Article Summary

• NVIDIA dominates hedge fund portfolios with 223 funds invested, driven by its 114% revenue growth to $130.5 billion and leadership in AI, while Apple ranks second with 166 funds attracted to its $500 billion U.S. investment plan.
• Tesla remains a hedge fund favorite despite volatility, with 126 funds anticipating its sub-$30,000 EV in mid-2025, while Palantir has drawn 64 funds based on 36% revenue growth and expanding financial sector partnerships.
• American Airlines rounds out the top five with 59 hedge funds invested, following its early achievement of a $15 billion debt reduction target and record $54.2 billion revenue in 2024.

 

Institutional investors have made clear bets on technology leaders and recovery plays in early 2025, with the latest data showing concentrated positions in companies driving AI innovation and those showing strong financial performance. 

These hedge fund favorites offer insights into where smart money focuses in today’s market.

Hedge Funds Are Bullish on Nvidia Stock

NVIDIA continues to dominate hedge fund portfolios in 2025., Around 223 funds hold positions in the chip giant which is valued at a market cap of almost $3 trillion. 

Nvidia’s full-stack computing infrastructure has revolutionized AI development, gaming, and autonomous vehicle technology. 

At CES 2025, NVIDIA unveiled its GeForce RTX 50 Series GPUs powered by the Blackwell architecture, launched in January and February. 

It also introduced Cosmos, an AI model designed to train robots and self-driving cars more efficiently, along with Project DIGITS, a $3,000 AI desktop scheduled to release in Q2, bringing supercomputer capabilities to developers.

NVIDIA’s financial performance backs up the institutional interest. For fiscal year 2025, the company reported:

• Revenue of $130.5 billion, up 114% year-over-year
• GAAP earnings per share increased 147% to $2.94
• Non-GAAP EPS rose 130% to $2.99
• The Data Center segment generated $35.6 billion in Q4 alone, a 93% year-over-year increase

Apple Ranks Second with 166 Hedge Fund Investors

Apple remains a cornerstone holding for institutional investors in 2025., with 166 hedge funds invested in the tech giant. 

Apple’s consistent performance and robust ecosystem continue to attract capital, and recent strategic moves have heightened interest.

Apple announced a massive $500 billion investment in the United States over the next four years. This initiative includes:

• A new server manufacturing facility in Houston
• Doubling its U.S. Advanced Manufacturing Fund to $10 billion
• Expanded silicon production across 24 factories in 12 states
• Domestic chip production now underway at TSMC’s Fab 21 in Arizona

While the iPhone remains the largest business segment for Apple, its Services vertical is expected to drive revenue and earnings in the near-term. 

Wall Street Remains Bullish On Tesla Stock

Despite recent market volatility, Tesla stock continues to attract hedge fund investments, with 126 funds holding positions in the EV maker. The anticipated catalyst driving current interest is Tesla’s upcoming affordable electric vehicle, scheduled to begin production by June 2025.

Analysts, including Wedbush’s Dan Ives, view this sub-$30,000 model as the “missing catalyst” needed to reignite consumer demand. The lower price point is expected to broaden Tesla’s market reach in price-sensitive regions and provide stronger competition against low-cost Chinese manufacturers like BYD.

Tesla’s Q4 2024 results showed mixed performance:

• Overall revenue: $25.71 billion, slightly below expectations
• Automotive revenue: $19.8 billion, down 8% year-over-year
• Energy division: $3.06 billion, up 113% year-over-year

The impressive growth in Tesla’s energy business has become a secondary driver of hedge fund confidence in the company’s diversified future.

Palantir Technologies Attracts 64 Hedge Funds

Palantir Technologies has emerged as a hedge fund favorite. More than 60 funds have invested in the data analytics and AI software company. Its growing prominence in the AI sector has drawn institutional attention.

A key development boosting hedge fund interest is Palantir’s joint venture with TWG Global which is expected to revolutionize AI deployment across vertical such as banking, investment management, and insurance. 

This partnership combines Palantir’s AI infrastructure with TWG’s operational expertise in finance.

Palantir’s Q4 2024 financial results showed remarkable growth:

• Revenue: $828 million, up 36% year-over-year
• U.S. revenue: $558 million, up 52% year-over-year
• Commercial revenue: $214 million, up 64% year-over-year

In Q4 alone, the company closed 129 deals worth at least $1 million and 32 deals exceeding $10 million. Palantir also generated $460 million in cash from operations and $457 million in free cash flow during the quarter.

American Airlines Rounds Out the Top 5 with 59 Hedge Fund Holders

American Airlines has attracted investments from 59 hedge funds, making it the fifth most popular stock among institutional investors. The airline carrier has been navigating recovery in the aviation sector through strategic initiatives and financial discipline.

The company has been expanding operations at hubs like Chicago O’Hare while investing in premium services and technology.

American Airlines posted solid financial results for 2024:

• Record revenue of $54.2 billion
• GAAP net income of $846 million
• Adjusted net income of $1.4 billion
• Operating cash flow of $4 billion
• Record free cash flow of $2.2 billion

A notable achievement was meeting its $15 billion debt reduction target a year ahead of schedule, improving its financial health.

Market Implications

The concentration of hedge fund capital in these five companies reveals clear market themes for 2025:

1. AI infrastructure and applications remain the dominant investment theme, with NVIDIA and Palantir capturing significant institutional interest.
2. Established tech giants with strong ecosystems and strategic U.S. manufacturing investments, like Apple, continue to attract substantial hedge fund capital.
3. Tesla, which represents electric vehicles and sustainable energy transformation, maintains institutional support despite increased competition and market volatility.
4. Recovery plays in traditional sectors, such as American Airlines, are gaining traction as these companies show improved financial health and strategic adaptation.

For investors considering their portfolio allocations, these hedge fund favorites provide valuable insights into where professional investors see opportunity in the current market environment. However, individual investment decisions should always consider personal financial goals, risk tolerance, and independent research beyond institutional positioning.