Best AI Stocks to Watch in April 2025

These are the top AI stocks based on best value, fastest growth, and most momentum.

March saw a slew of major developments in the artificial intelligence (AI) space. OpenAI projected its revenue will reach $12.7 billion in 2025 and exceed $125 billion by 2029. However, the private company cautioned that it does not expect to be cash-flow positive for the next four years. While OpenAI remained bullish on the industry’s prospects, Microsoft (MSFT) took a more cautious stance, canceling two gigawatts of data center projects in the U.S. and Europe due to lower demand projections. The move came just ahead of the initial public offering (IPO) of CoreWeave, a leading high-performance computing and AI infrastructure firm, which cut the size of its IPO by 25%, signaling waning investor enthusiasm.

All data are current as of March 27, 2025.

Best-Value AI Stocks

Value investing is about finding stocks trading below their true worth, with the expectation that the market will eventually correct the mispricing and the stock price will rise. Investors often use price-to-earnings (P/E) ratio to find stocks that are undervalued, as a lower P/E ratio can indicate that a company is valued at less than its fundamental value.

However, it may take multiple quarters or years before a turnaround materializes.  Some stocks may also remain cheap for a reason, falling into a “value trap,” continuing to underperform despite appearing undervalued. Moreover, the P/E ratio should not be viewed in isolation. Investors should ask why a stock is trading at a discount to its peers and whether that gap is likely to close due to a business recovery, or the market recognizing the value opportunity.

• Yiren Digital Ltd: An AI-powered fintech company based in China, Yiren Digital offers payment processing, loan services, insurance, and ecommerce products. On March 27, Yiren announced it had formed a strategic joint venture to deliver AI-powered financial services in Indonesia.
• Hut 8 Corp: Hut 8 is a digital infrastructure company focused on high-performance computing hosting and Bitcoin mining. As of March 6, the company owns over 1 gigawatt of energy infrastructure across Canada and the U.S., with 3 megawatts dedicated to high-performance computing and AI.
• Consensus Cloud Solutions, Inc. Consensus Cloud Solutions provides a secure, cloud-based fax service that helps businesses, especially in health care, exchange and manage documents digitally. Consensus’s Clarity platform can extract critical information from unstructured data using natural language processing (NLP), with use cases in patient record keeping for health care customers.

Fastest-Growing AI Stocks

Growth investors look for companies with increasing revenue and earnings per share (EPS), believing these metrics signal strong business fundamentals and potential for value appreciation. However, relying on just one of these indicators can present an incomplete picture, as factors like tax law changes, mergers, or one-time gains can distort the numbers.

For a more balanced assessment, we screen AI growth stocks by looking at the most recent year-over-year percentage growth for both revenue and EPS, giving each equal weighting. We also excluded companies with growth rates in either category of 1,000% or more on the grounds that these are likely outliers.

• InterDigital, Inc: InterDigital is a research and development company specializing in wireless, video, and AI technologies for smartphones, consumer electronics, vehicles, and cloud services. In early March, the company signed a new multi-year licensing deal with a major Chinese smartphone vendor, increasing its annualized recurring revenue outlook by $40 million.
• Innodata, Inc: Innodata Inc. is a data engineering company specializing in delivering high-quality training data for use in generative AI models. Recently the company reported record Q4 and full-year 2024 results, with Q4 revenue up 127% year-over-year to $59.2 million and full-year revenue nearly doubling to $170.5 million.
• SoundHound AI, Inc: SoundHound’s proprietary technology offers fast, accurate voice recognition across various industries, including automotive, TV, Internet of Things (IoT), and customer service. On Feb. 27, SoundHound announced 2024 revenue of $84.7 million, up 85% year-over-year, as the company expanded across major sectors including automotive, restaurants, health care, and telecom.

AI Stocks With the Most Momentum

Momentum investing is a strategy that seeks to capitalize on existing market trends by investing in stocks that have recently outperformed their peers or the broader market. The core idea is that stocks on an upward trajectory are likely to continue rising as long as the fundamental drivers
behind their growth remain intact.

The momentum strategy has become synonymous with AI, owing to the fast growth of this sector. AI names can generate returns that far outpace established tech names, driven mostly by investor sentiment. While it’s a viable strategy for those with a higher risk tolerance, investors should also focus on the company’s underlying financials to ensure the anticipated growth prospects will materialize.

Here are the AI stocks with the highest total return in the last 12 months.

• Quantum Computing, Inc: Quantum Computing is an integrated photonics and quantum technology company focused on developing accessible and affordable quantum computing solutions. Despite skepticism surrounding the near-term viability of quantum computing, the company has partnered with agencies such as NASA.
• Innodata, Inc: Innodata is a data engineering company specializing in delivering high-quality training data for use in generative AI models. Recently the company reported record fourth-quarter and full-year 2024 results, with fourth-quarter revenue up 127% year-over-year to $59.2 million and full-year revenue nearly doubling to $170.5 million.
• VNET Group, Inc: VNET operates high-performance internet data centers across China, providing server hosting, cloud computing, and secure virtual private network (VPN) services. The company wrapped up a successful 2024 with revenues increasing 11% year-over-year to $1.13 billion with 468 megawatts of total data center capacity.

Advantages of AI Stocks

Mass Disruption

AI is a rapidly evolving sector with applications across nearly every industry, from health care to finance and cybersecurity. As adoption accelerates, AI companies have significant room for revenue expansion and market dominance. Furthermore, ongoing advancements in research and development are enhancing AI models’ reasoning and adaptability, unlocking even greater disruptive potential.

Innovation

AI-driven automation enhances efficiency, leading to reduced costs for businesses. Companies leading in AI development can secure long-term competitive advantages, making them attractive investments in both the short and long term.

Investor Enthusiasm

AI stocks often experience strong investor enthusiasm, driving rapid price appreciation. With ongoing advancements in machine learning, automation, and generative AI, market sentiment remains highly bullish, fueling momentum-driven gains.

Disadvantages of AI Stocks

High Valuations and Market Speculation

Many AI stocks trade at high valuations due to investor enthusiasm and growth expectations. While the AI sector has strong long-term potential, some companies may be overvalued, leading to the risk of significant price corrections. Speculative investments, particularly in early-stage AI companies, can result in inflated valuations that may not be supported by actual revenue or profitability.

Regulatory Risks

AI technology is increasingly facing scrutiny from governments and regulatory bodies worldwide. Concerns over data privacy, algorithmic bias, job displacement, and national security risks could lead to stricter regulations that impact operations and growth prospects. The legal landscape around AI is still in its early stages, and new laws around transparency, intellectual property rights, and ethical AI development are being fleshed out.

Stiff Competition

The AI industry is highly competitive, with major players such as Alphabet (GOOGL), Microsoft (MSFT), Nvidia (NVDA), and OpenAI continuously advancing their technologies. This rapid pace of innovation means that companies that fail to stay ahead may become obsolete. Additionally, emerging AI startups such as DeepSeek can disrupt established players seemingly overnight, making it difficult for investors to predict long-term trends.

The Bottom Line

AI stocks offer significant growth potential, fueled by rapid technological advancements and strong investor enthusiasm. However, high valuations, regulatory uncertainties, and intense competition pose risks that investors must carefully navigate. While AI remains a compelling long-term investment, careful scrutiny of a company’s financials and thorough risk management are essential to avoid speculative bubbles and hype.

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As of the date this article was written, the author does not own any of the above securities.