Beckinsale, 45, and Davidson, 25, have been spotted-out and about together in recent weeks.
And on Friday night they were seen holding hands after a comedy gig.
An insider revealed that the actress likes to spend time with younger men who amuse her.
One revealed: "He's her type. She likes young guys who make her laugh."
Kate and Pete were spotted holding hands as they departed Lago Bar in Los Angeles in the early hours of Saturday morning.
Both were all smiles as they were captured by paparazzi leaving the club.
Kate was later seen heading to Pete's hotel after his late night stand-up gig.
The Pete and Kate rumors started after they were seen 'outside on the patio and left together' at the InStyle Golden Globes after a party back on January, 6.
While Davidson seems to be making her smile as she spent last weekend in hospital after suffering from a ruptured ovarian cyst.
From 2004 until 2016, Kate was married to Len Wiseman, director of the first two 'Underworld' movies and a producer on the whole series.
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