Investors are closely watching AI stocks following Nvidia’s $100 billion deal with OpenAI. The deal has raised some concerns as analysts pointed out the risks of vendor financing, where companies lend money to their customers to facilitate product purchases. However, Josh Brown, the CEO of Ritholtz Wealth Management, said in a latest program on CNBC that while the market’s concerns about the Nvidia-OpenAI deal aren’t unfounded, he believes the deal cannot be compared with the vendor financing arrangements of the past.
“I don’t think that’s a perfect comparison. When you need your customers to buy, that doesn’t really sound like what I just described. These investments are going to be made anyway—the data centers will be built out regardless. Whether one player wants a bigger investment than another, it’s not about meeting numbers; strategically, they want to be part of the project. In Nvidia’s case, you’re talking about a $4 trillion company making a $100 billion investment over multiple years, with an obvious ROI attached. If it leads to GPU sales and services revenue, it’s a bit different from previous capex booms. I wouldn’t say concerns are totally unfounded, but it’s not as dire as that rhetoric makes it sound,” Brown said.
Photo by Javier Esteban on Unsplash
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READ ALSO: 7 Best Stocks to Buy For Long-Term and 8 Cheap Jim Cramer Stocks to Invest In.
10. Emcor Group Inc (NYSE:EME)
Number of Hedge Fund Investors: 51
Kevin Mahn, president & CIO of Hennion & Walsh Asset Management, said in a recent program on CNBC that he thinks Emcor is an attractive stock. Here’s why:
“So that seems pretty attractive to me, right? If you look at the S&P 500 right now, it’s trading at a current PE of around 24 and a half. That’s above its five and 10 year averages. So, if you can invest in a company like Emcor, which I consider to be data center in a box, if you will, whose stock’s up roughly 37% year-to-date, over 76% over the last one year, that’s pretty attractive. And let’s not also forget that as of September 22nd, they’re going to be included in the S&P 500 index.”
TimesSquare Capital U.S. Focus Growth Strategy stated the following regarding EMCOR Group, Inc. (NYSE:EME) in its second quarter 2025 investor letter:
“Contributing a 45% return was EMCOR Group, Inc. (NYSE:EME), which provides construction and operational services for mechanical and electrical systems to a broad range of commercial, industrial, utility, and institutional customers. EMCOR reported revenues and earnings that bested expectations with a record high level of remaining performance obligations (outstanding and unbilled work for existing customers) along with a healthy pipeline of new projects.”
9. Wynn Resorts Ltd (NASDAQ:WYNN)
Number of Hedge Fund Investors: 52
Jim Lebenthal, Chief Equity Strategist at Cerity Partners, explained in a recent program on CNBC why he was trimming his stake in Wynn Resorts. The analyst said it’s a “good trim,” and he might buy the stock again on a pullback.
This is a good trim. The stock’s up 70% in a year. It’s up 40% over the last three months. If you want to buy low, you have to sell high. I’m trimming it here. Specifically though, I’m starting to see the 2027 estimates start to go higher meaningfully. And what that tells me is that what I’ve been saying for quite some time—that the Dubai New Resort, the Almar Resort, is now finally starting to be priced into estimates. Finally, it started to show some weakness today and I just decided to trim it, actually cutting it about in half. I’d love it if we get a pullback and I add that right back into it. I do still think it’s a good stock for the long run, but I think in terms of share price, it’s ahead of itself right here.”
Baron Discovery Fund stated the following regarding Wynn Resorts, Limited (NASDAQ:WYNN) in its second quarter 2025 investor letter:
“During the quarter, we established a new position in Wynn Resorts, Limited (NASDAQ:WYNN). Wynn is a luxury resort and casino operator which currently owns integrated gaming properties in Las Vegas, Macau, and Boston. At the start of the quarter, the potential impact of tariffs and a trade war with China weighed on the stock. We took advantage of this weakness by building a position at what we believed were attractive prices. In preview, our analysis showed that we were buying the stock at trough valuation multiples on both the Las Vegas and Macau properties and we were getting the upside from the currently under construction Al Marjan Island project (located in the UAE) for essentially free.
