In this article, we will look at the 11 Best Dip Stocks to Buy According to Hedge Funds.
On February 17, Mohamed El-Erian, Chief Economic Advisor at Allianz, appeared on a CNBC Television interview to discuss the way forward amidst the volatility. He noted that we are in a completely different market as compared to 2025, as there is no longer the investor’s love for AI. El-Erian highlighted that the current market is defined and will continue to be defined by three words: volatility, dispersion, and fragmentation. He added that the market is likely to experience greater dispersion than it did in 2025.
While talking about the best approach to build a portfolio under current market circumstances, El-Erian noted that he would build his portfolio bottom-up. He added that he would pick up names from the sectors that have fallen down. El-Erian explained that the market tends to draw a correlation linking one technical issue to all the stocks in the sector. He highlighted the current market drawdown as a massive opportunity for picking good stocks with strong balance sheets, particularly in the areas where AI has impacted the most.
With that, let’s take a look at the 11 Best Dip Stocks to Buy According to Hedge Funds.
Our Methodology
We used screeners to identify stocks that are trading within 0-10% of their 52-week lows, and limited our final selection to companies that have recently reported noteworthy developments likely to impact investor sentiment. These stocks are also popular among analysts and elite hedge funds.
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 427.7% since May 2014, beating its benchmark by 264 percentage points (see more details here).
11 Best Dip Stocks to Buy According to Hedge Funds
11. Visa Inc. (NYSE:V)
Visa Inc. (NYSE:V) is one of the Best Dip Stocks to Buy According to Hedge Funds. On February 19, Visa Inc. (NYSE:V) announced that it has agreed to buy two key payment companies, including Prisma Medios de Pago and Newpay, from Advent International.
Management noted that these strategic acquisitions will boost the company’s presence in Argentina, where digital payments are growing rapidly. The acquisitions will help Visa dominate the market by combining the local presence of these companies with Visa’s global technology.
Prisma specializes in processing backend for credit, debit, and prepaid cards issued by banks. On the other hand, Newpay has the essential infrastructure, including the Banelco ATM network, along with real-time payment services, and the PagoMisCuentas platform.
Gabriela Renaudo, group country manager, Visa Argentina and Southern Cone, said:
”We see significant opportunities to expand digital payments adoption and modernize financial services, capabilities, and infrastructure across the country.”
As per the management, some of the key strategic benefits of these deals include the rapid rollout of cutting-edge features in Argentina, such as tokenization, biometric authentication, and agentic commerce solutions.
The deal is still pending approval from shareholders and is expected to close in fiscal Q2 2026.
Visa Inc. (NYSE:V) offers digital payment services. Furthermore, it makes global commerce simpler by transferring information and value across a worldwide network of firms, financial institutions, government agencies, merchants, consumers, and key partners.
10. SAP SE (NYSE:SAP)
SAP SE (NYSE:SAP) is one of the Best Dip Stocks to Buy According to Hedge Funds. On February 19, SAP SE (NYSE:SAP) reported that the Supervisory Board and Executive Board of the company have proposed a raise of €0.15 per share in its annual dividend for fiscal year 2025. After the raise, the annual dividend will reach €2.50 per share, representing a 6.4% increase year-over-year.
Once approved by the shareholders, the total payout will amount to €2.919 billion, up from €2.743 billion paid in fiscal 2024. Moreover, the payout ratio drops to 40.7% from 52.0% in fiscal 2024, aligning with the company’s policy of distributing at least 40% of non-IFRS profit after tax.
That said, SAP SE (NYSE:SAP) released its fiscal Q4 2025 results on January 28. The company grew its quarterly revenue by 18.46% year-over-year to reach $11.59 billion, but fell short of expectations by $66.21 million. On the bright side, the EPS of $1.93 topped the consensus by $0.21.
The quarterly performance was driven by a 23% year-over-year growth in Cloud revenue and 28% growth in Cloud ERP Suite revenue. Cloud Revenue reached €21.023 billion, while the Cloud ERP Suite revenue totaled €18.119 billion. Notably, the company increased its current Cloud backlog to €21.052 billion, reflecting a 16% increase year-over-year.
SAP SE (NYSE:SAP) develops enterprise application software, primarily ERP systems that centralize data management and streamline business processes like finance, supply chain, and HR.
