In this article, we discuss 10 best stocks to buy for beginners right now.
For investors who are just beginning their trading journey, it is important to purchase stocks that have growth potential and can withstand market uncertainties. While some investors seek out stocks for dividends alone, others are interested in the share price gains and day trading activities.
After disastrous stock market uncertainty in January and February, where stocks fell about 13% from their record highs, March offered some stability and the S&P 500 Index rose by 3.6%. A significant economic development in March was the rate hike by the Fed. To control the rampant inflation, the Fed will increase interest rates throughout 2022 and attempt to bring down its $9 trillion balance sheet. The bond market is also indicating a possible recession, given the 2-year and 10-year Treasury yields have inverted for the first time since 2019.
Analysts expect the S&P 500 to report earnings growth of 4.8% in the first quarter of 2022, which is the lowest growth rate since the later half of 2020. Investors need to be highly selective in this uncertain market and purchase stocks that will continue to grow despite economic uncertainties.
Given investors who are just starting out usually have low budgets, they cannot afford to build a diversified portfolio with big names like Apple Inc. (NASDAQ:AAPL), Amazon.com, Inc. (NASDAQ:AMZN), and AbbVie Inc. (NYSE:ABBV). In this article, we highlight the best stocks to buy for beginners right now.
Photo by Alvaro Reyes on Unsplash
Our Methodology
We carefully picked stocks that recently received Buy calls from analysts, display growth potential, and have positive hedge fund sentiment surrounding them. For the stocks to be suitable for even risk averse beginners, we made sure that most of the companies belong to sectors that will not be impacted greatly amid market uncertainty, such as energy, gold, biotechnology, and food. We also ensured that the stocks were priced under $30 as of April 7.
Data from 900+ elite hedge funds tracked by Insider Monkey in Q4 2021 was used to identify the number of hedge funds that hold stakes in each firm.
Best Stocks To Buy For Beginners Right Now
10. Eni S.p.A. (NYSE:E)
Share Price as of April 7: $29.21
Number of Hedge Fund Holders: 3
Headquartered in Rome, Italy, Eni S.p.A. (NYSE:E) is a company that provides crude oil, natural gas, chemicals, and condensates. The company is also involved in forestry conservation and the pipeline transport of liquified natural gas. Deutsche Bank analyst James Hubbard on March 23 maintained a Buy recommendation on Eni S.p.A. and raised the firm’s price target on the shares to €14.90 from €14.70.
On March 15, Eni S.p.A. agreed to sell a 49% stake in its Enipower power generation unit to Sixth Street Partners, an American investment firm, reporting that the transaction will help fund the company’s clean energy transition. Although Eni S.p.A. has not officially disclosed financial details, Reuters expects the deal to be valued at more than €500 million.
In 2021, Eni S.p.A.’s full-year revenue came in at $88.5 billion, up from $54.8 billion in 2020. The company’s net income in 2021 rebounded strongly from the $10.5 billion loss in 2020, reaching approximately $7 billion.
According to Insider Monkey’s fourth quarter database, 3 hedge funds were bullish on Eni S.p.A., with collective stakes worth $95.3 million, compared to the same number of funds in the earlier quarter, holding stakes in Eni S.p.A. valued at $75.4 million. Peter Rathjens, Bruce Clarke, and John Campbell’s Arrowstreet Capital held the largest position in the company, with 1.8 million shares worth roughly $51 million.
In addition to Apple Inc., Amazon.com, Inc., and AbbVie Inc., Eni S.p.A. is a notable stock to invest in.
9. Coterra Energy Inc. (NYSE:CTRA)
Share Price as of April 7: $26.79
Number of Hedge Fund Holders: N/A
Coterra Energy Inc. (NYSE:CTRA) was incorporated in 1989 and is headquartered in Houston, Texas. The company distributes oil, natural gas, and natural gas liquids in the United States. The stock has gained approximately 37% year-to-date. Priced at $26.79, Coterra Energy Inc. is one of the best stocks to buy for beginners right now.
Coterra Energy Inc.’s full-year revenue for 2021 stood at $3.67 billion, up from $1.40 billion in the last year. The company’s 2021 net income of $1.15 billion also increased significantly as compared to the 2020 income of $201 million. Coterra Energy Inc.’s cash and cash equivalents exceeded $1 billion in 2021, versus $140 million in the last year.
