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DA Davidson Names Meta Platforms, Inc. (META) a Top Mega-Cap Pick

We recently compiled a list of the 20 Trending AI Stocks on Latest News and Analyst Ratings. In this article, we are going to take a look at where Meta Platforms, Inc. (NASDAQ:META) stands against the other trending AI stocks.

The latest trends in AI stocks reflect optimism about the future of AI technology, with companies like NVIDIA continuing to dominate the space. The stock price of the chipmaker that is famous for selling AI GPUs has surged significantly in the past two years. After tripling in 2023, NVIDIA shares are up another 140% in 2024, pushing the market valuation of the firm close to $3 trillion. Analysts, like those at Bank of America, have increased their price target on the shares to around $1,500, citing the potential of NVIDIA to drive AI growth for years to come. Bank of America analysts believe the conversion of global data centers to AI-accelerated computing could require up to $500 billion annually, with NVIDIA playing a key role in this transformation​.

Read more about these developments by accessing 30 Most Important AI Stocks According to BlackRock and AI News You Should Not Have Missed.

Prominent investment firms appreciate the significance of emerging AI trends. According to a report by Financial Times, investment titan Blackrock is exploring the launch of an AI-focused fund, in collaboration with tech powerhouse Microsoft and MGX, an investment firm based in Abu Dhabi. The primary aims of this fund are likely to include focus on creating data centers and funding energy infrastructure to support AI growth. NVIDIA is assisting Blackrock with estimating energy demands for new AI technologies. Analysts have forecast that energy constraints could be a potential roadblock to faster AI adoption. BlackRock will launch the fund with Global Infrastructure Partners, a firm it bought back in January for $12.5 billion.

The AI hype is truly global. Tech giant Amazon recently announced that it would invest £8 billion in the United Kingdom over the next five years as part of a major push to expand data center infrastructure across the country. Amazon rivals like Google and Microsoft have also previously announced plans to boost data center infrastructure in the UK. The former plans to invest $1 billion in the UK while the latter has confirmed around £2.5 billion to expand AI growth. Experts have stressed that AI is not just a short-term trend but a long-term transformative force. Francisco Bido, a top portfolio manager, recently underlined that AI was not a fad, noting the significant impact it had on both the top and bottom lines of many companies.

Read more about these developments by accessing 33 Most Important AI Companies You Should Pay Attention To and 20 Industrial Stocks Already Riding the AI Wave.

Our Methodology

For this article, we selected AI stocks based on the latest news and analyst ratings. 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 team of developers working in unison to create the company’s messaging application.

Meta Platforms, Inc. (NASDAQ:META)

Number of Hedge Fund Holders: 219

Meta Platforms, Inc. (NASDAQ:META) engages in the development of products that enable people to connect and share with friends and family through mobile devices, personal computers, virtual reality headsets, and wearables worldwide. Investment advisors at DA Davidson recently initiated coverage of the stock with a Buy rating and listed it as a top pick within the mega-cap space. In an investor note, analysts at the advisory underlined that Meta had set itself up to be the open source leader for the next two major technology platforms — AI Foundation Compute and Spatial Compute.

The analysts added that Meta Platforms, Inc. (NASDAQ:META) has the pole position on the open source side of the AI world, while other tech giants like Alphabet, Apple, Amazon, and Microsoft were crowding into the closed garden side of AI platforms. The research firm said unlike previous tech innovations, the aforementioned future platforms could only be won by a megacap and praised the choice of Meta to open source AI compute elements.

Overall META ranks 4th on our list of the trending AI stocks to buy. While we acknowledge the potential of META 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 META but that trades at less than 5 times its earnings, check out our report about the cheapest AI stock.

READ NEXT: Michael Burry Is Selling These Stocks and Jim Cramer is Recommending These Stocks.

Disclosure: None. This article is originally published at Insider Monkey.

The $250 Trillion AI Hype is Real. A few years from now, you’ll probably wish you’d bought this stock.

When Jeff Bezos said that one breakthrough technology would shape Amazon’s destiny, even Wall Street’s biggest analysts were caught off guard.

Fast forward a year and Amazon’s new CEO Andy Jassy described generative AI as a “once-in-a-lifetime” technology that is already being used across Amazon to reinvent customer experiences.

At the 8th Future Investment Initiative conference, Elon Musk predicted that by 2040 there would be at least 10 billion humanoid robots, with each priced between $20,000 and $25,000.

Do the math. According to Musk, this technology could be worth $250 trillion by 2040.

Put another way, that’s roughly equal to:

  • 175 Teslas
  • 107 Amazons
  • 140 Metas
  • 84 Googles
  • 65 Microsofts
  • And 55 Nvidias

And here’s the wild part — this $250 trillion wave isn’t tied to one company, but to an entire ecosystem of AI innovators set to reshape the global economy.

It’s a leap so massive, it could reshape how businesses, governments, and consumers operate worldwide.

Even if that $250 trillion figure sounds ambitious, major firms like PwC and McKinsey still see AI unlocking multi-trillion-dollar potential.

How could anything be worth that much?

The answer lies in a breakthrough so powerful it’s redefining how humanity works, learns, and creates.

And this breakthrough has already set off a frenzy among hedge funds and Wall Street’s top investors.

What most investors don’t realize is that one under-owned company holds the key to this $250 trillion revolution.

In fact, Verge argues this company’s supercheap AI technology should concern rivals.

Before I reveal the details, let’s talk about how some of the richest people on the planet are positioning themselves.

  • Bill Gates sees artificial intelligence as the “biggest technological advance in my lifetime,” more transformative than the internet or personal computer, capable of improving healthcare, education, and addressing climate change.
  • Larry Ellison — through Oracle, is spending billions on Nvidia chips and partnering with Cohere to embed generative AI across Oracle’s cloud and apps.
  • Warren Buffett — not known for tech hype — says this breakthrough could have a ‘hugely beneficial social impact.

When billionaires from Silicon Valley to Wall Street line up behind the same idea — you know it’s worth paying attention to.

Even as we admire what Tesla, Nvidia, Alphabet, and Microsoft have built, we believe an even greater opportunity lies elsewhere…

But the real story isn’t Nvidia — it’s a much smaller company quietly improving the critical technology that makes this entire revolution possible.

And judging by what I’m hearing from both Silicon Valley insiders and Wall Street veterans…

This prediction might not be bold at all:

A few years from now, you’ll wish you’d owned this stock.

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