CNBC has recently confirmed that artificial intelligence firm Anthropic has closed its latest Series E funding round at a $61.5 billion post-money valuation. Led by Lightspeed Venture Partners, the $3.5 billion round also included investors such as Salesforce Ventures, Cisco Investments, Fidelity Management & Research Co., General Catalyst, D1 Capital Partners and Jane Street.
According to Anthropic, the latest funding shall be used to advance the development of next-generation AI, particularly to “expand its compute capacity, deepen its research in mechanistic interpretability and alignment, and accelerate its international expansion in Asia and Europe.”
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“The latest investment “fuels our development of more intelligent and capable AI systems that expand what humans can achieve” and that “continued advances in scaling across all aspects of model training are powering breakthroughs in intelligence and expertise.”
– Krishna Rao, Anthropic’s CFO, said in a release.
The latest announcement by Anthropic follows the launch of Claude 3.7 Sonnet and Claude Code, with the former being a hybrid reasoning model and the latter being an agentic coding tool. According to Anthropic, its Claude 3.7 Sonnet has set a new high-water mark in coding abilities, setting the stage for developing AI systems that can serve as true collaborators in the future.
It further elaborated how businesses are increasingly turning to Claude to transform their operations. From Thomson Reuters’ tax platform CoCounsel using it to assist tax professionals; to Novo Nordisk leveraging Claude to reduce clinical study report writing; and even powering Amazon’s Alexa+, Anthropic is committed to leveraging artificial intelligence to help advance human progress.
Meanwhile, the Claude Code has been an early product but has been an asset for test-driven development, debugging complex issues, and large-scale refactoring. Anthropic plans to continually improve it based on its usage, with the goal of better understanding how developers use Claude for coding to inform future model improvements.
For this article, we selected AI stocks by going through news articles, stock analysis, and press releases. These stocks are also popular among hedge funds. The hedge fund data is 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).
A financial analyst giving a presentation to a group of investors about annuity insurance.
10. SoundHound AI (NASDAQ:SOUN)
Number of Hedge Fund Holders: 11
SoundHound AI (NASDAQ:SOUN) is a voice artificial intelligence company offering voice AI solutions to businesses. On March 3rd, the stock was revisited by H.C. Wainwright analyst Scott Buck who maintained a “Buy” rating with a $26.00 price target. Buck is optimistic about SoundHound AI based on its fourth-quarter performance, with the company exceeding both revenue and adjusted EBITDA expectations.
This has led to an upward revision in 2025 revenue guidance, reflecting the company’s organic growth potential. The company anticipates significant sales momentum for its AI solutions across various sectors such as automotive, healthcare, and financial services. SoundHound AI also maintains a solid financial position and is managing its balance sheet effectively, further reinforcing a positive outlook for the stock.
9. Bloom Energy Corporation (NYSE:BE)
Number of Hedge Fund Holders: 42
Bloom Energy Corporation (NYSE:BE) develops solid-oxide fuel cell systems for on-site power generation, helping meet the growing energy demands of AI data centers. On February 28, BofA raised the firm’s price target on the stock to $20 from $18 and kept an “Underperform” rating on the shares. The firm discussed how the company has delivered a strong earnings beat.
As KR Sridhar, CEO of Bloom Energy noted, it is becoming the choice of power for large data centers and businesses. However, the firm is concerned because Bloom’s backlogs and orders have disappointed, and it is unclear what will happen to 2025 demand once tax credits expire. The analysts also noted how Bloom Energy has removed MW acceptance and product economics disclosures at a crucial time, noting that these metrics had flaws but signify a lack of transparency.
8. Palantir Technologies Inc. (NASDAQ:PLTR)
Number of Hedge Fund Holders: 64
Palantir Technologies Inc. (NASDAQ:PLTR) is a leading provider of artificial intelligence systems. On March 3rd, Daniel Ives from Wedbush maintained a “Buy” rating on the stock with a price target of $120.00. According to Ives, Palantir is positioned well to gain from Trump’s new cost-cutting measures to streamline government spending. The stock had previously plunged after the Trump administration proposed an 8% annual cut in the US defense budget.