Coterra Energy Inc. on March 3 declared a quarterly dividend of $0.15 per share, which is 20% higher than its prior dividend of $0.125. The company also approved a variable dividend of $0.41 per share, making the total payment per share amount to $0.56, which was paid on March 17. The company returns 48% of cash flow from operating activities to shareholders in the form of dividends.
On March 31, Mizuho analyst Vincent Lovaglio reiterated a Buy rating on Coterra Energy Inc. and raised the price target on the shares to $38 from $29. The analyst increased his long-term oil price forecast to $70 per barrel from $61, with his 2022-25 estimates up $16 per barrel on average. The analyst remains positive on the energy sector relative to the broader market.
8. AngloGold Ashanti Limited (NYSE:AU)
Share Price as of April 7: $23.22
Number of Hedge Fund Holders: 15
AngloGold Ashanti Limited (NYSE:AU) is headquartered in Johannesburg, South Africa, operating as a gold mining company in Africa, the Americas, and Australia. The stock has gained more than 34% in the last six months.
AngloGold Ashanti Limited on March 9 declared a $0.145 per share semi-annual dividend. The dividend was distributed on April 4, to shareholders of the company at the close of business on March 11. The stock delivers a dividend yield of 2.83% as of April 7.
Deutsche Bank analyst Liam Fitzpatrick reiterated a Buy recommendation on AngloGold Ashanti Limited and raised the price target on the shares to $28 from $24. The analyst noted that commodity markets are facing an “unprecedented supply shock” from the Russia/Ukraine war, and Chinese demand is set to rebound in the near future. An extended period of Western sanctions on Russia could result in increased resource security and investment in the West, added the analyst.
Among the hedge funds tracked by Insider Monkey in the fourth quarter of 2021, 15 funds reported owning stakes worth $377.7 million in AngloGold Ashanti Limited, compared to 10 funds in the prior quarter, holding stakes in the company valued at approximately $328 million. John Paulson’s Paulson & Co is the biggest shareholder of AngloGold Ashanti Limited, with roughly 6 million shares worth $125.3 million.
7. Esperion Therapeutics, Inc. (NASDAQ:ESPR)
Share Price as of April 7: $5.62
Number of Hedge Fund Holders: 20
Esperion Therapeutics, Inc. (NASDAQ:ESPR) is a Michigan-based pharmaceutical company that develops and commercializes medicines for the treatment of cholesterol and cardiovascular disease. Esperion Therapeutics, Inc.’s FY 2021 net product sales grew 208.89% year-over-year to approximately $40.05 million. Esperion Therapeutics, Inc., priced at $5.62, is one of the best stocks to invest in for beginners.
On March 10, H.C. Wainwright analyst Emanuela Branchetti initiated coverage of Esperion Therapeutics, Inc. with a Buy rating and a $22 price target. The analyst observed that the company’s corporate reset will likely improve the commercial performance of its lead assets ahead of the key inflection point in the first quarter of 2023.
According to Insider Monkey’s Q4 data, 20 hedge funds held long positions in Esperion Therapeutics, Inc., up from 17 funds in the prior quarter. David Kroin’s Deep Track Capital is the leading stakeholder of the company, with 5.6 million shares worth $28.2 million.
Wasatch Micro Cap Value Fund mentioned Esperion Therapeutics Inc. in its Q4 2020 investor letter. Here is what the fund said:
“Another significant detractor was Esperion Therapeutics, Inc. (ESPR), a developer of oral therapies for people with elevated low-density lipoprotein cholesterol (LDL-C, or “bad cholesterol”). Esperion’s recently approved flagship medications, Nexletol® and Nexlizet,™ are intended to increase the effectiveness of statins and other cholesterol-lowering drugs in high-risk patients. However, sales of these new products have been hampered as patients fearful of contracting Covid19 postponed routine physicals and other non urgent appointments during which the medications might have been prescribed. Given the many challenges involved, uptake of the new drugs has been encouraging in our view. We remain optimistic about Esperion’s long-term prospects and continue to own it in the Fund. Having said that, we’re keeping the position size relatively small because we always take a cautious approach to biotech stocks and we’d ideally like to see the company’s balance sheet in somewhat better condition.”
