Speaking on CNBC, Dan Ives, Global Head of Technology Research at Wedbush Securities, and Wilma Burdis, Research Analyst at Raymond James, said that AI spending and resilient private credit continue to underpin markets despite volatility and misleading headlines.
The analysts noted how private credit performance remains solid, and that AI infrastructure investments appear to be tracking ahead of expectations even though markets may be experiencing heightened anxiety as investors navigate individual headlines.
Tech megacaps have reinforced this narrative, announcing major increases in capex for 2026. The four hyperscalers now anticipate combined spending of close to $700 billion, a 60% increase from the historic levels reached in 2025.
The most aggressive spending plan has been of Amazon, expected to reach up to $185 billion in capex this year, and Alphabet not so far behind.
Despite concerns around cash flow pressure, analysts have kept their buy recommendations on these stocks. Longbow Asset Management CEO Jake Dollarhide is also bullish, acknowledging how investing in AI means pressuring cash flow while management balances funding and risk.
If you’re going to pour all this money into AI, it’s going to reduce your free cash flow,” Dollarhide said. “Do they have to go to the debt markets or short-term financing to find the optimal mix of equity and debt? Yeah. That’s why CEOs and CFOs are paid what they’re paid.
That said, let’s dive into the top AI stocks in focus on Wall Street.
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 Q3 2025.
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 427.7% since May 2014, beating its benchmark by 264 percentage points (see more details here).
10. CoreWeave, Inc. (NASDAQ:CRWV)
Number of Hedge Fund Holders: 62
Shares of CoreWeave plunged on Friday, February 20, after Morgan Stanley reiterated the stock as Equal Weight with a price target of $99. The investment bank said it is cautious on CRWV ahead of earnings on Feb. 26.
Analyst Keith Weiss cited concerns over the company’s ability to meet ambitious growth targets amid operational delays. Recent legal complaints regarding service shortfalls have further fueled investor skepticism regarding CoreWeave’s capacity to deliver on customer commitments.
According to Weiss, future rating improvements for CRWV will largely depend on significantly scaling power capacity, addressing data center delays, conversion of projects under construction into spending, and growing the backlog and customer base.
CoreWeave has secured and expanded large contracts from the most demanding GenAI users, though easing investor concerns regarding management’s ability to consistently execute on stated goals will require 1) exiting the year with > 850 MW of active power, 2) resolving prior data center delays, and 3) outlining a credible path to securing an additional 5 GW of capacity.
CoreWeave, Inc. (NASDAQ:CRWV) is a cloud platform provider that provides equipment for AI and other computing purposes.
9. Fortinet, Inc. (NASDAQ:FTNT)
Number of Hedge Fund Holders: 62
Despite delivering fourth-quarter 2025 results that exceeded both market expectations and own guidance, Freedom Capital Markets analyst Almas Almaganbetov downgraded Fortinet (NASDAQ: FTNT) from Buy to Hold with a price target of $90.00 on February 17.
The firm flagged valuation constraints for FTNT despite Q4 outperformance, mainly due to margin risks from memory prices, FX volatility, and rising competition. It noted how FTNT’s robust results were propelled by the launch of a large-scale network equipment refresh cycle.
The service segment, it highlighted, also posted steady growth backed by expanding Unified SASE cloud solutions and integration of recent acquisitions. This is despite noting customer caution regarding contract durations.
The firm further pointed out that long term growth rates may face challenges from potential margin compression risks, which in turn come from rising memory prices, currency volatility and competitive pressures that are further intensifying.
We maintain our $90 price target for FTNT shares but are downgrading our recommendation from “Buy” to “Hold” given current valuation levels.
Fortinet, Inc. (NASDAQ:FTNT), a cybersecurity company, provides enterprise-level next-generation firewalls and network security solutions, leveraging artificial intelligence across its cybersecurity products.
8. International Business Machines Corporation (NYSE:IBM)
Number of Hedge Fund Holders: 66
On February 18, Erste Group analyst Hans Engel downgraded IBM (NYSE: IBM) from Buy to Hold. Despite IBM’s positive AI outlook, the firm has flagged slowing infrastructure momentum for the stock, weak consulting growth, and financial pressures. These factors, it noted, have led to expectations of sideways price action.
Taking a balanced view of the company’s outlook, Erste Group noted how IBM’s management is focused on the monetization of artificial intelligence via cloud services, as well as the development of proprietary AI chips.
However, on the negative side, it noted that the company’s operating margin has recently fallen sharply and long-term liabilities have risen. Given these offsetting factors, the firm believes that the stock may, for the medium term, struggle to gain upward momentum.
For the time being, it seems realistic to expect the stock price to move sideways in the medium term.
International Business Machines Corporation (NYSE:IBM) is a multinational technology company and a pioneer in artificial intelligence, offering AI consulting services and a suite of AI software products.