There are a handful of factors that differentiate Wynn from other casino operators and make the stock attractive in our opinion. First, we believe Wynn remains the most differentiated operator in the gaming sector with a premium offering that caters to high-end customers. This focus on premium service enables the company to command higher room rates and gaming revenue per visitor. This also helps to insulate the company during more challenging macro economic periods…” (Click here to read the full text)
8. Deckers Outdoor Corporation (NYSE:DECK)
Number of Hedge Fund Investors: 59
Stephanie Link, CIO at Hightower, recently explained in a program on CNBC why she is buying Deckers Outdoor shares. The analyst mentioned Deckers’ Hoka brand growth and market opportunities for expansion.
“I’m a big believer in Hoka myself personally, but the numbers speak for themselves. It’s growing Hoka about 20% and they’re guiding double-digit growth for the rest of the year for Hoka. UGG actually saw a massive snapback of 19% growth last quarter versus 3% the prior quarter. So they’re seeing brand momentum. That’s what I like to see in retail. They have great global opportunities to gain market share. International last quarter grew 50%. I think they’re just at the tip of the iceberg in terms of international momentum.”
Fidelity Growth Strategies Fund stated the following regarding Deckers Outdoor Corporation (NYSE:DECK) in its Q1 2025 investor letter:
“Underweighting shares of footwear and apparel maker Deckers Outdoor Corporation (NYSE:DECK) also notably helped. The stock plunged in January after the firm’s fiscal-year revenue forecast fell short of Wall Street analysts’ expectations. Despite reporting higher sales in its two crucial brands, UGG® and HOKA®, analysts were concerned about the company’s expansion capabilities amid declining sales in its largest market, the U.S., and other challenges.”
7. International Business Machines (NYSE:IBM)
Number of Hedge Fund Investors: 63
Rich Saperstein, Treasury Partners’ founding principal and CIO, discussed why he likes IBM shares during a program on CNBC. Here is why he likes the stock:
“Roughly 35% of the revenue is recurring. They have 64 billion total in revenue. It’s an AI infrastructure software play. They do AI consulting and also they’re coming out with the nextG mainframe. So uh IBM is one of the sleepers. It’s down 20% after they announced their last earnings. Probably a good company again peripheral right around the core of data center growth and that whole technology sleeve.”
6. Walmart Inc (NYSE:WMT)
Number of Hedge Fund Investors: 105
Michael Gunter, Consumer Edge’s head of insights, recently shared some research data on retail companies during a program on CNBC. The analyst said Walmart is among the retailers seeing new shoppers amid inflation.
Companies like Walmart, Dollar General, Dollar Tree, are seeing an outsized share of their new shoppers, we’re talking in the latest uh fiscal quarter and then continuing into August, coming from high-income shoppers. So, this is this is trade down. It’s relative to their overall customer bases. And it could be that even though high-income consumers are are performing better and holding up better than lower-income consumers with rising asset prices, they’re still looking to manage spending, they’re still looking for deals. And it also is an indication that the efforts that these companies have been putting into attracting high-income consumers with expanding assortments might be working.
5. Vistra Corp. (NYSE:VST)
Number of Hedge Fund Investors: 111
Rich Saperstein, Treasury Partners’ founding principal and CIO, said in a recent program on CNBC that he likes Vistra in addition to some other energy plays.
“The ones we own, Vistra, VST, NRG, these companies are generating 9 and 11% operating cash flows. They’re 70 and 30 billion companies. So they’re small, but they’re redeploying that cash extremely effectively. For example, Vistra’s retired roughly 30% of their float since we started buying it in 2021. So it’s a capital allocation. It’s a demand play, and it supports on a periphery the growth in data centers.”
Carillon Eagle Mid Cap Growth Fund stated the following regarding Vistra Corp. (NYSE:VST) in its second quarter 2025 investor letter:
“Vistra Corp. (NYSE:VST) is an integrated electricity and power generation company. As a result of increasing forecasts for future power demand growth, largely brought on by the rapid growth of artificial intelligence, the company’s shares have continued to climb on investors’ expectations for future power prices. A tailwind for the stock has been Vistra’s potential to announce future power purchase agreements (PPAs) with large technology companies to satisfy the outsized power requirements of their artificial intelligence endeavors.”
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