We recently compiled a list of the 10 AI Stocks That Wall Street Is Betting On. In this article, we are going to take a look at where Marvell Technology, Inc. (NASDAQ:MRVL) stands against the other AI stocks.

Elon Musk has been pressing hard to halt OpenAI’s transition into a for-profit entity. But the high-stakes legal battle isn’t seemingly working out in his favor. In the latest news, a U.S. judge has denied the billionaire's request for a preliminary injunction to pause OpenAI's transition to a for-profit model. However, she did agree to a fast-track trial in the fall of this year to address his claims against OpenAI and its CEO, Sam Altman.

According to U.S. District Judge Yvonne Gonzalez Rogers in Oakland, California, Musk doesn’t have "the high burden required for a preliminary injunction" to block the conversion of OpenAI. However, Rogers wrote in the order that she wanted to resolve the lawsuit quickly given "the public interest at stake and potential for harm if a conversion contrary to law occurred."

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The filing noted that even though the plaintiffs “failed to meet their burden of proof for the extraordinary relief requested,” other aspects of Musk’s lawsuit against OpenAI can proceed. Currently, OpenAI is overseen by a non-profit parent that Elon Musk recently offered to buy. However, the company's board unanimously rejected the $97.4 billion offer to buy OpenAI.

Since Musk has become Altman’s chief adversary, he has been putting obstacles in OpenAI’s path to becoming a for-profit entity, claiming that the AI startup will deviate from its original mission of developing artificial intelligence for the benefit of humanity. OpenAI and Altman have denied these accusations, stating that the shift is essential to raise capital and effectively compete in the rapidly evolving AI industry.

OpenAI has welcomed the judge's recent decision, stating that the lawsuit by Musk, who launched rival startup xAI in 2023, has "always been about competition". Meanwhile, Marc Toberoff, a lawyer for Musk, said they were pleased the judge "offered an expedited trial on the core claims driving this case".

“We look forward to a jury confirming that Altman accepted Musk's charitable contributions knowing full well they had to be used for the public's benefit rather than his own enrichment.”

-Marc Toberoff.

For this article, we selected AI stocks by going through news articles, stock analysis, and press releases. These stocks are also popular among hedge funds. The hedge fund data is as of Q4 2024.

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).

An assembly line in a semiconductor factory, with workers at their stations.

Marvell Technology, Inc. (NASDAQ:MRVL)

Number of Hedge Fund Holders: 105

Marvell Technology, Inc. (NASDAQ:MRVL) engages in the development and production of semiconductors. On March 6, Wells Fargo analyst Aaron Rakers maintained a “Buy” rating on the stock and has a $120.00 price target. According to Rakers, the company’s strategic positioning and growth potential justify the buy rating for the stock. In particular, the analyst noted Marvell’s strong alignment with AWS’s next-generation Trainium3 program, anticipated to boost custom XPU revenue significantly.

Another key factor justifying the buy rating for the stock is the company's confidence in gaining market share in the Data Center segment. Marvell Technology, Inc. (NASDAQ:MRVL) has highlighted a substantial total addressable market opportunity by 2028, and it expects to capture a considerable share. In addition, the company’s Enterprise Networking and Carrier segments are expected to recover too. These key factors, albeit some market volatility, justify the firm’s buy rating for the stock.

Overall MRVL ranks 8th on our list of the AI stocks Wall Street is betting on. While we acknowledge the potential of MRVL as an investment, our conviction lies in the belief that some 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 MRVL but that trades at less than 5 times its earnings, check out our report about the cheapest AI stock.

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Disclosure: None. This article is originally published at Insider Monkey.