In this article, we will discuss The Next SanDisk: 9 Potential Breakout AI Stocks You Shouldn’t Miss.
It’s been months, if not years, since bears started warning that the AI bubble was about to burst. Yet AI spending continues to surge, new AI use cases keep emerging, and a growing number of companies are entering the space. Recent IPOs have also brought fresh names into the spotlight.
Many investors believe the AI rally still has years of runway as companies continue pouring billions into AI infrastructure and applications.
Bank of America’s latest monthly survey of fund managers found that about 56% of respondents believe the AI trade remains in the “boom” stage, where strong momentum and fear of missing out continue to attract investors. Only 21% said the sector has entered the “euphoria” stage, when valuations become excessively stretched and speculative.
Jim Lebenthal, Partner and Chief Market Strategist at Cerity Partners, recently said on a program on CNBC that investors should welcome the market broadening into other under-the-radar AI names amid new IPOs. He believes there are no signs that the current bull run will end anytime soon and says investors need to look for new names to continue making money from the AI rally.
“There’s no reason that I can see to think that there’s going to be a correction anytime soon, whether it’s the market overall or semiconductors or technology,” Lebenthal said. “I want everybody to consider if you, as most of us have some of these parabolas in your portfolio, it is a good time to do some risk management, not sell the entire thing, but trim some and go into other areas.”
SanDisk soared 4,600% in the past year. And for some, it was not a surprise. Wise investors spotted long before Wall Street caught on. The reason is simple: when AI data centers exploded, they needed massive amounts of memory storage. SanDisk makes the chips. Their factories were already maxed out. Supply couldn’t meet demand. So they raised prices. A lot. Profit margins went through the roof. Stock went with them.
The real question investors are asking now: What’s the next SanDisk? Which company owns a critical bottleneck that AI infrastructure can’t live without?
For this article, we reviewed extensive Reddit discussions, including long threads on potential next breakout stocks like SanDisk, and selected names that users broadly agree have strong long-term catalysts and breakout potential, excluding meme stocks. With eack stock we have also mentioned its hedge fund sentiment. 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).
9. Cerebras Systems (NASDAQ:CBRS)
Number of Hedge Fund Investors: N/A
Cerebras Systems (NASDAQ:CBRS) is an AI chipmaker that sells Wafer-Scale Engine (WSE-3) processors. Its customers are OpenAI and Amazon Web Services, with potential for enterprise customers down the line.
Wall Street turned bullish on the company because it makes the industry’s only commercially deployed wafer-scale AI chip. Bulls point to the company’s massive $24.6 billion backlog, which is 48 times Cerebras Systems (NASDAQ:CBRS) FY25 revenue of $510 million. The backlog is supported by a $20 billion three-year deal with OpenAI announced in January 2026. In that deal, OpenAI will deploy approximately 750 megawatts of Cerebras compute capacity through 2028, with an option for an additional 1.25 gigawatts. The company also has a collaboration with AWS for disaggregated inference announced in March 2026.
Cerebras Systems (NASDAQ:CBRS) expects revenue growth with a 120% forward topline CAGR through fiscal 2028 from fiscal 2025. This is based entirely on the OpenAI and AWS commitments. Morgan Stanley recently started coverage of the stock with a $250 price target and called it one of the most differentiated AI infrastructure companies with a first-mover advantage against Nvidia. UBS came out with a $300 price target and a Buy rating. Needham also came out with $300 and a Buy rating.
The main risk is concentration. Most of the backlog depends on OpenAI. If OpenAI changes strategy or builds its own chip, Cerebras Systems (NASDAQ:CBRS) gets hurt bad. The WSE-3 also has memory scaling limitations that could prevent it from reaching enterprise customers who want flexible GPU setups. But right now, for fast inference and token generation, the stock has real demand backing it.
8. NETLIST (OTC:NLST)
Number of Hedge Fund Investors: N/A
NETLIST (OTC:NLST) is a small-cap memory company that has caught the attention of retail investors who believe it could become the next major breakout story, similar to how SanDisk was perceived years ago. The company designs, manufactures, and sells high-performance memory subsystems for AI data centers, HPC environments, and enterprise applications. Its primary customers are the hyperscalers desperate for memory in their AI infrastructure buildouts, and enterprise data center operators and HPC facilities worldwide.
What makes NETLIST (OTC:NLST) particularly compelling is its portfolio of over 200 patents worldwide related to hybrid memory, storage-class memory, and DDR-related technologies—intellectual property that becomes increasingly valuable as the AI revolution scales.
Why does this patent portfolio matter so much? These patents and the company’s technology are foundational to the infrastructure powering artificial intelligence. As hyperscalers race to build out massive data centers for AI training and deployment, memory bottlenecks have become the critical chokepoint. NETLIST’s (OTC:NLST) patents cover technologies that are essential to solving these bottlenecks.
