As President Joe Biden nears the end of his term, he is issuing a series of executive orders. In the latest, the President has signed an order to provide federal support to address the massive energy needs of fast-growing advanced artificial intelligence data centers.
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The order will allow federal land owned by the Defense and Energy departments to host gigawatt-scale AI data centers and new clean power facilities. According to Biden, the order will “accelerate the speed at which we build the next generation of AI infrastructure here in America, in a way that enhances economic competitiveness, national security, AI safety, and clean energy”.
According to the order, companies tapping federal land for AI data centers must also purchase an “appropriate share” of American-made semiconductors. These purchases will be decided on a case-by-case basis.
“It’s really vital that we ensure that the AI industry can build out the infrastructure for training and using powerful AI models here in the United States”.
-White House technology adviser Tarun Chhabra.
Several known names, including OpenAI Senior Vice President of Global Affairs Chris Lehane, have commended this effort. Lehane also called out for cultivating a robust domestic infrastructure for the growing U.S. artificial intelligence sector.
“So what you get with the Biden administration today is — at least from a signaling perspective — on federal land, trying to short the timeline between when you can get your project shovels in the ground and then the project going forward”.
-Chris Lehane
According to Lehane, the incoming Trump administration sees AI through two lenses — national security and economic security. He hopes that both sides of the coin will amalgamate into a national strategy.
AI Company OpenAI has also recently laid out its vision for artificial intelligence development in the U.S. According to the company, the US needs investment from abroad and supportive regulation to stay ahead of China in the race for nascent technology. In a 15-page document called the “Economic Blueprint”, it said that “Chips, data, and energy are the keys to winning AI” and that the U.S. needs to act now to craft nationwide rules that can help secure its advantage.
OpenAI released the document days before President-elect Donald Trump takes office, with CEO Sam Altman also previously donating around $1 million to Trump’s inaugural fund in hopes of fostering a positive relationship.
“There’s an estimated $175 billion sitting in global funds awaiting investment in AI projects, and if the U.S. doesn’t attract those funds, they will flow to China-backed projects —strengthening the Chinese Communist Party’s global influence”.
-OpenAI said in the document.
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10. BigBear.ai Holdings, Inc. (NYSE:BBAI)
Number of Hedge Fund Holders: 7
BigBear.ai Holdings, Inc. (NYSE:BBAI) is an artificial intelligence specialist that provides decision intelligence solutions. On January 15, the company announced that the Board of Directors has appointed Kevin McAleenan as Chief Executive Officer and member of the Board of Directors, effective January 15, 2025. The leadership change marks an important step for the business, noted Peter Cannito, Chair of the Board of Directors of BigBear.ai. This is because there is a robust demand for differentiated artificial intelligence solutions that provide strategic advantage in government and business. The amalgamation of recent technological achievements and strategic contract awards has placed BigBear.ai as a leading AI solutions provider focused on national security imperatives. McAleenan’s appointment will help BigBear.ai support the company’s objectives.
“It is an honor to step into the role of CEO at BigBear.ai. The success of our customers depends on their ability to navigate complexity and act decisively in the most high-stakes environments. BigBear.ai is uniquely positioned to support these objectives with our domain expertise, and our cutting-edge technology. I look forward to working with this exceptional team to build on our successes and expand our ability to deliver AI-powered solutions in ways that make a meaningful impact for our customers, partners, and stakeholders”.
-McAleenan.
9. Cerence Inc. (NASDAQ:CRNC)
Number of Hedge Fund Holders: 10
Cerence Inc. is a software company that provides AI-powered virtual assistants and innovations for the mobility/transportation market. On January 2nd, the company announced that it had signed a multi-year agreement with luxury automaker JLR for developing the automotive’s next-generation in-car experience. Under the agreement, Cerence’s AI-enabled technologies will be leveraged to deliver advanced intelligence and capabilities to JLR customers globally. The companies also intend to continue working together to expand and improve the JLR in-car experience.
“JLR has long been synonymous with technologically advanced driving experiences, and we’re proud to collaborate with this luxury automotive to further extend their reputation in this field. Cerence AI will collaborate with JLR to craft a new generation of in-car experiences that enhance enjoyment, safety, and productivity by leveraging the latest technological advancements”.
-Christian Mentz, Chief Revenue Officer, Cerence AI.
8. Box, Inc. (NYSE:BOX)
Number of Hedge Fund Holders: 31
Box, Inc. (NYSE:BOX) enables organizations of various sizes to manage and share their content from anywhere on any device. On January 15, the company announced the launch of a new set of AI-powered innovations in its Enterprise Advanced plan. Designed to revolutionize how organizations manage content, the new plan combines the full power of Box’s ICM platform into a single offering. This will allow customers to automate workflows, extract valuable insights, and accelerate processes across the enterprise with Box. The AI tools enable teams across HR, marketing, legal, and sales to easily design and rapidly roll out intelligent, no-code apps. Customers on the Enterprise Advanced plan can also leverage Box AI Studio, allowing businesses to create, test, and deploy custom AI agents according to their unique requirements. The company is also delivering Box Doc Gen via API to Enterprise Advanced customers allowing automated document creation by pulling data from third-party apps, custom apps, and metadata.
