In this article, we discuss 10 best fast money stocks to buy according to hedge funds.
Raging inflation and high interest rates continue to weigh on consumer spending in the past few months, raising investor concerns around an economic recession in the United States that could slow down global growth. Final estimates from the US Bureau of Economic Analysis reveal that the US economy shrank for the second consecutive quarter in the three months ended June, meeting the technical criteria for a recession. The GDP shrank by 0.6% on an annualized basis in the second quarter, below the initially reported 0.9% decline.
The numbers indicate that storm clouds are likely to hover over the marketplace in the coming months. However, not all is doom and gloom. Newly released job data shows that payrolls increased 275,000 in September, while the unemployment rate held at 3.7%. Per a recent survey, top US economists expect average hourly earnings to increase 0.3% month-over-month in September, compared to 5.1% from a year ago. The latter number is below the figures estimated for the month of August.
In this macro environment, investors are eagerly looking for stocks that offer a healthier risk/reward ratio in the near-term, primarily because investments in traditional growth offerings are a no-go. Some of the best stocks to monitor in this regard include Microsoft Corporation (NASDAQ:MSFT), The Walt Disney Company (NYSE:DIS), and Humana Inc. (NYSE:HUM), among others discussed in detail below. As policymakers try to beat inflation, these options could offer investors access to fast money.
Our Methodology
The companies that have upcoming growth catalysts were selected for the list. In order to provide readers with some context for their investment choices, the business fundamentals and analyst ratings for the stocks are also discussed. Data from around 900 elite hedge funds tracked by Insider Monkey in the second quarter of 2022 was used to identify the number of hedge funds that hold stakes in each firm.
Photo by buian_photos on Unsplash
Best Fast Money Stocks To Buy According To Hedge Funds
10. LyondellBasell Industries N.V. (NYSE:LYB)
Number of Hedge Fund Holders: 37
LyondellBasell Industries N.V. (NYSE:LYB) operates as a chemical company in the United States, Germany, Mexico, Italy, Poland, France, Japan, China, the Netherlands, and internationally. It is one of the best fast money stocks to invest in. The company has grappled with declining prices from commodity chemicals and lower volumes in the past few months. However, the attractive yield and dividend history offers investors some much-needed solidity as the market environment becomes more volatile.
On September 16, Deutsche Bank analyst David Begleiter maintained a Hold rating on LyondellBasell Industries N.V. (NYSE:LYB) stock and lowered the price target to $85 from $92, noting that the company was seeing weaknesses across core segments driven by higher costs.
At the end of the second quarter of 2022, 37 hedge funds in the database of Insider Monkey held stakes worth $953.5 million in LyondellBasell Industries N.V. (NYSE:LYB), compared to 32 in the previous quarter worth $744 million.
Just like Microsoft Corporation (NASDAQ:MSFT), The Walt Disney Company (NYSE:DIS), and Humana Inc. (NYSE:HUM), LyondellBasell Industries N.V. (NYSE:LYB) is one of the best fast money stocks to buy now according to hedge funds.
In its Q3 2021 investor letter, Miller Howard Investments, an asset management firm, highlighted a few stocks and LyondellBasell Industries N.V. (NYSE:LYB) was one of them. Here is what the fund said:
“We initiated a position in LyondellBasell (LYB). Chemical markets are currently robust given the combination of 2020 plant shutdowns and strongly recovering demand. Despite the tailwinds, Lyondell trades at a low valuation and yields just under 5%.”
9. Las Vegas Sands Corp. (NYSE:LVS)
Number of Hedge Fund Holders: 42
Las Vegas Sands Corp. (NYSE:LVS), together with its subsidiaries, develops, owns, and operates integrated resorts in Asia and the United States. It is one of the top fast money stocks to invest in. The stock has climbed in the past few weeks on the back of reports that the firm is the frontrunner to operate in the home of the Mets. Steve Cohen, the owner of the Mets, is engaging city officials and casino owners to discuss the options to open a casino in Citi Field. The shares have also benefited from easing of virus restrictions across the globe.
On September 26, Citi analyst George Choi maintained a Buy rating on Las Vegas Sands Corp. (NYSE:LVS) stock and raised the price target to $60 from $58, highlighting the resumption of Macau-bound e-visas as a positive surprise.
Among the hedge funds being tracked by Insider Monkey, Chicago-based firm Citadel Investment Group is a leading shareholder in Las Vegas Sands Corp. (NYSE:LVS), with 4.1 million shares worth more than $138.6 million.