6. Fisker Inc. (NYSE:FSR)
Share Price as of April 7: $13.08
Number of Hedge Fund Holders: 21
Fisker Inc. (NYSE:FSR) is a manufacturer of electric vehicles, headquartered in Manhattan Beach, California. The company was incorporated in 2016 and went public in 2020 via an initial public offering. The stock has gained more than 17% in the last month.
According to Citi analyst Itay Michaeli, Fisker Inc. announced that bookings for the Ocean electric vehicle have surpassed 40,000 units, an increase of approximately 30% compared to mid-February and above the 35,000 units suggested by Citi’s estimates in early March. The analyst said that reservations “appear robust”, with the company indicating that it might sell out most of its 2023 premium models. He sees Fisker Inc. gaining commercial momentum in the near-term and views the update as “encouraging”. The analyst kept a Buy rating on the shares with a $29 price target on April 1.
Among the hedge funds tracked by Insider Monkey, 21 funds were bullish on Fisker Inc. at the end of December 2021, with collective stakes amounting to approximately $240 million, compared to 15 funds holding stakes worth $228 million in Fisker Inc. in the previous quarter.
Just like Apple Inc., Amazon.com, Inc., and AbbVie Inc., elite investors are piling into Fisker Inc..
5. Nomad Foods Limited (NYSE:NOMD)
Share Price as of April 7: $22.10
Number of Hedge Fund Holders: 23
Nomad Foods Limited (NYSE:NOMD) is based in Feltham, United Kingdom, offering frozen food products to supermarkets and food retail chains in the United Kingdom, Italy, Germany, France, Sweden, Austria, Norway, Spain, and other European countries. Priced at $22.10 as of April 7, Nomad Foods Limited is one of the most popular stocks among beginner investors.
As part of a broader research note on Packaged Foods, UBS analyst Cody Ross initiated coverage of Nomad Foods Limited with a Buy rating and a $26 price target on March 30. The analyst observed that consumers are currently “the healthiest they have been in some time”, with high net worths and rising wages. In this inflationary backdrop, the analyst prefers companies that have greater pricing power and can increase margins by innovation and brand equity.
According to Insider Monkey’s fourth quarter database, 23 hedge funds placed long bets on Nomad Foods Limited, with combined stakes valued at approximately $294 million. Renaissance Technologies held the biggest position in the company, with 4.4 million shares worth $112.5 million.
Here is what FAM Funds has to say about Nomad Foods Limited in its Q4 2020 investor letter:
“The proceeds(from a sold equity) were primarily invested into a new idea — Nomad Foods (NOMD), a producer of branded frozen food products in Europe. Product categories include fish, vegetables, and meat substitutes. Management’s plan is to continually improve the brands they control while seeking opportunities to buy and upgrade similar companies. In the past, key members of senior management pursued this strategy at other businesses and created significant returns for shareholders. As COVID-19 rolled across Europe, Nomad became one of the few beneficiaries of the pandemic as consumers stopped visiting restaurants and increasingly ate at home.”
4. BP p.l.c. (NYSE:BP)
Share Price as of April 7: $29.86
Number of Hedge Fund Holders: 26
Headquartered in London, the United Kingdom, BP p.l.c. (NYSE:BP) is an energy company that operates via Gas & Low Carbon Energy, Oil Production & Operations, Customers & Products, and Rosneft segments. Deutsche Bank analyst James Hubbard on March 23 maintained a Buy rating on BP p.l.c. (NYSE:BP) but lowered the firm’s price target on the shares to 450 GBp from 455 GBp.
On March 25, BP p.l.c. (NYSE:BP) announced its plans to spend £1 billion to expand its electric vehicle charging stations in the United Kingdom over the next 10 years. This initiative will meet the increasing demand for clean power, create multiple jobs in the UK economy, and help the country’s transition to low carbon vehicles for both individuals and commercial purposes.
In 2021, BP p.l.c. (NYSE:BP)’s full-year revenue came in at $156.7 billion, compared to $105.6 billion in the previous year. The $7.5 billion net income in 2021 strongly rebounded from the net loss of $20.3 billion in 2020.
BP p.l.c. (NYSE:BP) declared a $0.3276 per share quarterly dividend on February 10, in line with previous. The dividend was paid on March 25, to shareholders of the company as of February 18. BP p.l.c. (NYSE:BP)’s dividend yield on April 7 stood at 4.30%.