“There is a tremendous amount of value trapped inside enterprise content, but the majority of companies can’t harness the full value of their information with existing legacy solutions. Breakthroughs in LLMs now allow businesses of any size to transform their unstructured data into actionable insights and automate critical workflows. With Enterprise Advanced, Box is delivering an Intelligent Content Management platform in a single offering that empowers businesses to harness the value of their content like never before — all at a fraction of the cost”.
-Aaron Levie, Co-founder and CEO of Box.
7. Palantir Technologies Inc. (NASDAQ:PLTR)
Number of Hedge Fund Holders: 43
Palantir Technologies Inc. (NASDAQ:PLTR) is a leading provider of artificial intelligence systems. On Tuesday, January 14, the Biden administration issued an executive order allowing private sector AI companies to lease federal sites where the U.S. can build frontier AI infrastructure at speed and scale.
“The United States leads the world at the frontier of artificial intelligence (AI). Cutting-edge AI will have profound implications for national security and enormous potential to improve Americans’ lives if harnessed responsibly, from helping cure disease to keeping communities safe by mitigating the effects of climate change. However, we cannot take our lead for granted. We will not let America be out-built when it comes to the technology that will define the future, nor should we sacrifice critical environmental standards and our shared efforts to protect clean air and clean water. That is why today, I am signing an historic Executive Order to accelerate the speed at which we build the next generation of AI infrastructure here in America, in a way that enhances economic competitiveness, national security, AI safety, and clean energy. This Executive Order will direct the Department of Defense and the Department of Energy to lease federal sites where the private sector can build frontier AI infrastructure at speed and scale. These efforts are designed to accelerate the clean energy transition in a way that is responsible and respectful to local communities, and in a way that does not impose any new costs on American families. These efforts also will help position America to lead the world in clean energy deployment in the context of strategic competition abroad. Some of this new capacity will also be committed for use by small businesses and startups. This renewed partnership between the government and industry will ensure that the United States will continue to lead the age of AI”.
The Fly noted that Palantir is one of the companies associated with artificial intelligence or AI, which makes the order an opportunity for the company to expand its role in US government partnerships.
6. ON Semiconductor Corporation (NASDAQ:ON)
Number of Hedge Fund Holders: 45
ON Semiconductor Corporation (NASDAQ:ON), or onsemi, is a semiconductor manufacturing company that provides intelligent sensing and power solutions. On January 15, the company announced that it had completed its acquisition of the Silicon Carbide Junction Field-Effect Transistor (SiC JFET) technology business. The deal, including the United Silicon Carbide subsidiary, has been made with Qorvo for $115 million in cash. The addition of SiC JFET technology will strengthen onsemi’s EliteSiC power portfolio offering high energy efficiency and power density units for AI data centers. Besides enhancing power density in data centers, the SiC JFET can also boost efficiency and safety in EV battery systems and enable certain energy storage topologies and solid-state circuit breakers.
“This acquisition further strengthens onsemi’s leadership in power semiconductors by providing disruptive and market leading technologies to our customers to solve their most pressing power density and efficiency problems in AI data centers, automotive and industrial markets. We will continue to innovate and make investments to expand our technology leadership in providing the most comprehensive power system solutions”.
-Simon Keeton, group president and general manager of the Power Solutions Group, onsemi.
5. AppLovin Corporation (NASDAQ:APP)
Number of Hedge Fund Holders: 51
AppLovin Corporation (NASDAQ:APP) provides a leading marketing platform powered by AI technology. On January 13, Morgan Stanley analyst Matthew Cost raised the firm’s price target on AppLovin (APP) to $365 from $200 and kept an “Equal-Weight” rating on the shares. According to the firm, companies using GPUs and adopting AI technologies will have an edge across the North American Internet sector. In particular, the firm has been optimistic about Applovin due to its confidence in the e-commerce ads pilot. The e-commerce ads pilot is an initiative whereby the company integrates e-commerce ads into its mobile gaming ad platform. This program has been demonstrating promising results, with return on ad spend (ROAS) comparable to big tech groups such as Meta. The firm also believes that AppLovin will have steady growth in gaming ads, sustained by improvements in their AI-powered AXON engine. AXON is Applovin’s AI-powered platform that optimizes ad delivery through continuous learning and data refinement.
