In this article, we discuss 10 best Robinhood stocks to buy right now. If you want to skip our detailed analysis of these stocks, go directly to 5 Best Robinhood Stocks To Buy Right Now.
Stock trading applications like Robinhood Markets, Inc. (NASDAQ:HOOD) are becoming more popular as tech-enabled disruption sweeps the world of finance. One of the most appealing services offered by the platform is commission-free trades. These have “democratized” Wall Street in the past few years by allowing retail investors a foothold in the market. The application is home to more than 22 million funded accounts with close to $100 billion in assets. Over 50% are first-time investors and the average users are just around 31 years old.
Robinhood Markets, Inc. (NASDAQ:HOOD) was founded in 2013 and debuted on the stock market in 2021. It raised close to $2 billion in an initial offering that valued the firm at more than $32 billion. Since the IPO, the share price has tanked as investors shed growth options for value plays amid rising inflation. However, hedge funds remain bullish on the future prospects of the firm. At the end of the third quarter of 2021, 20 hedge funds in the database of Insider Monkey held stakes worth $4.6 billion in Robinhood Markets, Inc. (NASDAQ:HOOD).
Interest in stocks popular on Robinhood Markets, Inc. (NASDAQ:HOOD) has grown after the short squeeze saga involving GameStop in January 2021 and the growing importance of retail investors in the stock market. Some of the top Robinhood stocks to buy right now include Microsoft Corporation (NASDAQ:MSFT), NVIDIA Corporation (NASDAQ:NVDA), and Snap Inc. (NYSE:SNAP), among others discussed in detail below.
Our Methodology
These were selected based on the hype around the companies on the trading application Robinhood Markets, Inc. (NASDAQ:HOOD). The analyst ratings and business fundamentals of each stock are also discussed in a bid to weed out “meme stocks” and provide readers with some informed context for their investment choices. Hedge fund sentiment was included as a classifier as well.
The hedge fund sentiment around each stock was calculated using the data of 867 hedge funds tracked by Insider Monkey in the third quarter of 2021.
Photo by Austin Distel on Unsplash
Best Robinhood Stocks To Buy Right Now
10. Sundial Growers Inc. (NASDAQ:SNDL)
Number of Hedge Fund Holders: 7
Sundial Growers Inc. (NASDAQ:SNDL) makes and sells cannabis products for use by adults. As investors shed risky assets in light of inflation and an imminent rise in interest rates, the share price of Sundial Growers Inc. (NASDAQ:SNDL) has tanked in the past few weeks. The sell-off presents an opportunity to pick up the shares of a high-growth stock at a discounted price.
Hedge funds have been offloading Sundial Growers Inc. (NASDAQ:SNDL) stock as well. At the end of the third quarter of 2021, 7 hedge funds in the database of Insider Monkey held stakes worth $8 million in Sundial Growers Inc. (NASDAQ:SNDL), compared to 10 the preceding quarter worth $76 million.
Just like Microsoft Corporation (NASDAQ:MSFT), NVIDIA Corporation (NASDAQ:NVDA), and Snap Inc. (NYSE:SNAP), Sundial Growers Inc. (NASDAQ:SNDL) is one of the stocks gaining in prominence among growth investors.
9. Catalyst Pharmaceuticals, Inc. (NASDAQ:CPRX)
Number of Hedge Fund Holders: 17
Catalyst Pharmaceuticals, Inc. (NASDAQ:CPRX) is a clinical-stage pharma firm that develops treatments for rare diseases. Major hedge funds are bullish on the stock. Among the hedge funds being tracked by Insider Monkey, New York-based investment firm Armistice Capital is a leading shareholder in Catalyst Pharmaceuticals, Inc. (NASDAQ:CPRX), with 10 million shares worth more than $53 million.
On February 7, HC Wainwright analyst Andrew Fein maintained a Buy rating on Catalyst Pharmaceuticals, Inc. (NASDAQ:CPRX) stock and raised the price target to $12 from $9, appreciating the solid earnings of the firm in the fourth quarter and investor confidence in revenue estimates for the coming months.
8. BlackBerry Limited (NYSE:BB)
Number of Hedge Fund Holders: 20
BlackBerry Limited (NYSE:BB) is a Canadian firm that provides security software services. The company recently stopped support and services for Blackberry mobile devices, bringing to an end close to three decades of investment in mobile phones and signaling a permanent shift towards enterprise-based security software. In late January, the firm also announced the sale of non-core patent assets to Catapult IP Innovations for $600 million.