According to the fourth quarter database of Insider Monkey, 26 hedge funds were long BP p.l.c. (NYSE:BP), compared to 29 funds in the earlier quarter. Ken Fisher’s Fisher Asset Management is the biggest position holder in the company, with 13.7 million shares worth more than $367 million.
3. BELLUS Health Inc. (NASDAQ:BLU)
Share Price as of April 7: $8.07
Number of Hedge Fund Holders: 26
BELLUS Health Inc. (NASDAQ:BLU) is a Canadian clinical stage biopharmaceutical company that develops treatments for refractory chronic cough and similar cough hypersensitivity issues. The stock has climbed close to 36% in the last six months.
On February 24, H.C. Wainwright analyst Andrew Fein raised the price target on BELLUS Health Inc. to $16 from $14 and reiterated a Buy rating on the shares. With the recent discontinuation of Bayer’s elipixant, a cough medication, and Shionogi’s sivopixant failing in a clinical trial, BELLUS Health Inc.’s BLU-5937 has more chances of commercial success. The product has tested well for tolerability and has less market rivals, the analyst told investors in a bullish thesis.
Hedge fund sentiment around BELLUS Health Inc. was largely positive. Among the hedge funds tracked by Insider Monkey, 26 funds were bullish on BELLUS Health Inc. at the end of December 2021, up from 17 funds in the prior quarter. Peter Kolchinsky’s RA Capital Management is the biggest stakeholder of the company, with 10.2 million shares worth $82.3 million.
2. ACADIA Pharmaceuticals Inc. (NASDAQ:ACAD)
Share Price as of April 7: $27.06
Number of Hedge Fund Holders: 27
ACADIA Pharmaceuticals Inc. (NASDAQ:ACAD) was founded in 1993 and is headquartered in San Diego, California. The company develops and sells small molecule drugs that treat central nervous system disorders. The shares have gained over 57% in the last six months.
On March 16, Canaccord Genuity analyst Sumant Kulkarni upgraded ACADIA Pharmaceuticals Inc. to Buy from Hold and raised the price target to $31 from $30. The company recently announced that the FDA granted an action date of August 4 for its resubmitted application for Nuplazid, a supplemental new drug for Alzheimer’s, the analyst told investors in a research note. He likes ACADIA Pharmaceuticals Inc.’s risk/reward ahead of the Nuplazid decision.
Among the hedge funds tracked by Insider Monkey, 27 funds reported owning stakes in ACADIA Pharmaceuticals Inc. at the end of Q4 2021, compared to 19 funds in the last quarter. The total stakes held in the fourth quarter amounted to $1.35 billion. Julian Baker and Felix Baker’s Baker Bros. Advisors is the leading stakeholder of the company, with approximately $42 million shares worth over $978 million.
1. The AES Corporation (NYSE:AES)
Share Price as of April 7: $25.23
Number of Hedge Fund Holders: 41
The AES Corporation (NYSE:AES) is a Virginia-based power generation and utility company that caters to industrial, residential, commercial, and government customers. The stock has gained more than 16% over the last month.
Citi analyst Ryan Levine on March 22 initiated coverage of The AES Corporation with a Buy rating and a $27 price target. The company’s power assets in California will have extended lives and its renewable development business will gain market share, the analyst told investors. Higher power prices will also be favorable for The AES Corporation.
On February 24, The AES Corporation reported earnings for the fourth quarter, posting an EPS of $0.45, topping market estimates by $0.02. Revenue over the period jumped 8.20% year-over-year to $2.77 billion, outperforming analysts’ predictions by $143.29 million.
The AES Corporation declared on February 25 a $0.158 per share quarterly dividend, in line with previous. The dividend will be paid on May 13, for shareholders of record on April 29. The stock delivers a dividend yield of 2.52% as of April 7.
William B. Gray’s Orbis Investment Management is the biggest shareholder of The AES Corporation, with 14.2 million shares worth $347 million. Overall, 41 hedge funds were bullish on the stock at the end of December 2021.
You can also take a look at 10 Dividend Paying Consumer Defensive Stocks and 10 Most Profitable Biotech Companies in the World.
Follow Insider Monkey on Twitter
Suggested articles:
- 10 Best Long-Term Dividend Stocks with Over 4% Yield
- 10 UK Dividend Stocks To Buy
- 10 Dividend Growth Stocks Popular on Robinhood
This article is originally published at Insider Monkey.
