In this article, we will take a look at some of the undervalued wide moat stocks to buy now.
Having a trait that sets you apart from others, in a positive way, is a strength. This is particularly true in the case of stocks, and for that, we rely on wide moat stocks. These companies feature a sustainable competitive edge that protects profitability in the long term.
However, the real bargain is when these stocks are trading below their intrinsic value, offering safety with upside potential. Undervalued stocks, as the name suggests, are priced cheaper than what they’re really worth, so they create a buying opportunity for the committed investors.
The term “economic moat” was first coined by Warren Buffett. Later, the Morningstar Wide Moat Focus Index was initiated to identify companies that receive Morningstar Economic Moat Ratings of wide and whose stocks appear cheap in contrast to their valuations. In 2016, the Wide Moat Focus Index surpassed the Morningstar US Market Index benchmark by 10 percentage points.
Our Methodology
We have considered the wide moat stocks that were tracked by the Morningstar Wide Moat Focus Index for 2025. To examine the valuation, we first identified the forward price-to-earnings (P/E) of the stock using Yahoo Finance, and then compared it with the industry average using the Finviz screening tool. Our final selection was based on two metrics: positive upside potential and a lower forward P/E than the industry average. We have ranked these stocks in ascending order of hedge fund holdings, based on Insider Monkey’s database as of Q2 2025.
Why are we interested in the stocks that hedge funds pile into? The reason is simple: our research has shown that we can outperform the market by imitating the top stock picks of the best hedge funds. Our quarterly newsletter’s strategy selects 14 small-cap and large-cap stocks every quarter and has returned 373.4% since May 2014, beating its benchmark by 218 percentage points (see more details here).
10. Salesforce, Inc. (NYSE:CRM)
Number of Hedge funds holding: 29
Unisphere Establishment lifted its holdings in the shares of Salesforce, Inc. (NYSE:CRM) by 23.6% during the first quarter, making the stock its 25th largest position. Following the purchase of 100,000 shares of the company’s stock, the fund management firm now owns 523,000 shares with a worth of $140,352,000, translating to an ownership of 0.05%
Although Salesforce, Inc. (NYSE:CRM) has underperformed the S&P 500 (^GSPC) by almost 14.38% in the last year, analysts remain positive about the company’s long-term rebound and GARP appeal. From robust fundamentals and surging EBIT margins to strong free cash flow and double-digit cRPO growth, the reasons to believe in the company’s future are many.
Like many smart companies embracing AI, Salesforce, Inc. (NYSE:CRM) is moving in the same direction. With Agentforce, Data Cloud, and other such AI platforms progressing rapidly, the company’s efforts towards new revenue streams, and thus future profitability, are further strengthened.
Salesforce, Inc. (NYSE:CRM), incorporated in 1999, is a provider of customer relationship management (CRM) technology that connects enterprises and customers. The core offerings of this California-based company include Agentforce, Data Cloud, Industries AI, Industries AI, and Slack.
9. Thermo Fisher Scientific Inc. (NYSE:TMO)
Number of Hedge funds holding: 31
On Tuesday, Thermo Fisher Scientific Inc. (NYSE:TMO) announced the completion of its Solventum Corporation’s purification and filtration business. This $4.0 billion transaction is aimed at expanding the company’s bioprocessing and adjacent market offerings.
While providing growth and synergy opportunities, this acquisition is anticipated to generate $750 million in revenue for 2025. Not only that, Thermo Fisher Scientific Inc. (NYSE:TMO) will see its product offerings enhanced and market position strengthened, all thanks to cutting-edge filtration technologies.
As Marc N. Casper, the CEO, states,
“The addition of innovative filtration technologies is highly complementary and expands our bioprocessing portfolio to better serve the end-to-end needs of our pharma and biotech customers in this rapidly growing market.”
We can expect Thermo Fisher Scientific Inc. (NYSE:TMO) to deliver meaningful returns in the years ahead. So far, capacity expansion and U.S. reshoring trends have positively influenced bioproduction demand, and with the clinical research market now rebounding, the company is well-positioned for long-term growth.
Thermo Fisher Scientific Inc. (NYSE:TMO) is a Massachusetts-based company operating through four segments: Life Sciences Solutions, Analytical Instruments, Specialty Diagnostics, Laboratory Products, and Biopharma Services. Incorporated in 1956, the giant is committed to making the world a healthy, clean, and safe space.
