We recently published a list of 13 Best AI Stocks to Buy Under $10. In this article, we are going to take a look at where BigBear.ai Holdings, Inc. (NYSE:BBAI) stands against other best AI stocks to buy under $10.
Fears of an artificial intelligence bubble bursting appear overblown. That’s the sentiment echoed on Wall Street in the aftermath of tech giants delivering better-than-expected quarterly results and reiterating investments in AI infrastructure. Increased investments in AI Infrastructure and other solutions have once again affirmed sentiments in the burgeoning segment that was the catalyst behind US markets powering to record levels last year.
At the beginning of the year, investors became worried that the AI surge might collapse in the aftermath of the Chinese company DeepSeek creating a sophisticated large language model that needed less energy and funding. The news from DeepSeek caused a significant change in market sentiment and led to a decline in AI stocks that had experienced substantial increases for most of the year.
Fast forward, tech giants signaling they will continue to invest in AI and cloud infrastructure is a tailwind that continues to reiterate sentiments around AI stocks. Companies ramping up investments to address capacity constraints in their cloud unit, as others ramp investments in AI-powered servers and data center assets, are a positive for the overall sector.
According to AMD CEO Lisa Su, ordering patterns around everything AI remains strong, signaling people and companies are not making short-term decisions. Initially, there were concerns that companies pursuing opportunities around AI had spent far too much and too quickly to build out infrastructure and would need to go slow. Consequently, tech giants whose valuations had skyrocketed to record highs pulled back significantly as investors remained wary of their long-term outlook amid an uncertain macroeconomic environment that is crumbling amid a ferocious trade war and export controls.
Continued investments in AI should be expected as companies look to strengthen their product and services portfolio while also strengthening their competitive edge. There have been concerns that heightened regulations and authorities placing guardrails could derail innovations around artificial intelligence. However, that appears not to be the case.
According to Wedbush Securities global head of technology research Dan Ives, “Innovations around AI are growing at 100 miles per hour while regulatory pressure is only growing at 35 miles an hour”.
According to Ives no amount of regulation is going to change the heightened amount of spending around AI. “The use cases are exploding and no amount of regulation is going to change it” said Ives in an interview with CNBC. Ives added:
“In terms of use cases, US commercial businesses are exploding. Right now we have 85 use cases, a year ago we had 10. I think what we are starting to see is more and more that it is across verticals healthcare financials government and retail among others.”
The fact that executives from some of the biggest tech giants have denied they are cutting back spending on servers and data makes the case for why investors should pay attention to some of the AI stocks trading at highly discounted valuations.
Our Methodology
We sifted through Finviz and financial media reports to compile a list of top AI stocks trading below $10. We then selected the 13 stocks that were the most popular among elite hedge funds and that analysts were bullish on. The stocks are ranked in ascending order based on the number of hedge funds that have stakes in them, as of Q4 2024. The hedge fund data was sourced from Insider Monkey’s database, which tracks the moves of over 900 elite money managers.
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 373.4% since May 2014, beating its benchmark by 218 percentage points (see more details here).
A closeup of a computer server rack surrounded by a CAT5 network of cables.
BigBear.ai Holdings, Inc. (NYSE:BBAI)
Stock Price as of May 12: $3.16
Number of Hedge Fund Holders: 13
BigBear.ai Holdings, Inc. (NYSE:BBAI) is a technology company that offers artificial intelligence-powered decision intelligence solutions. It also helps organizations operationalize AI by analyzing complex data and providing actionable insights in national security, supply chain management, and digital identity. Likewise, it is one of the best AI stocks to buy, with solid financial results that underscore underlying growth.
BigBear.ai Holdings, Inc. (NYSE:BBAI) delivered solid first-quarter results with a 5% revenue growth of $34.8 million. In addition, its net loss shrank by more than half to $62 million compared to a net loss of $127.8 million delivered the same quarter last year. The better-than-expected results come from BigBear.ai Holdings solutions, resonating well with the sectors for which they were built.
For starters, BigBear.ai Holdings, Inc. (NYSE:BBAI) has inked a strategic partnership with Hardy Dynamics to integrate AI and machine learning into a drone swarm for the US Army. The army-funded project signals strong interest in the company’s ConductorOS platform, which enables secure AI-powered coordination among unmanned aerial systems. Therefore, it places the company at the forefront of AI integrations in military operations, which is expected to unlock new growth opportunities. However, on May 2, Cantor Fitzgerald cut BigBear.ai Holdings, Inc.’s (NYSE:BBAI) price target from $6.00 to $5.00 but kept an Overweight rating, citing macroeconomic concerns.
Overall, BBAI ranks 10th on our list of best AI stocks to buy under $10. While we acknowledge the potential of BBAI as an investment, our conviction lies in the belief that AI stocks hold greater promise for delivering higher returns and doing so within a shorter time frame. There is an AI stock that went up since the beginning of 2025, while popular AI stocks lost around 25%. If you are looking for an AI stock that is more promising than BBAI but that trades at less than 5 times its earnings check out our report about this cheapest AI stock.
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Disclosure: None. This article is originally published at Insider Monkey.