4. International Business Machines Corporation (NYSE:IBM)
Number of Hedge Fund Holders: 56
International Business Machines Corporation (NYSE:IBM) is a multinational technology company that offers AI consulting services and a suite of AI software products. On January 15, the company announced that AI Hyperscaler CoreWeave will be delivering one of the first NVIDIA GB200 Grace Blackwell Superchip-enabled AI supercomputers to it. IBM will use CoreWeave’s cloud platform to train the next generations of its Granite models, which are enterprise-focused AI tools. CoreWeave’s proprietary software and cloud services provide the software and software intelligence necessary to manage the most complex AI infrastructure at scale. The AI supercomputer will leverage the IBM Storage Scale System to deliver high-performance storage for AI and other demanding workloads. Additionally, CoreWeave customers will be able to access the IBM Storage platform within CoreWeave’s dedicated environments and AI cloud platform.
“We are excited to work with CoreWeave on state-of-the-art AI hardware and software to unlock new capabilities for future generations of IBM Granite models. CoreWeave’s cutting-edge platform can augment IBM’s organic capabilities to help build advanced, performant, and cost-efficient models for powering enterprise AI applications and agents. In turn, IBM Storage is enabling a new world of possibilities for AI by offering IBM Storage Scale System to enhance CoreWeave’s comprehensive suite of developer-focused AI capabilities. And finally, as part of this collaboration, we will leverage this supercomputer to advance open technologies such as Kubernetes that will power AI computing in a hybrid cloud environment”.
– Sriram Raghavan, VP of AI at IBM Research.
3. Constellation Energy Corporation (NASDAQ:CEG)
Number of Hedge Fund Holders: 78
Constellation Energy Corporation (NASDAQ:CEG) is an energy provider specializing in clean, carbon-free energy solutions. On January 10, the company revealed that it has agreed to buy privately held natural gas and geothermal company Calpine Corp for $16.4 billion. This cash-and-stock deal is driven by the rapid growth of AI data centers that require huge amounts of energy to power them. Deemed as one of the biggest acquisitions in U.S. power industry history, the transaction valued Calpine at $26.6 billion, including debt. The agreement will turn Constellation into the largest U.S. independent power provider, potentially adding $2 billion to Constellation’s free cash flow annually. According to Constellation, the deal would allow the companies to have nearly 60 gigawatts (GW) of capacity from zero- and low-emission sources, including nuclear, natural gas, and geothermal. Constellation’s employee base is also expected to grow by nearly 20% to 16,500.
“Demand for our products is expected to grow by levels we haven’t seen in a lifetime”.
-Constellation CEO Joe Dominguez said on a call with investors following the announcement.
2. Tesla, Inc. (NASDAQ:TSLA)
Number of Hedge Fund Holders: 99
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 Monday, January 13, Morgan Stanley analyst Adam Jonas increased his stock price target for Tesla to $430 per share, citing autonomous vehicle (AV) technology and embedded artificial intelligence as the main drivers. According to the firm, Tesla’s stock could ultimately double to $800 per share. Analysts are bullish on the stock due to Tesla’s leadership in autonomous mobility based on its expertise in a variety of areas including data collection, energy storage, robotics, and artificial intelligence. The firm also said that the company’s leadership position in semiautonomous electric robots could allow the company to convert car owners into subscribers “generating highly recurring (and high margin) revenue. Analysts at the firm acknowledge the growth of Tesla’s mobility fleet by 2040, especially those autonomous vehicles that don’t require human supervision. The rating features Tesla’s distinctive capabilities in AI and robotics, leading to an increase in price target.
1. Broadcom Inc. (NASDAQ:AVGO)
Number of Hedge Fund Holders: 128
Broadcom Inc. (NASDAQ:AVGO) is a technology company uniquely positioned in the AI revolution owing to its custom chip offerings and networking assets. On January 13, Jefferies named Broadcom as a top pick, saying that the semis company is a top idea in 2025. The firm raised its price target on the stock to $300 from $225 based on its strong and growing customer base. Broadcom has a rapidly growing AI chip market, driven by demand for custom-designed chips, or ASICs. Its advanced chips are anticipated to rival Nvidia’s in compute density as new technologies like 3.5D packaging and silicon photonics gain traction. The firm further revealed that Broadcom’s AI chip sales could generate over $60 billion in revenue by 2027. This could drive earnings per share to $12 or more. Its AI business has also gained momentum, specifically in training-focused chips, which need higher prices as designs become more complex. As these chips become larger and incorporate more advanced technologies, it will drive the average selling prices higher.
“AVGO Top Pick but Plenty of Growth to Go Around.”
While we acknowledge the potential of AVGO 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 timeframe. If you are looking for an AI stock that is more promising than AVGO but that trades at less than 5 times its earnings, check out our report about the cheapest AI stock.
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