7. Datadog, Inc. (NASDAQ:DDOG)
Number of Hedge Fund Holders: 72
On February 17, DA Davidson analyst Gil Luria reiterated a Buy rating on the stock with a $225.00 price target. The firm cited clarity following Investor Day, reinforcing the stock as a “Top Pick” for the year.
DA Davidson attended Datadog’s investor day in New York City, citing improved confidence in the company’s strategy. Management provided clarity into how Datadog’s platform may evolve, it said, and how it will fit in a future world of autonomous observability.
The company event provided additional details on DDOG’s AI roadmap and pointed to potential growth opportunities linked to agentic use cases. It also discussed a few key ARR disclosures related to Security customers and AI use cases.
Moreover, DDOG also reiterated its financial targets at the event, the firm noted.
Datadog remains a top pick for the year. We reiterate our BUY rating and price target of $225.
Datadog, Inc. (NASDAQ:DDOG) offers a cloud-based SaaS platform for monitoring and analytics, specializing in cloud computing and AI-powered cybersecurity products.
6. Palantir Technologies Inc. (NASDAQ:PLTR)
Number of Hedge Fund Holders: 81
Palantir Technologies Inc. (NASDAQ: PLTR) has received fresh analyst support after analysts pointed out a significantly de-risked valuation following a steep contraction in its forward multiples. On February 18, Mizuho analyst Gregg Moskowitz upgraded the stock from Neutral to Outperform with a price target of $195.00.
Praising Palantir’s business performance, Mizuho described PLTR as a”category of one”, pointing to the company’s combination of revenue growth, accelerating performance, and margin expansion at a scale unlike others in software.
For several months, the firm shared a concern that PLTR’s shares may suddenly face meaningful reversion at some point. They highlighted that Palantir’s estimated 2026 enterprise value-to-free-cash-flow (EV/FCF) multiple has contracted by an estimated 46% in the early weeks of the year.
With PLTR’s 2026E EV/FCF valuation multiple having fallen 46% in the first six weeks of the year, we believe the de-rating has occurred and that the risk/reward is now attractive.
Palantir Technologies Inc. (NASDAQ:PLTR) is a leading provider of artificial intelligence systems.
5. MongoDB, Inc. (NASDAQ:MDB)
Number of Hedge Fund Holders: 89
On February 17, RBC Capital analyst Rishi Jaluria reiterated an Outperform rating on the stock with a $500.00 price target ahead of the company’s fourth-quarter fiscal 2026 earnings report. The firm views MongoDB as well-positioned for AI-driven application development.
Scheduled to report earnings on Monday, March 2nd, RBC Capital is of the view that MongoDB should be the database provider of choice for building GenAI and Agentic AI-based applications.
MDB F4Q26 Preview: Looking For Continued Atlas Acceleration/Signs of AI Tailwinds; In this note, we preview MongoDB ahead of F4Q26 earnings, which are slated for Monday, March 2nd with a call scheduled for 5PM EST.
The firm highlighted four key areas of investor focus; namely, continued traction with AI-native customers driving potential Atlas acceleration, commentary surrounding go-to-market changes under new CEO CJ Desai, when AI products may start incremental tailwind profit and loss statement through broader adoption of newer AI SKUs (considering AI isn’t yet contributing meaningfully), and initial fiscal 2027 guidance.
While shares have performed well on a T12M basis and feel less dislocated, we continue to view valuation as undemanding and continue to think shares represent an attractive buying opportunity.
MongoDB, Inc. (NASDAQ:MDB) provides a general-purpose database platform worldwide that integrates operational, unstructured, and AI-related data to streamline building applications.
4. Broadcom Inc. (NASDAQ:AVGO)
Number of Hedge Fund Holders: 183
Despite optimism around the company’s AI exposure, recent analyst commentary on Broadcom reflects a divergence in views. Goldman Sachs, for instance, has reiterated Broadcom as “Buy” in recent coverage, stating that it’s bullish ahead of Broadcom earnings.
Expect a solid quarter, with continued AI momentum.
Broadcom Inc. will announce its first quarter fiscal year 2026 results on Wednesday, March 4, 2026.
Meanwhile, Robert W. Baird has also reiterated its positive view, maintaining a Buy rating on the stock with a $420.00 price target. The firm is bullish on AVGO, particularly due to its AI momentum and earnings potential.
According to Baird, accelerating demand for Broadcom’s v7 custom ASICs powering Google’s TPU infrastructure, is leading to a sharp increase in expected AI-related revenue. In contrast, on February 12, DA Davidson initiated coverage of four major semiconductor names, namely: AMD, Intel, Broadcom and Taiwan Semiconductor Manufacturing Co.
