AI Stocks on the Rise: CoreWeave, Astera Labs, Penguin Solutions

Published Date : 15/07/2025 

While established AI giants like Nvidia and Palantir continue to dominate, smaller companies are emerging with innovative solutions. Discover three overlooked AI stocks that are poised for significant growth. 

Most of the significant AI-driven gains have already been realized by the old guard. It’s time for the next generation of AI stocks to step into the spotlight. There’s no doubt that Nvidia’s processors and Palantir Technologies’ AI software have been the market’s biggest winners. However, smaller companies are now finding ways to capitalize on AI’s growth.

While Nvidia and Palantir are at no immediate risk of being dethroned, don’t be surprised to see some new names taking the lead in performance as the next chapter of the AI era unfolds. Here are three such names to put on your radar, if not yet in your portfolio.

1. CoreWeave

An underappreciated nuance of the business is that most companies utilizing AI technologies don’t actually own their own AI data centers. It’s often cheaper and easier to rent cloud-based access time to these platforms. This is where CoreWeave comes in. CoreWeave offers cloud-accessible AI platforms that are purpose-built from the ground up to provide access to the industry’s newest and most powerful processors, such as Nvidia’s GB200 Blackwell Superchip. This chip trains AI models four times faster than previous platforms and performs real-time inference calculations up to 30 times faster than most current platforms.

CoreWeave’s solutions are so advanced that they are used by industry leaders like OpenAI, Microsoft, and Meta Platforms. Despite its capabilities, CoreWeave is still relatively unknown to many investors. The company went public in March of this year, a time when the market was more concerned with tariff issues. However, its first-quarter revenue soared 420% to nearly $1 billion, and analysts expect triple-digit top-line growth in the coming years, with profitability likely by 2027. CoreWeave is clearly coming into its own as technology giants recognize the potential of next-generation AI solutions.

2. Astera Labs

At first glance, Astera Labs might seem similar to CoreWeave, but the two companies are quite different. CoreWeave offers a turnkey solution for institutions that want access to next-generation AI computing platforms, while Astera Labs focuses on manufacturing and selling the hardware found within data center racks. Astera’s technology is purpose-built specifically for AI, offering significant advantages over early AI hardware.

For example, Astera’s Aries line of PCIe/CXL connectivity tech supports data transmission between AI processors at speeds of up to 64 gigatransfers per second. This means more computing power with less power consumption and a smaller physical footprint, ultimately translating into lower operating costs. The company also offers PCIe switches, digital signal processors, and memory controllers that offer better functionality in a smaller package.

The demand for Astera’s solutions is evident in its projected revenue growth of 80% this year, pushing the company into profitability. Analysts expect this growth to continue, making Astera Labs a compelling investment opportunity.

3. Penguin Solutions

Penguin Solutions, formerly known as SMART Global Holdings, is another overlooked AI stock with significant growth potential. Despite its small market cap of $1.3 billion, Penguin Solutions is a powerful player in the AI data center infrastructure market. The company is expected to see sales growth of 17% this year, driven by increasing demand for its specialized solutions.

Penguin Solutions offers a range of products and services, including fault-tolerant computing memory modules, data center design and deployment services, and software to manage computing clusters in modern AI data centers. Unlike many other AI companies, Penguin Solutions is consistently profitable and trades at a reasonable valuation. The stock is currently trading at about 15 times this year’s projected per-share profits of $1.62, which are expected to grow 17% to $1.89 next year.

While Penguin Solutions is a small-cap stock capable of above-average volatility, its consistent profitability and strong growth prospects make it an attractive investment.

Conclusion

As the AI industry continues to evolve, smaller companies like CoreWeave, Astera Labs, and Penguin Solutions are emerging as key players. These companies offer innovative solutions that are essential for the next generation of AI applications. While they may not have the same name recognition as established giants, they are poised for significant growth and are worth considering for your investment portfolio. 

Frequently Asked Questions (FAQS): 

Q: What is CoreWeave's main business model?

A: CoreWeave offers cloud-accessible AI platforms that are purpose-built to provide access to the industry’s newest and most powerful processors, such as Nvidia’s GB200 Blackwell Superchip.

Q: What makes Astera Labs different from CoreWeave?

A: While CoreWeave offers a turnkey solution for AI computing platforms, Astera Labs focuses on manufacturing and selling the hardware found within data center racks, specifically designed for AI.

Q: Why is Penguin Solutions considered an overlooked AI stock?

A: Penguin Solutions is overlooked due to its small market cap and lesser name recognition, but it offers a range of specialized solutions for AI data centers and is consistently profitable.

Q: What is the projected revenue growth for Astera Labs?

A: Astera Labs is expected to see revenue growth of 80% this year, pushing the company into profitability.

Q: How does CoreWeave’s GB200 Blackwell Superchip compare to other processors?

A: CoreWeave’s GB200 Blackwell Superchip trains AI models four times faster than previous platforms and performs real-time inference calculations up to 30 times faster than most current platforms. 

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