In this article, we will take a detailed look at the Wall Street Analysts Like These 10 Stocks.
AI stocks are trending following Nvidia’s $100 billion investment in OpenAI. Major AI companies are spending heavily on hardware and software, signaling strong demand in the coming years and dampening the bear case that called the technology a bubble.
Solus Alternative Asset Management’s Dan Greenhaus said in a recent program on CNBC that headlines consistently make the case that the AI story is dominant and weaken the argument that calls for looking beyond the major AI companies.
“I always come back to is just there’s a consistent spade of headlines that reinforce the idea that this is the dominant headline and probably you should stick with it. When you get headlines like this as consistently as we get them, it’s hard to argue why not just stick with what’s working.”
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For this article, we picked 10 stocks Wall Street analysts recently talked about. With each stock, we have 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. 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).
10. Corebridge Financial Inc (NYSE:CRBG)
Number of Hedge Fund Investors: 37
Bill Nygren, Oakmark Funds partner and CIO, said in a recent program on CNBC that Corebridge Financial Inc (NYSE:CRBG) is among the top non-tech stocks on his list. The analyst likes the stock’s valuation and said it’s trading at just six times expected earnings.
“We’re we’re not going to dispute it’s a competitive space, but we’re not arguing it’s worth 20 times earnings. If it’s at five times earnings today and they’re putting most of their capital into share repurchase, you know, in five to seven years, if the stock doesn’t move, they would be taking out the entire market cap of the company. So, a lot of our stories are relatively slow topline go growth that’s supplemented by return of capital to shareholders. And if that goes to share repurchase, that can really boost their earnings per share growth rate.”
Artisan Value Income Fund stated the following regarding Corebridge Financial, Inc. (NYSE:CRBG) in its first quarter 2024 investor letter:
“Our top contributors were nVent Electric, Corebridge Financial, Inc. (NYSE:CRBG) and Lamar Advertising. Corebridge, a life insurance and retirement solutions company, was previously a unit of AIG and a September 2022 IPO. AIG still owns ~51% of the company following its recent secondary sale in November 2023, equaling 9.1% of shares outstanding. Since adding Corebridge to the portfolio in Q1 2023, it’s been among our top performers as the “higher for longer” interest rate environment has driven an increase in spread income. Our investment thesis has been that Corebridge would benefit from the current interest rate environment following ZIRP (zero interest rate policy) and would also have plenty of room to improve its competitive position and wring out efficiencies to improve ROE now that it is a standalone entity that is no longer part of a large inefficient and capital-constrained parent. Even after recent stock price gains, Corebridge yields 3.2% on its dividend, with a double-digit free cash flow yield. In addition to Corebridge’s regular dividend, the company paid two special dividends in 2023 totaling $1.78, which is 7.6% on the March quarter-ending stock price. Besides dividends, we expect free cash flow will be used to ensure holding company liquidity, retire diluted shares and support modest growth expectations.”
9. Aptiv PLC (NYSE:APTV)
Number of Hedge Fund Investors: 40
Stephanie Link, CIO at Hightower, recently said during a program on CNBC that she’s buying Aptiv because the company is in expansion mode. Here is why the analyst likes the stock:
“It’s an auto parts company, but it’s spinning out its software business. And we have a catalyst November. They’re having an analyst day, and we’re going to learn more about the information about the spin. You know, I like spins. Spins work. They’re growing mid-single digits and margins are in expansion mode. And then the software piece, the total addressable market is like 90 billion. They’re growing mid-single digits and I think when they get away from the parent, they’ll be able to focus more on growth and see an acceleration in revenue. So it’s a spin story and it’s that’s the catalyst and that’s the reason in addition to maybe auto parts are just kind of lagging and maybe we’re in for a recovery.”
ClearBridge Large Cap Growth Strategy stated the following regarding Aptiv PLC (NYSE:APTV) in its Q3 2024 investor letter:
“Lastly, we sold our position in tier 1 automotive parts supplier Aptiv PLC (NYSE:APTV). Part of our original investment thesis for Aptiv was that the company should garner a premium multiple versus competitors as its product portfolio was well-positioned to take share as auto production shifted toward electric vehicles. However, weak global auto demand and slowing mix shift toward EVs has pressured Aptiv’s business and the company is capturing share at a slower rate than we anticipated. While Aptiv has executed well on profitability and trades at a cheap valuation, we do not foresee the same level of multiple expansion as the company’s growth relative to the market remains weak.”
8. Electronic Arts Incm (NASDAQ:EA)
Number of Hedge Fund Investors: 47
Josh Brown, CEO of Ritholtz Wealth Management, recently made bullish comments about Electronic Arts. Here is why he likes the stock:
“I wanted to mention Electronic Arts Incm (NASDAQ:EA). This was the best stock in the market conversation we had the other day. It’s set up. It’s starting to move higher. I like it right here.”
