We recently published a list of the 11 Best Young Stocks to Buy According to Hedge Funds. In this article, we are going to take a look at where Core Scientific, Inc. (NASDAQ:CORZ) stands against other best young stocks.
NASDAQ CEO and chair Adena Friedman appeared on CNBC’s ‘Squawk Box’ on April 24 to discuss what to make of the market volatility, as well as the IPO landscape. Friedman reported that NASDAQ achieved 12.5% overall revenue growth in the quarter, with every division posting double-digit increases. Specifically, the index business grew by 26%, which was supported by $27 billion of inflows during the quarter. Half of these inflows were directed into NASDAQ 100 index products, while the other half went into various other indexes offered by NASDAQ. Friedman also acknowledged that the economy entered the year with resilience but faced increasing uncertainty and volatility as the quarter progressed. However, she explained that such environments often drive clients to turn to NASDAQ as the market operator of choice to manage their trading volumes and capital flows. She noted that even amid market value fluctuations, NASDAQ saw inflows into its index products and strong demand for its fintech services.
The discussion also indicated that while short-term market volatility can boost trading activity and liquidity, longer-term IPO prospects depend on broader economic conditions. Friedman said that IPO activity and investor behavior could change more significantly if the economy were to enter an extended recession. But for now, NASDAQ benefits from a strong start to the year and remains a preferred venue for investors to express their views. The conversation then turned to global capital flows, particularly as Chinese sovereign wealth funds may reduce investments in US venture capital and private equity firms. Friedman stated that the capital flows where returns are the strongest. She emphasized that asset owners and managers have ‘fiduciary’ responsibilities to their ultimate beneficiaries and will prioritize returns over the long term. Acknowledging the influence of geopolitical and political factors on investment decisions, Friedman stressed that NASDAQ’s role is to provide the infrastructure that allows capital to flow efficiently regardless of shifts.
Our Methodology
We first used the Finviz stock screener to compile a list of young stocks that went public in the last 3 years. We then selected the 11 stocks that were the most popular among elite hedge funds and that analysts were bullish on. The stocks are ranked in ascending order of the number of hedge funds that have stakes in them, as of Q4 2024.
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).
An aerial view of a modern data center, its server racks humming with activity.
Core Scientific, Inc. (NASDAQ:CORZ)
Number of Hedge Fund Holders: 66
Core Scientific, Inc. (NASDAQ:CORZ) is a digital asset mining company that offers infrastructure, software, and hosting solutions across the US. It operates through self-mining, hosted mining, and HPC hosting segments. It provides data center facilities, miner deployment & management, and essential infrastructure services to support blockchain transactions and digital asset operations.
On May 8, H.C. Wainwright analyst Kevin Dede maintained a Buy rating on Core Scientific with a $17 price target. The strategy centers on the company’s high-density co-location business, which is driven by its contracts with CoreWeave. These agreements are structured as take-or-pay and fixed-price contracts, which ensure a consistent revenue stream regardless of utilization. CoreWeave is funding the majority of CapEx for these deployments.
This model allows Core Scientific (NASDAQ:CORZ) to maintain a light balance sheet, with its direct capital outlay on the largest 70-megawatt expansion being $104 million. The company expects to deliver 250 megawatts to CoreWeave by the end of 2025 and 590 megawatts by early 2027. It’s also building out 570 megawatts of billable capacity across 4 locations. The Denton, Texas, facility is projected to deliver 260 megawatts of buildable capacity and potentially host one of North America’s largest GPU clusters.
Overall, CORZ ranks 4th on our list of the best young stocks to buy according to hedge funds. While we acknowledge the growth potential of CORZ, our conviction lies in the belief that AI stocks hold great promise for delivering high 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 CORZ 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.