Elite hedge funds back BlackBerry Limited (NYSE:BB) to succeed in the cybersecurity space. Among the hedge funds being tracked by Insider Monkey, Canada-based investment firm Fairfax Financial Holdings is a leading shareholder in BlackBerry Limited (NYSE:BB), with 46 million shares worth more than $454 million.
7. Carnival Corporation & plc (NYSE:CCL)
Number of Hedge Fund Holders: 36
Carnival Corporation & plc (NYSE:CCL) operates as a leisure travel firm. There is positive hedge fund sentiment around the stock. At the end of the third quarter of 2021, 36 hedge funds in the database of Insider Monkey held stakes worth $520 million in Carnival Corporation & plc (NYSE:CCL), up from 31 in the previous quarter worth $456 million.
On February 10, Citi analyst James Hardiman kept a Neutral rating on Carnival Corporation & plc (NYSE:CCL) stock and raised the price target to $27 from $24.50, noting the improvements the firm had made to the business during the pandemic crisis that had led to the creation of an intriguing margin story heading into the post-pandemic economy.
In its Q1 2021 investor letter, ClearBridge Investments, an asset management firm, highlighted a few stocks and Carnival Corporation & plc (NYSE:CCL) was one of them. Here is what the fund said:
“Several of our better performers in the first quarter were purchased while their business models were under stress from COVID restrictions or the macro environment the pandemic created. What gave us confidence in purchasing Carnival was the actions the company took to extend out their balance sheets until travel resumed. Both should benefit as a broader vaccination rollout prompts cruise lines to resume operations and consumers to start traveling again and are positioned to deliver better margins and gain pricing power as the economy normalizes due to the cost controls implemented during the downturn.”
6. Airbnb, Inc. (NASDAQ:ABNB)
Number of Hedge Fund Holders: 58
Airbnb, Inc. (NASDAQ:ABNB) owns and runs an online travel platform. On February 14, Evercore ISI analyst Mark Mahaney kept an Outperform rating on the stock with a price target of $215, tipping the firm as one of the online travel stocks that could “surprise to the upside” in the fourth quarter earnings.
Hedge funds are also bullish on Airbnb, Inc. (NASDAQ:ABNB). Among the hedge funds being tracked by Insider Monkey, Chicago-based investment firm Citadel Investment Group is a leading shareholder in Airbnb, Inc. (NASDAQ:ABNB), with 2.9 million shares worth more than $498 million.
In addition to Microsoft Corporation (NASDAQ:MSFT), NVIDIA Corporation (NASDAQ:NVDA), and Snap Inc. (NYSE:SNAP), Airbnb, Inc. (NASDAQ:ABNB) is one of the stocks that retail investors are buying.
In its Q2 2021 investor letter, Worm Capital LLC, an asset management firm, highlighted a few stocks and Airbnb, Inc. (NASDAQ:ABNB) was one of them. Here is what the fund said:
“Throughout the quarter, you may have noticed that we averaged into a significant position in Airbnb (ABNB). Though the stock has been a relative underperformer since its February highs, we are highly confident about the company’s prospects and its ability to generate meaningful compounded returns over time.
Some history: We have been following Airbnb’s journey for several years, long before the company went public earlier this year. (In fact, nine years ago, in November 2012, Eric profiled the company for Inc.: “Airbnb Is Changing Travel.”)
Whenever we underwrite a new investment, we look for a few key attributes that help us determine the potential long-term value of a business, as well as its risks. In particular, we focus on management (Are they founders? Do they have skin the game? Are they playing the long game?), addressable market size (How big is the opportunity?), its relative growth and creativity to expand (Are they constantly innovating to make the product better for their customers?), margin expansion (Where can we find operating leverage in the model?), its status in the industry (Are they the dominant player? Can they take market share from incumbents?), business risks (What are we missing? Are customers dissatisfied? What do employees say?) and probably a dozen more elements that are critical to our process. It’s only then do we take out the pencils do the valuation work.
In short, ABNB fulfills pretty much every element of a business model we’re attracted to: First, it’s highly scalable marketplace-based business model that unites buyer and seller with observable flywheel effects. (This is an important observation, in that the platform creates significant economic value for millions of hosts who rely on Airbnb, which in turn attracts new hosts who identify the opportunity, which creates more inventory, which turn attracts more travelers, which attracts more hosts, and soon.) Second, it has a global focus with significant opportunities to expand its operating leverage; Third, its management—which is still founder-led—stands out to us as long-term thinkers capable of handling crisis, which the team demonstrated throughout the pandemic by dropping operating costs and turning the business into a more efficient, lean organization. (Like Churchill said: “Never let a good crisis go to waste.”).”
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Disclosure. None. 10 Best Robinhood Stocks To Buy Right Now is originally published on Insider Monkey.