This move potentially hurt the company’s financial health since over 40% of Palantir’s revenue comes from government contracts. As per Ives, despite the belief that defense budget cuts could affect Palantir’s government contracts, the efficiency focus could in turn boost company growth. The analyst highlighted Palantir’s unique software offerings and crucial contract participation, stating that these are unlikely to be impacted. The analysis has since brought relief after the stock plunge.
7. AppLovin Corporation (NASDAQ:APP)
Number of Hedge Fund Holders: 95
AppLovin Corporation (NASDAQ:APP) provides a leading marketing platform powered by AI technology. On February 28, Analyst Mike Hickey of Benchmark Co. reiterated a Buy rating on the stock and retained the price target of $525.00. Highlighting AppLovin’s robust business model and operational transparency, Hickey asserts that the recent claims made by short seller reports that AppLovin has been misrepresenting the benefits of its AI advertising platform are unfounded and fail to reflect the company’s adherence to industry regulations and financial integrity.
AppLovin’s platform complies with App Store and Google Play policies, and its business model is focused on genuine user engagement rather than artificial metrics. Finally, he noted how the company is being audited by a Big Four firm, which reflects on the high standards of financial reporting. Its rapid growth in e-commerce advertising, boosted by AI-driven optimization, reinforced the buy rating on the stock. The firm finally advised investors to view the short reports with skepticism, focusing on AppLovin’s growth potential and established track record instead.
6. Salesforce, Inc. (NYSE:CRM)
Number of Hedge Fund Holders: 116
Salesforce Inc (NYSE:CRM) is a cloud-based CRM company that has gained popularity after the launch of its AI-powered platform called Agentforce. On March 3rd, CMB International Securities analyst Saiyi He maintained a “Buy” rating on the stock and lowered the associated price target to $388.00. According to Saiyi He, Salesforce’s strong financial performance and strategic market positioning have led to the reiterated buy. Total revenue marked a 9% year-over-year increase for the fourth quarter of fiscal year 2025, in line with market expectations.
Moreover, the 20% rise in non-GAAP net income has also surpassed consensus estimates. While it is true that guidance has been conservative, the analyst is optimistic about its potential, particularly due to the robust growth in Data Cloud and AI segments. The analyst further stated how Salesforce’s AI initiatives are anticipated to drive efficiency gains and margin improvements. The increasing adoption of Salesforce’s multi-cloud offerings, together with the solid performance of its Industry Cloud which delivers industry-specific solutions, further boost its growth prospects.
5. Tesla, Inc. (NASDAQ:TSLA)
Number of Hedge Fund Holders: 126
Tesla, Inc. (NASDAQ:TSLA) is an automotive and clean energy company that leverages advanced artificial intelligence in its autonomous driving technology and robotics initiatives. On March 3rd, Morgan Stanley analyst Adam Jonas reiterated an “Overweight” rating and $430.00 price target on the stock. The firm has reinstated the electric-vehicle maker as its top U.S. auto pick, citing that the company’s artificial intelligence and robotics efforts could boost growth even as the car business falters.
It observes that the company is transitioning from an automotive “pure play” to “a highly diversified play on AI and robotics.” Analysts note that Tesla FY25 deliveries could potentially decline year-over-year, thereby “creating an attractive entry point to our preferred embodied AI name.” Its softer auto deliveries are “emblematic of a company in the transition from an automotive ‘pure play’ to a highly diversified play on AI and robotics”.
4. Broadcom Inc. (NASDAQ:AVGO)
Number of Hedge Fund Holders: 161
Broadcom Inc. (NASDAQ:AVGO) is a technology company uniquely positioned in the AI revolution owing to its custom chip offerings and networking assets. On March 3rd, Reuters reported that chip designers Nvidia and Broadcom are running manufacturing tests with Intel, thereby demonstrating early confidence in Intel’s advanced production techniques.
