10 Best AI Stocks to Buy After Wells Fargo’s Outlook Upgrade

8. Teradyne (NASDAQ:TER)

Average Upside Potential: 58%

Number of Hedge Fund Holders: 82

Jefferies analyst Dushyant Ailani started coverage of Teradyne on November 11 with a Buy rating and a $284 target, writing that “AI has made TER a compute test company.” The stock jumped that day.

Teradyne makes the automated equipment that checks chips for defects before they ship. Jefferies expects the market for that equipment to grow from about $9 billion in 2025 to about $25 billion by 2030. It also sees Teradyne’s share of system-on-chip testing rising from 27% to 34%, as Nvidia and large cloud companies buy test systems from more than one supplier instead of one. That opens room for a challenger like Teradyne, and dual sourcing at the largest chip buyers is the central pillar of the Jefferies thesis.

Teradyne also reported better-than-expected results in its latest quarter. Jefferies’ revenue forecasts for the next two years run slightly above consensus. The target itself sits well below the average of other analysts who cover the stock, and shares still trade far under their summer high. Readers weighing the valuation can find a fuller discussion in our piece on whether Teradyne’s AI testing wins are already priced in.

7. SpaceX (NASDAQ:SPCX)

Average Upside Potential: 82%

Number of Hedge Fund Holders: 119

Stifel analyst Jonathan Siegmann reiterated a Buy rating and a $190 target on SpaceX on November 9, days after Democratic midterm wins in states that oppose new data centers raised fears of tougher rules. He argues that SpaceX could step in as a buyer for stalled U.S. projects that already have power secured, which links its launch and power know-how to a real bottleneck for AI builders.

SpaceX launches rockets and runs the Starlink satellite internet network, and its AI computing business now brings in more than half of its sales. Third-quarter revenue rose 161% to $14.6 billion, and its first revenue-generating Starship mission delivered a batch of new Starlink satellites. Chief Financial Officer Bret Johnsen said new computing capacity is paying for itself in less than a year at current prices. The company guided first-quarter 2027 revenue to $33 billion to $37 billion.

The spending behind that growth is heavy, and most of it goes to AI computing. How Starlink fits into funding it is the subject of our look at whether the satellite business can carry the AI bill.

6. Nvidia (NASDAQ:NVDA)

Average Upside Potential: 83%

Number of Hedge Fund Holders: 285

Baird downgraded Nvidia to Neutral from Outperform on November 11 and cut its target to $200 from $500, pointing to the outlook for AI spending and risks tied to China. Evercore ISI followed on November 12, moving the stock to In Line from Outperform with a $186 target. Oppenheimer also lowered its rating that day, to Perform from Outperform.

Nvidia designs the processors that train and run most AI models, so any doubt about customer spending lands on it first. Its chips sit in the data centers of the largest cloud companies, the same buyers whose budgets Baird questions. Investors get a fresh read next Tuesday after the close, when the company reports quarterly results. Wall Street expects earnings of $2.47 per share for the quarter that ended in October.

Bulls argue that the stock’s slide has left it cheap against its own growth record, while bears, Baird among them, want proof that spending stays strong into next year. Our piece on whether Nvidia’s valuation already prices in a growth stall covers the other side of that debate. The report will show whether customers are still placing orders at the same pace.

5. Alibaba (NYSE:BABA)

Average Upside Potential: 84%

Number of Hedge Fund Holders: 97

Mizuho analyst Wei Fang raised his Alibaba target to $200 from $195 on November 3 and kept an Outperform rating, ahead of the company’s earnings report next Thursday.

Alibaba runs the Taobao and Tmall shopping sites, the AliExpress and Lazada marketplaces, and Alibaba Cloud, and the cloud arm is where analysts see the AI payoff. Its Qwen family of AI models feeds that business, giving Alibaba a product to sell alongside computing power. In the quarter ended in June, external cloud revenue grew 45%, and AI-related products made up 35% of it. Analysts also see the QwenWork enterprise agent adding recurring demand.

The cost of that growth worries bears. Adjusted EBITA fell 30% in the same quarter as heavier AI infrastructure spending and higher costs for the Qwen app weighed on earnings, and free cash flow was a larger outflow than a year earlier. Alibaba reports September-quarter results on November 18, and analysts expect earnings of $1.65 per share. The spending side of the story is the focus of our piece on what Alibaba’s AI bill means for its cash.