In its Q2 2022 investor letter, Baron Funds, an asset management firm, highlighted a few stocks and Las Vegas Sands Corp. (NYSE:LVS) was one of them. Here is what the fund said:
“Certain travel-related businesses remain cyclically depressed not secularly challenged and should rebound as economic strength re-emerges. For example, the business operations of Macau-centric casino and gaming companies such as Las Vegas Sands Corporation (NYSE:LVS) have yet to recover due to the ongoing COVID-19 challenges in China. We expect business to rebound sharply when economic growth recovers just as it did in Las Vegas. Las Vegas Sands Corporationis a global leader in the development and operation of luxury casino resorts in Macau and Singapore, and it maintains a liquid and investment grade balance sheet. It is currently valued at a significant discount to our assessment of replacement cost, and the company’s Macau operations are valued at only 7 times estimated cash flow.”
8. Archer-Daniels-Midland Company (NYSE:ADM)
Number of Hedge Fund Holders: 42
Archer-Daniels-Midland Company (NYSE:ADM) procures, transports, stores, processes, and merchandises agricultural commodities, products, and ingredients. It is one of the elite fast money stocks to invest in. On August 17, the company announced that it had partnered with animal free dairy company, New Culture, to increase the development and commercialization of alternative dairy products. Under the deal, New Culture will also gain access to a range of plant-based ingredients and flavors offered by the former.
On August 12, Wolfe Research analyst Sam Margolin initiated coverage of Archer Daniels-Midland Company (NYSE:ADM) with an Outperform rating and a $117 price target, noting that the nutrition section for the firm alone provides very competitive dividend growth.
Among the hedge funds being tracked by Insider Monkey, Washington-based firm Markel Gayner Asset Management is a leading shareholder in Archer-Daniels-Midland Company (NYSE:ADM), with 1.5 million shares worth more than $113.6 million.
In its Q1 2022 investor letter, Diamond Hill Capital, an asset management firm, highlighted a few stocks and Archer-Daniels-Midland Company (NYSE:ADM) was one of them. Here is what the fund said:
“ADM is a leading agricultural processor that also operates a global nutrition business focused on the development of ingredients and flavors for food and beverages, supplements and more. The company’s recent operating results have benefited (unfortunately) from the war in Ukraine as grain prices and agricultural markets globally experienced strong price increases. ADM is positioned well to benefit from the volatility due to its stable North American agricultural base.”
7. Constellation Brands, Inc. (NYSE:STZ)
Number of Hedge Fund Holders: 44
Constellation Brands, Inc. (NYSE:STZ) produces, imports, markets, and sells beer, wine, and spirits. It is one of the premier fast money stocks to invest in. The shares have slid after President Obrador of Mexico announced that the Mexican government will no longer be granting new permits to beer production companies in the region. However, the firm remains well-positioned from a rise in demand for beverages as international travel resumes and the holiday season approaches.
On September 30, investment advisory Barclays maintained an Overweight rating on Constellation Brands, Inc. (NYSE:STZ) stock and lowered the price target to $272 from $284. Analyst Lauren Lieberman issued the ratings update.
At the end of the second quarter of 2022, 44 hedge funds in the database of Insider Monkey held stakes worth $1.29 billion in Constellation Brands, Inc. (NYSE:STZ), compared to 41 in the preceding quarter worth $982 million
6. IQVIA Holdings Inc. (NYSE:IQV)
Number of Hedge Fund Holders: 53
IQVIA Holdings Inc. (NYSE:IQV) provides advanced analytics, technology solutions, and clinical research services to the life sciences industry. It is one of the most prominent fast money stocks to invest in. On July 21, the firm posted earnings for the second quarter of 2022, reporting earnings per share of $2.44, beating estimates by $0.06. The revenue over the period was $3.44 billion, beating estimates by $50 million.
On August 24, Credit Suisse analyst Dan Leonard initiated coverage of IQVIA Holdings Inc. (NYSE:IQV) stock with an Outperform rating and a $300 price target, noting that the firm’s combined data and research assets will continue to drive industry-leading sales growth.
At the end of the second quarter of 2022, 53 hedge funds in the database of Insider Monkey held stakes worth $2.8 billion in IQVIA Holdings Inc. (NYSE:IQV), compared to 62 in the previous quarter worth $3.3 billion.
Alongside Microsoft Corporation (NASDAQ:MSFT), The Walt Disney Company (NYSE:DIS), and Humana Inc. (NYSE:HUM), IQVIA Holdings Inc. (NYSE:IQV) is one of the best fast money stocks to buy now according to hedge funds.
In its Q2 2022 investor letter, L1 Capital International, an asset management firm, highlighted a few stocks and IQVIA Holdings Inc. (NYSE:IQV) was one of them. Here is what the fund said:
“IQVIA Holdings Inc. (NYSE:IQV) is the leading global provider of advanced analytics, technology solutions and clinical research services to the life sciences industry. Behind many of the breakthroughs in the treatment of COVID-19 you will find IQVIA. It is the largest contract research organisation (CRO) globally, planning and managing clinical trials as well as reporting on safety and efficacy in the real world following regulatory approval. IQVIA is not the life science industry gold miner, but rather provides the ‘picks and shovels’ to support others discover life sciences industry gold.