These tests will determine whether the two companies will be committing hundreds of millions of dollars worth of manufacturing contracts to Intel. The two companies are testing Intel’s 18A manufacturing process, a series of technologies and techniques proficient at making advanced artificial intelligence processors and other complex chips. It’s important to note that these tests are ongoing and do not guarantee whether any manufacturing agreement will materialize.
“We don’t comment on specific customers but continue to see strong interest and engagement on Intel 18A across our ecosystem.”
– Intel spokesperson.
3. Apple Inc. (NASDAQ:AAPL)
Number of Hedge Fund Holders: 166
Apple Inc. (NASDAQ:AAPL) is a technology company. One of the biggest analyst calls on March 3rd was for Apple Inc. Wedbush reiterated the stock as “Outperform”, stating that it’s bullish on Apple’s partnership with Alibaba and what it means for China.
“This Alibaba partnership is key to the long-awaited growth catalyst in this region with our estimates that over 100 million of the roughly 200 million iPhones in China are in the window of an upgrade opportunity”.
2. NVIDIA Corporation (NASDAQ:NVDA)
Number of Hedge Fund Holders: 223
NVIDIA Corporation (NASDAQ:NVDA) specializes in AI-driven solutions, offering platforms for data centers, self-driving cars, robotics, and cloud services. One of the biggest analyst calls for March 3rd was for Nvidia Corporation. Bank of America reiterated the stock as “Buy”, stating that the stock remains very attractive.
Despite the buy, Nvidia stock was falling on Monday, losing 4.5% as of noon ET. The drop comes amid the S&P 500 slipping 0.3% and the Nasdaq Composite losing 0.4%. Moreover, a news report published by The Wall Street Journal a day prior has revealed that despite strict US export restrictions, Nvidia’s latest chips are still making their way into China. According to the company, it would “investigate every report of possible diversion and take appropriate action.”
Analysts on Wall Street currently have a consensus “Buy” rating on the stock. The average price target of $175 implies a 51% upside, however, the Street-high target of $236 implies an upside of 103%.
1. Microsoft Corporation (NASDAQ:MSFT)
Number of Hedge Fund Holders: 317
Microsoft Corporation (NASDAQ:MSFT) provides AI-powered cloud, productivity, and business solutions, focusing on efficiency, security, and AI advancements. On March 3rd, the company announced the launch of Microsoft Dragon Copilot, the first AI assistant for clinical workflow that integrates the capabilities from its dictation solution, Dragon Medical One, and ambient listening solution, DAX Copilot, into one tool.
Even though clinician burnout in the U.S. has dropped from 53% in 2023 to 48% in 2024, projections of a shortage of the U.S. workforce make Dragon Medical One an ideal tool to streamline administrative tasks, enhance health care access, and facilitate faster clinical insights. The tool will allow healthcare workers to cut down on their clerical workloads, thereby reducing burnout.
Dragon Copilot is accessible through a mobile app, browser, or desktop, and it can be integrated directly with several different electronic health records. Through the tool, clinicians will be able to draft clinical notes, use natural language to edit, and even prompt further. The company has said that the tool will be generally available in the U.S. and Canada starting in May.
“At Microsoft, we have long believed that AI has the incredible potential to free clinicians from much of the administrative burden in healthcare and enable them to refocus on taking care of patients. With the launch of our new Dragon Copilot, we are introducing the first unified voice AI experience to the market, drawing on our trusted, decades-long expertise that has consistently enhanced provider wellness and improved clinical and financial outcomes for provider organizations and the patients they serve.”
-Joe Petro, corporate vice president of Microsoft Health and Life Sciences Solutions and Platforms.
While we acknowledge the potential of MSFT 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 time frame. If you are looking for an AI stock that is more promising than MSFT but that trades at less than 5 times its earnings, check out our report about the cheapest AI stock.
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