We recently published a list of Top 10 Stocks Analysts are Watching as AI Selloff Deepens. In this article, we are going to take a look at where Amazon.com Inc (NASDAQ:AMZN) stands against other top stocks analysts are watching as AI selloff deepens.

Major AI stocks are struggling to gain traction as investors rethink their strategies amid concerns of a slowdown in spending. Even top tech bulls are starting to use the word “bubble” for the AI trade. Gene Munster, Deepwater Asset Management managing partner, said in a latest program on CNBC that he believes we still have two years of the AI bull run before the bubble bursts.

“From a high-level perspective, I always return to the fundamentals as a tech investor. The fundamentals of these companies remain strong. I predict we have two good bullish years ahead before a spectacular bubble burst. When I see this, it shakes my confidence, but if I stay focused on the fundamentals, I still believe this trade will play out.”

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For this article, we picked 10 stocks analysts are currently talking about. With each company 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 373.4% since May 2014, beating its benchmark by 218 percentage points (see more details here).

A customer entering an internet retail store, illustrating the convenience of online shopping.

Amazon.com Inc (NASDAQ:AMZN)

Number of Hedge Funds Investors: 286

Stephanie Link, CIO at Hightower, explained in a latest program on CNBC why she recently started selling her stake in Amazon.com Inc (NASDAQ:AMZN).

“I started trimming it a couple of weeks ago. I went from really very much overweight to market weight—now I’m slightly underweight. It’s still about a 32% position for me, but you have 95% of the sell side with buys on this thing—just about everybody owns it on the buy side too. I think that it’s had a nice run, it’s up 23% from its August lows, and I just thought I could take that cash and put it elsewhere into names that have just gotten hammered.”

Mar Vista Global Quality Strategy stated the following regarding Amazon.com, Inc. (NASDAQ:AMZN) in its Q4 2024 investor letter:

“Amazon.com, Inc.’s (NASDAQ:AMZN) profitability was the key highlight of the third quarter financial results, with AWS and International Retail achieving record operating margins, and North America Retail posting its second-best margin in five years. Even more impressive was the fourth quarter operating income forecast, projecting up to $20 billion, significantly exceeding the expected $16 billion and suggesting a record 11% margin. This exceptional performance was driven by economies of scale, logistics efficiencies, successful AI implementations, increasing ad revenue, and accelerated AWS growth.

We keep our investment in Amazon due to several factors: AWS growth has further potential, Amazon Prime Video monetization is in its initial stages, and the company is expanding into promising sectors like Pharmacy and Logistics. Furthermore, with strengthening profitability and cash reserves exceeding $100 billion, the possibility of substantial capital returns increases. By continuing to innovate and invest in technologies like AI and cloud computing, Amazon is well-positioned to keep its competitive edge.”

Overall, AMZN ranks 1st on our list of top stocks analysts are watching as AI selloff deepens. While we acknowledge the potential of AMZN as an investment, 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 timeframe. If you are looking for an AI stock that is more promising than AMZN 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.