Few companies can compete with IQVIA – a proprietary database of over 1.2 billion non-identified patient records, a global healthcare IT network that receives and processes 100 billion healthcare records annually while ensuring privacy and security, combined with unique technology, data analytics and logistical capabilities managed by 80,000 employees in over 100 countries. IQVIA delivers information and insights on over 85% of the world’s pharmaceuticals, as measured by global sales. Disruption risk to this highly specialised but comprehensive network is limited (…read more)
5. The Progressive Corporation (NYSE:PGR)
Number of Hedge Fund Holders: 54
The Progressive Corporation (NYSE:PGR), an insurance holding company, provides personal and commercial auto, personal, residential and commercial property, general liability, and other specialty property-casualty insurance products and related services. It is one of the best fast money stocks to invest in. On August 17, the shares climbed after the auto and property insurer posted results that showed year-on-year growth in premiums. Net premiums written in July increased 8% from a year ago and net premiums earned of $4.69 billion rose 9%.
On August 29, investment advisory Raymond James maintained an Outperform rating on The Progressive Corporation (NYSE:PGR) stock and raised the price target to $140 from $135. Analyst Gregory Peters issued the ratings update.
Among the hedge funds being tracked by Insider Monkey, Chicago-based investment firm Orbis Investment Management is a leading shareholder in Berkshire Hathaway Inc. (NYSE: BRK-A), with 4.7 million shares worth more than $542 million.
In its Q2 2022 investor letter, RiverPark Funds, an asset management firm, highlighted a few stocks and The Progressive Corporation (NYSE:PGR) was one of them. Here is what the fund said:
“Progressive Corp had a positive contribution to performance during the quarter. Net Premiums Written (NPW) grew +12% as the Company grew both policies in force and took the rate to offset higher loss cost trends that are being driven by inflation. For example, we estimate accident severity for personal auto is up +35% since the beginning of the pandemic.
However, this is partially offset by a 20% decline in frequency, due to people driving fewer miles. Progressive is making up for this net rise in cost by raising policy rates in the mid-teens percentage range. Progressive has been relatively early to take rate compared to industry peers, so the Company should be able to aggressively compete for share as competitors play catchup.”
4. NextEra Energy, Inc. (NYSE:NEE)
Number of Hedge Fund Holders: 59
NextEra Energy, Inc. (NYSE:NEE) transmits, distributes, and sells electric power to retail and wholesale customers in North America. It is one of the top fast money stocks to invest in. On September 16, BMO Capital analyst James Thalacker maintained an Outperform rating on NextEra Energy, Inc. (NYSE:NEE) stock and raised the price target to $100 from $92, noting that the company’s industry-leading profile within the sector warrants a premium valuation given its fundamental and thematic drivers.
At the end of the second quarter of 2022, 59 hedge funds in the database of Insider Monkey held stakes worth $2.76 billion in NextEra Energy, Inc. (NYSE:NEE), compared to 64 in the preceding quarter worth $2.85 billion.
In its Q2 2022 investor letter, ClearBridge Investments, an asset management firm, highlighted a few stocks and NextEra Energy, Inc. (NYSE:NEE) was one of them. Here is what the fund said:
“We increased our exposure to the energy transition during the quarter with new positions in Iberdrola (OTCPK:IBDSF), a Spanish-based integrated utility that is also one of the leading renewable energy developers in the world, and NextEra Energy, Inc. (NYSE:NEE), an integrated utility business with a regulated utility operating in Florida and the largest wind business in the U.S. The war has opened the eyes of the world that energy independence is critical. Renewables are for many countries the only way to get to the target. It is expected that existing renewable project pipelines will be executed faster, and more projects added to existing pipelines.
The energy transition would be extremely helpful for climate change and Iberdrola ranks well on our ESG matrix. NextEra, meanwhile, recently raised future earnings forecasts, citing a very favorable macro environment for rapid renewable generation expansion driven by decarbonization of the U.S. economy and the relative attractiveness of renewable generation in the context of high natural gas and power prices.”
3. Humana Inc. (NYSE:HUM)
Number of Hedge Fund Holders: 69
Humana Inc. (NYSE: HUM) operates as a health and well-being company in the United States. It is one of the elite fast money stocks to invest in. On September 26, RBC Capital analyst Frank Morgan maintained an Outperform rating on Humana Inc. (NYSE:HUM) stock and raised the price target to $544 from $541, noting that the company’s strong long-term earnings targets are driven by growth in core medicare advantage and value-based care initiatives.