Macquarie Large Cap Growth Fund stated the following regarding Electronic Arts Inc. (NASDAQ:EA) in its Q1 2025 investor letter:
“The largest individual detractors from performance relative to the benchmark were not owning Meta Platforms, not owning Eli Lilly & Co., and our position in Electronic Arts Inc. (NASDAQ:EA). Lastly, Electronic Arts is one of the leading video game developers with a portfolio that includes franchises like Madden NFL, EA Sports FC, and The Sims. While the company transitioned to digital, a tailwind for margins, and maintained nearly impenetrable competitive positions across several popular genres, it also made some acquisition missteps into mobile and has been unable to further monetize its competitive strengths. The next catalyst for a stock rerating has been absent, and we became concerned the quality characteristics that made this business so compelling were declining. With that, we exited the position.”
7. SanDisk Corp (NASDAQ:SNDK)
Number of Hedge Fund Investors: 49
Mark Newman, Bernstein senior analyst, recently said during a program on CNBC that the market is underappreciating SanDisk Corp (NASDAQ:SNDK), and the stock is undervalued. Here is how the analyst made the case for the stock:
“I mean, SanDisk Corp (NASDAQ:SNDK) just spun out from Western Digital earlier in the year. I think it’s not well appreciated. I think it’s starting to outperform the last few weeks. But if you look prior to that, it had been pretty flat. And if you look in our initiation note out today, we value Sandisk on a few different metrics. And if you value it on a portion of its fab replacement value, it is trading at about half, which means it is trading at less than half of the value of the fab replacement cost. It’s not putting any real value into the ongoing free cash flow generation and earnings growth from the company. The actual intellectual property in the company is effectively valued at zero. And so we think there’s a lot more upside here. They are also benefiting from the intelligence revolution and the data explosion as well because data is being stored in not just hard disk drives but also nan flash. So SanDisk Corp (NASDAQ:SNDK) also benefits from this.”
Loomis Sayles Small Cap Value Fund stated the following regarding Sandisk Corporation (NASDAQ:SNDK) in its second quarter 2025 investor letter:
“Sandisk Corporation (NASDAQ:SNDK) is a leading manufacturer of flash memory data storage primarily for consumer electronic devices and the recent investment was predicated on a cyclical recovery in the company’s end markets. However, the potential negative consequences of tariffs on the consumer electronics market and data storage prices was determined to be an investment thesis break and we exited our relatively small position after a modest rally in the stock off the early April price level.”
6. QXO Inc (NYSE:QXO)
Number of Hedge Fund Investors: 65
Stephanie Link, CIO at Hightower, recently said during a program on CNBC that she is buying QXO. The company distributes roofing, waterproofing, and other building products in the United States. Here is why Link likes QXO:
“It’s led by an industry pioneer, Brad Jacobs. He was at United Reynolds. He was at XPO. He’s at Waste Management. He’s a rock star. He has put a billion dollars of his own money into this company. And this company is really just all about making acquisitions in the building products distribution industry. Okay. And so I think it’s a hidden way of playing the construction, housing, just rebuild play. They have best-in-class EBITDA. They’re growing five times as much as the industry trading at a discount to the industry. And I just think they have the best technology. So they make these acquisitions and then they use technology to get more efficient, productive, and that sort of thing. Hence the profitability story. And so I think this is just a hidden way of playing that kind of the cycle in general.”
Patient Capital Opportunity Equity Strategy stated the following regarding QXO, Inc. (NYSE:QXO) in its second quarter 2025 investor letter:
“QXO, Inc. (NYSE:QXO) was the top contributor to performance during the quarter following the completion of its $11B acquisition of Beacon Roofing in April. This marks the first of what is expected to be a series of acquisitions, as the company pursues a roll-up strategy in the highly fragmented building products distribution industry. QXO is leveraging a proven playbook that its management team has successfully executed across other sectors. With a strong track record and investor confidence, the company benefits from the ability to raise capital on attractive terms, giving it a competitive edge vs peers. Furthermore, management has proven their price discipline walking away from a bidding war for GMS Inc., which was ultimately acquired by Home Depot. We view this disciplined approach as a testament to management’s long-term focus. Over the next decade, QXO is targeting more than $50B in annual revenue. We have high conviction in Brad Jacobs’ leadership and believe the company is well positioned to become a long term compounder.”
5. Seagate Technology Holdings PLC (NASDAQ:STX)
Number of Hedge Fund Investors: 71
Mark Newman, Bernstein senior analyst, said in a recent program on CNBC that Seagate Technology Holdings PLC (NASDAQ:STX) is one of his favorite data storage stocks as demand for data storage technologies is increasing amid the AI revolution. Here is what Newman said:
“Seagate Technology Holdings PLC (NASDAQ:STX) is the leader in Heat Assisted Magnetic Recording (HAMR) technology. It is the next generation in hard disk drive technology. We think that is going to enable them to drive down costs much faster than competitors leading to an expansion in margins which is leading to a 28% CAGR in EPS over the next 5 years and so I think this if you consider almost 30% 5-year CAGR in earnings this stock is still very cheap where it is so we think there’s still a lot more upside for this stock.”
