs often priced above $25,000, firms are actively seeking alternatives. To support this claim, the advisory referenced Oracle’s selection of AMD chips for its AI supercluster, fueled by pricing competitiveness alongside solid performance metrics.
5. Alphabet Inc. (NASDAQ:GOOG)
Number of Hedge Fund Holders: 160
Alphabet Inc. (NASDAQ:GOOG) is a California-based technology company that owns and runs the internet search engine Google. On November 30, news platform Business Today reported that scientists at DeepMind, an AI research laboratory backed by Google, had developed an artificial intelligence system capable of building accurate digital personality replicas. Per the report, the system uses advanced AI to analyze responses in real time, generating models that can mimic thought processes, decision-making, and reactions with 85% accuracy.
4. NVIDIA Corporation (NASDAQ:NVDA)
Number of Hedge Fund Holders: 193
NVIDIA Corporation (NASDAQ:NVDA) provides graphics, computing and networking solutions. On November 29, news agency Reuters reported that TSM founder Morris Chang once offered NVIDIA Chief Executive Officer Jensen Huang the chance to run the global semiconductor foundry. Per the report, Huang turned down the job. Chang made the revelation in a memoir that will be released soon. The report further added that Chang sought to lure Huang to TSM because of his character, professional experience and expertise in the semiconductor industry.
3. Meta Platforms, Inc. (NASDAQ:META)
Number of Hedge Fund Holders: 235
Meta Platforms, Inc. (NASDAQ:META) engages in the development of products that enable people to connect and share with friends and family. Latest reports, published by tech news platform TechCrunch, claim that as the AI business of the company takes off, it is planning to build build a new, major, fibre-optic subsea cable extending around the world — a 40,000+ kilometer project that could total more than $10 billion of investment. Per the report, Meta will be the sole owner and user of this subsea cable — a first for the company and thus representing a milestone for its infrastructure efforts.
2. Microsoft Corporation (NASDAQ:MSFT)
Number of Hedge Fund Holders: 279
Microsoft Corporation (NASDAQ:MSFT) is a Washington-based technology company. On November 28, Wedbush analyst Daniel Ives kept an Outperform rating on Microsoft with a $550 price target after Bloomberg reported the Federal Trade Commission opened an antitrust investigation into the company. Per Ives, the FTC suit is much more bark than bite and ultimately will fade into the background once a new FTC chair is likely named by Trump for January. Wedbush believes the big technology companies will ultimately emerge from the DOJ’s legal challenges with some scrapes and bruises, but nothing more concerning that disrupts the bullish tech trade and AI Revolution thesis into 2025 and beyond.
1. Amazon.com, Inc. (NASDAQ:AMZN)
Number of Hedge Fund Holders: 286
Amazon.com, Inc. (NASDAQ:AMZN) operates as a technology conglomerate with core interests in the ecommerce business. On November 29, news platform CNBC reported that Amazon was using generative AI to drive more same-day shipping as the holiday season got into full swing. Per the news platform, AI was helping the tech giant make use of smarter robots and better routes for this purpose. In recent years, the company has been at the forefront of shortening package delivery timelines. The same-day delivery that the firm champions is now the standard across the industry.
While we acknowledge the potential of Amazon.com, Inc. (NASDAQ:AMZN) as an investment, our conviction lies in the belief that some AI stocks hold greater promise for delivering higher returns, and doing so within a shorter timeframe. If you are looking for an AI stock that is more promising than Amazon.com, Inc. (NASDAQ:AMZN) but that trades at less than 5 times its earnings, check out our report about the cheapest AI stock.
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