For Broadcom, the firm initiated coverage with a Neutral recommendation and a $335 PT, noting that the company is “sitting on a shrinking iceberg” as hyperscalers increasingly shift toward customized accelerators.
DA Davidson believes that some of Broadcom’s largest customers may internalize more of their silicon stack, a shift that may pressure supplier economics overtime. It further noted how AVGO’s AI ASIC opportunity is not sufficient to warrant a premium valuation compared to market leaders such as Nvidia.
Broadcom is a technology company uniquely positioned for the AI revolution, thanks to its custom chip offerings and networking assets.
3. Alphabet Inc. (NASDAQ:GOOGL)
Number of Hedge Fund Holders: 219
On February 17, Citizens analyst Andrew Boone reiterated a Market Outperform rating on the stock with a $385.00 price target. According to the firm, artificial intelligence is expanding the Total Addressable Market for search by enabling to cover more types of queries and inferring more commercial intent from information questions.
We are going to continue to shout from the rooftops that AI is expanding the TAM for search…
The firm said that retail media budgets may be switching over to Search as agentic search matures, further stating its belief that Google can sustain search growth in the teens.
Net/net, we believe Google can sustain search growth in the teens (if not 20%+).
Alphabet Inc. (NASDAQ:GOOGL) is an American multinational technology conglomerate holding company wholly owning the internet giant Google, amongst other businesses.
2. NVIDIA Corporation (NASDAQ:NVDA)
Number of Hedge Fund Holders: 234
Investor focus is returning to Nvidia after the company’s announcement of an expanded partnership with Meta. On February 18, Stifel analyst Ruben Roy reiterated a Buy rating on the stock with a $250.00 price target.
Nvidia’s multiyear, multigenerational strategic partnership with Meta spans on-premises, cloud and AI infrastructure and will likely include large-scale deployment of Nvidia CPUs, GPUs and Spectrum-X Ethernet networking.
Stifel particularly highlighted that META will adopt NVDA’s rack-scale Confidential Computing, discussed at the company’s CES Keynote. This adoption will be made as a foundational feature of the upcoming Vera Rubin platform.
The latest collaboration is the first large-scale Grace CPU only deployment, which both companies will support with infrastructure co-design and software optimization investments.
Meta will implement NVDA’s Confidential Computing, initially for WhatsApp private processing and, with potential expansion across other emerging use cases.
We believe that this expanded collaboration reinforces the longer-term structural alignment between the two companies and further validates NVDA’s ‘extreme co-design’ initiative, i.e. evolving from a chip to systems to AI platform solutions provider. While we expect hyperscalers to continue to invest in internal silicon projects (and related networking initiatives) with vendors such as Celestica (CLS, Buy – $286.66) and Arista Networks (ANET, not covered), we continue to expect NVDA to compete effectively with a full-stack architecture approach.
NVIDIA Corporation (NASDAQ:NVDA) specializes in AI-driven solutions, offering platforms for data centers, self-driving cars, robotics, and cloud services.
1. Amazon.com, Inc. (NASDAQ:AMZN)
Number of Hedge Fund Holders: 332
On February 18, Morgan Stanley reiterated the stock as “Overweight” with a $300 price target, stating that Amazon remains a top idea and AI winner. According to Morgan Stanley, Amazon’s AWS and Retail are both underappreciated GenAI winners that could drive further upside.
AMZN is Top Pick as AWS/Retail both under-appreciated GenAI winners. AWS seems set to further accelerate as capex yield framework shows how it could grow 30%+ in ’26/’27. We also discuss why AMZN is an agentic winner with leverage and why partnerships would be positive/ manageable
The firm anticipates AWS revenue growth to exceed 30%, supported by a strong backlog that reflects durable enterprise demand. However, one bottleneck for AWS growth is that it is partly constrained by data center capacity, which is why capital expenditures will be important for acceleration.
Beyond cloud, the firm highlighted Agentic Commerce as another catalyst for AMZN. It believes how AMZN is likely to expand horizontal AI partnerships and also strengthen its vertical leadership through its AI-powered shopping assistant, Rufus.
AMZN now trades at ~19X our ’27 GAAP EPS…for ~20% forward EPS growth. This is a 40% discount to peers on a PEG basis…as the name is caught in GenAI narrative cross currents and question marks around ROIC [return on invested capital] on its AI-related capex. That said, we remain bullish through this uncertainty and continue to think AMZN is the most under-appreciated GenAI winner of our coverage.
Amazon.com Inc. (AMZN) is an American technology company offering e-commerce, cloud computing, and other services, including digital streaming and artificial intelligence solutions.
While we acknowledge the potential of AMZN as an investment, our conviction lies in the belief that some AI stocks hold greater promise for delivering higher returns and have limited downside risk. If you are looking for an AI stock that is more promising than AMZN and that has 100x upside potential, check out our report about this cheapest AI stock.
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