4. Eaton Corporation PLC (NYSE:ETN)
Number of Hedge Fund Investors: 74
Bartlett Wealth Management’s Holly Mazzocca said in a latest program on CNBC that she likes Eaton.
“One area where we are seeing it is in the industrial space and there’s stocks like Eaton Corporation PLC (NYSE:ETN) that we really favor in this environment and area because they are not only an AI play and a growth of the data center play but they’re also looking beyond that as we continue to see the modernization of our electric grid. We’re expecting the US electricity demand to grow sixfold in the next 6 years. This is an impressive amount of growth and there are lots of companies that will benefit from it as we start to look beyond just the impact of those mag seven names.”
Macquarie Core Equity Fund stated the following regarding Eaton Corporation plc (NYSE:ETN) in its second quarter 2025 investor letter:
“Eaton Corporation plc (NYSE:ETN) performed well during the quarter. The maker of electrical equipment for critical end markets including power generation, transmission, datacenters, and industrial and corporate applications rebounded on renewed AI optimism. The company also maintains a strong aerospace components business likely to benefit from growth in aircraft production and continued refurbishment of older aircraft.”
3. Merck & Co Inc (NYSE:MRK)
Number of Hedge Fund Investors: 92
Bill Nygren, Oakmark Funds partner and CIO, recently said during a program on CNBC that he likes Merck. Here is how the analyst made the bull case for the stock:
“Merck has some other really interesting assets including strong franchises in vaccines, which is another controversy area today. But we think that will continue to be a good profit source for them. They have a good business in animal health, and then in the pipeline they have a lot of experiments of combining KEYTRUDA with other drugs to more target specific cancers, and we think there’s a reasonable chance that at least one of those will be successful.”
Impax US Sustainable Economy Fund stated the following regarding Merck & Co., Inc. (NYSE:MRK) in its second quarter 2025 investor letter:
“Merck & Co., Inc. (NYSE:MRK) (Health Care, Pharmaceuticals) has a high Corporate Resilience score, and is contributing to a more robust and sustainable health care system through its leading drug and vaccine discovery. The stock’s weakness in Q2 was driven by a combination of concerns about its drug pipeline, particularly the competition from generic versions of Keytruda, and weaker market sentiment around Health Care stocks.”
2. Johnson & Johnson (NYSE:JNJ)
Number of Hedge Fund Investors: 95
Josh Brown, CEO of Ritholtz Wealth Management, explained in a latest program on CNBC why he likes Johnson & Johnson (NYSE:JNJ). Brown said the company’s upcoming quarterly report next month could be a big catalyst.
“The general idea is that if and when a stock breaks out from a typical range that it’s been stuck in, in this case like 5 years, the move could be extraordinary if it had been trapped in that range for a really long time. So there’s an old adage on Wall Street, the bigger the base, the higher in space,” Brown said. “So this is a big base and J&J the company is in the midst of a massive transition that’s been underway for years under a relatively new CEO and they have a couple of key goals and they are executing on those goals. They wanted to become a pure play healthcare company. And they are fully focused on innovative medicines which is oncology, immunology, neuroscience and medtech. So surgical robots, cardiovascular devices, orthopedics and that’s what the business now is. I think taking a step back from gigantic M&A and the types of deals that distract management and really just doing fill-in deals where it makes sense. This strategy is now being rewarded on Wall Street with the stock price working in July. They issued guidance for the rest of the year and had a lot of great news to share, a lot of milestones. The next earnings report is not until October 14th. I think the stock bides its time just under those old highs until we get that October 14th report and that could be the big catalyst.”
Mar Vista U.S. Quality Premier Strategy stated the following regarding Johnson & Johnson (NYSE:JNJ) in its second quarter 2025 investor letter:
“Johnson & Johnson (NYSE:JNJ) declined 7% during the quarter amid a broad selloff in healthcare which led to the sector’s worst relative performance in twenty-five years. Proposed regulatory changes and tariffs impacting drug prices, research and development investments, manufacturing and insurance coverage all converged to create uncertainty for the sector. JNJ also suffered a setback to put talc liabilities behind them when a Texas court ruled the company’s bankruptcy strategy was not allowed. The company will return to litigating lawsuits in the courts, where the company has won 15 out of 16 cases.”
1. Walmart Inc (NYSE:WMT)
Number of Hedge Fund Investors: 105
Oliver Chen, TD Cowen senior retail analyst, said in a recent program on CNBC that despite inflation worries, the consumer in the US has remained resilient. However, the analyst said consumers are “watching their wallet” and looking for value. Chen said Walmart is among his top retail picks. He has a $115 price target on the stock.
“I think it comes back to price elasticity and where and when and how are shoppers prepared to pay more in certain scenarios. Also, companies have had to manage very closely with suppliers to to rationalize this and take some margin hits. Our favorite stock ideas Walmart, Costco, those that understand value and execute to it. We like BJ’s too.”
While we acknowledge the potential of WMT to grow, 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 WMT and that has 100x upside potential, check out our report about this cheapest AI stock.
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