Prediction. Kevin Warsh's Fed View Could Unlock These 4 AI Stocks Under $10 That the Market Has Left for Dead

"Kevin Warsh has put a fresh frame on the inflation debate, arguing that AI-driven productivity gains could allow the economy to grow faster without triggering inflation. If that supply-side view gains traction at the Fed, patience on rates becomes the base case, and the small-cap AI names that have been left for dead suddenly look like coiled springs. Nowhere is that asymmetry sharper than in the cohort still trading under $10."

"C3.ai (NYSE: AI) C3.ai sells enterprise AI applications to commercial and federal customers. Shares closed at $9.03 on May 14, still down 33.01% year to date, which gives retail investors a damaged but cheap entry. Q3 FY26 was ugly: revenue of $53.26 million fell 46.08% year over year and missed consensus by 29.59%. The bull case rests on the rebuild. Federal, defense, and aerospace bookings jumped 134% YoY, and the restructuring targets ~$135 million in annual operating expense savings. CEO Stephen Ehikian says "C3 AI is now a more agile, more disciplined, and more accountable organization." The risk is accelerating cash burn, with free cash flow at negative $56.2 million. A patient Fed buys this turnaround time."

"BigBear.ai (NYSE: BBAI) BigBear.ai provides AI decision intelligence to defense and national security customers. The stock sits at $4.38, up 24.43% over the past month as government AI spending headlines have returned. FY26 revenue guidance of $135 million to $165 million implies roughly 17% growth at the midpoint, and the backlog now exceeds $400 million. CEO Kevin McAleenan said the company "reduced our debt by more than 90%" after raising $693 million in 2025. The Ask Sage acquisition adds roughly $25 million in ARR tied to generative AI for defense. The risk: material wea"

AI-driven productivity gains are presented as a supply-side force that could let the economy expand faster without triggering inflation. If the Federal Reserve adopts patience on rates in response, investors may reprice beaten-down AI equities, especially small-cap names trading below $10. C3.ai sells enterprise AI applications to commercial and federal customers, with recent revenue declines but a turnaround plan tied to restructuring and higher bookings, while cash burn remains a key risk. BigBear.ai provides AI decision intelligence for defense and national security, with improving guidance, a large backlog, and debt reduction, supported by generative AI expansion, though execution risks persist.

Read at 24/7 Wall St.