The MunAIMarkets Small/Mid Cap AI Stocks Portfolio Is DOWN 9% So Far In 2025 - ARCHIVED

An Introduction

There are literally hundreds of small ($300-$2B) and mid ($2B-$$10B) cap generative AI (Gen AI) companies and this article highlights the 6 largest such stocks in the MunAiMarkets Small/Mid Cap AI Stocks Portfolio and ranks them as to their performances MTD, in descending order, and in 2024 along with their market capitalizations and the reasons behind any significant price changes, as follows: (Before proceeding listen to the MunAiMarkets theme song and get in the mood to join the rich man’s world!)

1. Digimarc Corporation (DMRC): UP 10.2% MTD; UP 3.7% in 2024
   • Focus: provides digital identifiers designed to address counterfeiting, product authenticity, recycling accuracy, and supply chain traceability.
   • Market Capitalization: $884M
   • Reasons For Price Change:
     • Stock Performance: Digimarc’s stock price passed above its 200-day moving average, reaching as high as $41.93. This indicates a strong upward trend.
     • Analyst Ratings: Needham & Company LLC reissued a “buy” rating and set a $40.00 price objective on Digimarc shares. This positive outlook from analysts has likely boosted investor confidence.
     • Institutional Investors: Several institutional investors have increased their holdings in Digimarc, which has further driven up the stock price.
     • Company Developments: Digimarc has launched new technologies and partnerships, such as an advanced anti-counterfeit technology and a brand protection app, which have been well-received by the market.
2. Innodata (INOD): DOWN 6.9% MTD; UP 385.5% in 2024
   • Focus: provides AI-enabled software platforms and managed services for AI data annotation, AI digital transformation, and industry-specific business processes.
   • Market Capitalization: $1,070M
   • Reasons For Price Change:
     1. Analyst Ratings: Analysts have maintained a “Buy” rating for Innodata, with an average price target of $38.20, indicating a potential upside.
     2. Institutional Investors: Several institutional investors have increased their holdings in Innodata, boosting investor confidence.
     3. Company Performance: Innodata has reported strong financial performance and has launched new AI-driven solutions, which have been well-received by the market.
     4. Market Sentiment: Positive market sentiment and investor optimism have also played a role in driving up the stock price.
3. BigBear.ai (BBAI): DOWN 11.9% MTD; UP 107.9% in 2024
   • Focus: provides AI and machine learning to assist customers in aggregating, interpreting, and synthesizing data to enable real-time decision-making capabilities.
   • Market Capitalization: $986M
   • Reasons For Price Change:
     1. Increased Trading Volume: There was a significant increase in trading volume, with 8.39 million shares traded, which is a 76% decrease from the average session volume.
     2. Analyst Ratings: While some analysts have maintained a positive outlook, there have been mixed reviews, which may have caused some uncertainty among investors.
     3. Insider Selling: CEO Amanda Long sold 66,140 shares at an average price of $4.50 on January 6th, which might have influenced market perception.
4. Applied Optoelectronics (AAOI): DOWN 15.8% MTD; UP 90.8% in 2024
   • Focus: provides fiber-optic access network products for the cable broadband, internet data center, telecom, and fiber-to-the-home markets.
   • Market Capitalization: $1,530M
   • Reasons For Price Change:
     1. Analyst Ratings: Several analysts have upgraded their ratings on Applied Optoelectronics, with some setting higher price targets. For example, Raymond James increased their target price from $17.00 to $39.00.
     2. Company Performance: Applied Optoelectronics has shown strong traction in its fiber optic networking products, particularly in the Internet data center and cable television markets.
     3. Market Sentiment: Positive market sentiment and investor optimism have also played a role in driving up the stock price.
5. Evolv Technologies (EVLV): DOWN 19.2% MTD;  DOWN 16.3% in 2024 
   • Focus: screens people for threats without sacrificing the visitor experience.
   • Market Capitalization: $503M
   • Reasons For Price Change:
     1. Financial Performance: Evolv has reported a forecasted decline in earnings by an average of 56.3% per year over the next three years. This has negatively impacted investor sentiment.
     2. Market Volatility: Evolv’s stock has been quite volatile, with a weekly volatility of 16%, which is higher than the industry average.
     3. Company Developments: Recent changes in the company’s board and executive team, including the resignation of the CFO, have created uncertainty among investors.
     4. Industry Performance: Evolv has underperformed compared to the broader US electronic industry, which has seen a return of 22.6% over the past year, while Evolv’s return has been negative.
6. SoundHound AI (SOUN): DOWN 31.3% MTD; UP 835.9% in 2024
   • Focus: offers voice AI solutions that let businesses offer conversational experiences to their customer in 25 different languages.
   • Market Capitalization: $5,040M
   • Reasons For Price Change
     • Why Was SoundHound AI Among Last Week’s Biggest Losers?

Go HERE for a live chart (updated minute-by-minute) of each constituent in the portfolio (Not available yet)

The MunAiMarkets Small/Mid Cap AI Stocks Portfolio went UP 95.8% in 2024 but is DOWN 8.6% so far in 2025.