At the end of the second quarter of 2022, 69 hedge funds in the database of Insider Monkey held stakes worth $3.7 billion in Humana Inc. (NYSE: HUM), compared to 66 in the preceding quarter worth $3.1 billion.
In its Q2 2022 investor letter, Diamond Hill Capital, an asset management firm, highlighted a few stocks and Humana Inc. (NYSE: HUM) was one of them. Here is what the fund said:
“Humana Inc. (NYSE:HUM) stock has experienced higher volatility over the past year, and its 7% advance in Q2 largely reflected a recovery from the strong selloff that followed a disappointing pullback in its Medicare Advantage member enrollment guidance for 2022 back in January. Despite the near-term volatility, we are confident in Humana’s long-term value creation plan and its ability to achieve market enrollment growth and improvement in its health care services businesses.”
2. The Walt Disney Company (NYSE:DIS)
Number of Hedge Fund Holders: 109
The Walt Disney Company (NYSE:DIS), together with its subsidiaries, operates as an entertainment company worldwide. It is one of the premier fast money stocks to invest in. On September 30, the firm announced that it had entered into a support agreement with activist investor Daniel Loeb and his hedge fund, Third Point. It also said that The Walt Disney Company (NYSE:DIS) would add Facebook veteran Carolyn Everson to the board with Loeb’s support.
On September 30, Bank of America analyst Jessica Reif Ehrlich maintained a Buy rating on The Walt Disney Company (NYSE:DIS) stock and lowered the price target to $127 from $144, citing the company’s lower content sales/licensing revenue.
At the end of the second quarter of 2022, 109 hedge funds in the database of Insider Monkey held stakes worth $3.2 billion in The Walt Disney Company (NYSE:DIS), compared to 113 in the previous quarter worth $5.2 billion.
In its Q2 2022 investor letter, Oakmark Funds, an asset management firm, highlighted a few stocks and The Walt Disney Company (NYSE:DIS) was one of them. Here is what the fund said:
“Disney (NYSE:DIS) is one of the most beloved consumer companies in the world. Its media business has a rich library of intellectual property, which provides a powerful engine for creating new content across the Disney, Pixar, Marvel, and Star Wars brands. This content also contributes to the success of Disney’s theme parks, which generated nearly half the company’s earnings and grew more than 10% annually in the decade prior to the pandemic. Shares have fallen nearly 50% over the past year as investors worried about the company’s ability to transition its media business to a direct-to-consumer streaming world. This transition has required management to make investments in its Disney+ streaming service that are depressing profitability today. However, we believe these investments will ultimately produce attractive returns as Disney+ continues to grow subscribers and increase pricing over time. As a result, we were able to purchase shares at a substantial discount to our estimate of intrinsic value.”
1. Microsoft Corporation (NASDAQ:MSFT)
Number of Hedge Fund Holders: 258
Microsoft Corporation (NASDAQ:MSFT) develops, licenses, supports software, services, devices, and solutions worldwide. It is one of the most prominent fast money stocks to invest in. On October 5, Brazil’s antitrust regulator approved the $69 billion Microsoft takeover of video game maker Activision. The deal was approved without any conditions, according to a filing on the regulator’s website. Competitors Sony and Google had raised their concerns about the deal to regulators.
On September 29, Raymond James analyst Andrew Marok resumed coverage of Microsoft Corporation (NASDAQ:MSFT) stock with an Outperform rating and $300 price target, noting the firm had strong positioning in public cloud, gaming, and digital advertising.
At the end of the second quarter of 2022, 258 hedge funds in the database of Insider Monkey held stakes worth $56 billion in Microsoft Corporation (NASDAQ:MSFT), compared to 259 in the previous quarter worth $66 billion.
In its Q2 2022 investor letter, Baron Funds, an asset management firm, highlighted a few stocks and Microsoft Corporation (NASDAQ:MSFT) was one of them. Here is what the fund said:
“Shares of Microsoft Corporation, a leading global provider of software solutions, declined 16.6% in the quarter along with the broader software group as well as due to growing concerns of a potential macro-driven slowdown. This is despite the company posting strong quarterly financial results and successfully absorbing headwinds from the war in Ukraine. The company had 21% revenue growth, 23% operating income growth, and 35% growth in Microsoft Cloud (all year-over-year in constant currency), which now represents 47% of total revenues. (read more…)
You can also take a peek at 10 Best Ethanol Stocks To Buy Now and 10 Best Stocks to Buy According to David Rodriguez-Fraile’s BlueMar Capital.
Follow Insider Monkey on Twitter
Suggested Articles:
- 15 Best Short Squeeze Stocks to Buy Now
- 10 Best Cyclical Stocks To Buy in 2022
- 12 Best EV Stocks to Buy Now
Disclosure. None. 10 Best Fast Money Stocks To Buy According To Hedge Funds is originally published on Insider Monkey.
