We recently published a list of Top 10 AI Stocks to Watch Right Now. In this article, we are going to take a look at where Analog Devices, Inc. (NASDAQ:ADI) stands against other top AI stocks to watch right now.
Tom Hancock, GMO U.S. quality ETF portfolio manager, said in a latest program on CNBC that the NASDAQ has become “risky” bet amid a lot of volatility.
“It’s become not really an index; it’s become a single bet. So it it’s a very risky thing to invest in. It’s not what I think you would want from a sort of diversified investor. It’s probably going to give you more volatile returns next year, and I’d a little bit worry that the AI rally has extended itself. So uh those may be uncomfortably volatile returns.”
Hancock said investors should also pay attention to some of the “old economy” stocks. He thinks AI stocks have become a “hype trade” and any “hiccup” in the economy could result in these stocks crashing. He also urged investors to look for stocks outside the US.
Hancock believes AI gains are now set to broaden out to smaller companies that have not received a lot of attention so far.
READ ALSO: 7 Best Stocks to Buy For Long-Term and 8 Cheap Jim Cramer Stocks to Invest In
For this article we picked 10 AI stocks currently trending based on latest news. With each stock we have mentioned the number of hedge fund investors. 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 275% since May 2014, beating its benchmark by 150 percentage points (see more details here).
A technician working on power management in a semiconductor factory.
Analog Devices, Inc. (NASDAQ:ADI)
Number of Hedge Fund Investors: 63
J.P. Morgan has released its latest forecast for the semiconductor industry in 2025. The firm sees significant potential in the application-specific integrated circuit (ASIC) market, largely driven by the rapid growth of artificial intelligence. The research firm highlighted that companies involved in AI compute, networking, and storage benefited in 2024 due to strong infrastructure development, resulting in notable share price outperformance and positive earnings revisions.
Analog Devices, Inc. (NASDAQ:ADI) is one of JP Morgan’s favorite chip stocks for 2025 as it believes the company is “leveraged to AI and accelerated computing.”
Carillon Eagle Growth & Income Fund stated the following regarding Analog Devices, Inc. (NASDAQ:ADI) in its Q2 2024 investor letter:
“Analog Devices, Inc. (NASDAQ:ADI) rebounded as management teams at several semiconductor companies in the analog space called the bottom, seeing improved conditions ahead. The analog semiconductor industry is a very cyclical business that has underperformed the broader semiconductor industry for several years.”
Overall, ADI ranks 10th on our list of top AI stocks to watch right now. While we acknowledge the potential of ADI, our conviction lies in the belief that under the radar AI stocks hold greater promise for delivering higher returns, and doing so within a shorter time frame. If you are looking for an AI stock that is more promising than ADI but that trades at less than 5 times its earnings, check out our report about the cheapest AI stock.
READ NEXT: 8 Best Wide Moat Stocks to Buy Now and 30 Most Important AI Stocks According to BlackRock
Disclosure: None. This article is originally published at Insider Monkey.