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.
9. Abbott Laboratories (NYSE:ABT)
Abbott Laboratories (NYSE:ABT) is one of the Best Dip Stocks to Buy According to Hedge Funds. On February 6, Abbott Laboratories (NYSE:ABT) released positive clinical trial results for its Amulet 360 Left Atrial Appendage (LAA) occluder, presented at the AF Symposium in Boston.
Atrial fibrillation is an irregular heart rhythm disease that affects millions of people worldwide and increases the risk of stroke. The device being investigated is called Amulet 360 Left Atrial Appendage (LAA) occluder, a minimally invasive catheter-based therapy.
The VERITAS Study, which presents 12-month data from 34 centers across the US, Europe, Canada, and Australia, showed top-tier performance for paroxysmal AFib and persistent AFib. The trial that enrolled 400 patients showed that after 45 days of implant, 93.9% of the patients achieved complete LAA closure. This includes a 99.8% implant success rate with no major issues recorded, including strokes, device dislodgement, brain bleeds, or surgery-needing heart damage in early follow-up. Management noted that full results for this device are expected in 2027.
Abbott Laboratories (NYSE:ABT) is a global healthcare company that researches, develops, and manufactures medical devices, diagnostic tools, branded generic medicines, and nutritional products.
8. Blackstone Inc. (NYSE:BX)
Blackstone Inc. (NYSE:BX) is one of the Best Dip Stocks to Buy According to Hedge Funds. On February 17, Blackstone Inc. (NYSE:BX) announced that its perpetual private equity strategy fund (BXPE) has entered an agreement to acquire Champions Group from Odyssey Investment Partners.
Champions Group is one of the top home services companies that offers a unique platform with essential residential services, including repairs and replacements in major US metropolitan areas. The group has more than 1,800 field technicians and roughly 150,000 active members enrolled through a subscription model.
Management noted that Champions Group has expanded organically through acquisitions over the past 5 years under Odyssey. The deal aligns with Blackstone Inc.’s (NYSE:BX) aim to expand into a multi-service powerhouse and also fits the company’s strategy to build platforms in fragmented industries such as home services.
While no financial details were disclosed, the deal is expected to close in the first half of 2026 and is pending standard business approvals.
Michael Staub, Senior Managing Director, and Maury Bardovi, Managing Director at Blackstone, said:
“We are thrilled to partner with Frank DiMarco and Odyssey as we continue to build Champions Group into a multi-service residential services platform. By bringing together best-in-class essential services under one umbrella, we have an opportunity to redefine what homeowners expect from a residential services provider—exceptional quality, reliability, and scale, all delivered locally.
Blackstone Inc (NYSE:BX) is an alternative investment management company. It serves institutional and individual investors. With more than $1 trillion of assets under management, Blackstone is the world’s largest alternative asset manager.
7. S&P Global Inc. (NYSE:SPGI)
S&P Global Inc. (NYSE:SPGI) is one of the Best Dip Stocks to Buy According to Hedge Funds. On February 17, S&P Global Inc. (NYSE:SPGI) announced its strategic data-sharing collaboration with Verisk to deliver climate catastrophe risk analytics essential for insurance and finance sectors.
Management noted that the partnership will combine the S&P’s climate projections with Verisk’s insurance modeling, allowing companies to quantify insured and uninsured losses from future climate events. Some of the key components of the partnership include the inclusion of Verisk’s near-term catastrophe risk data feeds in S&P Global Sustainable Climanomics platform, flood projections using Verisk’s Touchstone modeling platform, and “decision-grade” metrics for clients to stress test portfolios.
S&P Global Inc. (NYSE:SPGI) highlighted that recent natural disaster losses call for some forward looking tool that can allow Insurers, asset managers, and banking professionals to make informed decisions.
That said, S&P Global Inc. (NYSE:SPGI) released its fiscal Q4 2025 earnings on February 10. The company grew its revenue by 9.02% year-over-year to $3.92 billion, surpassing estimates by $5.53 million. However, the EPS of $4.30 fell short of the consensus by $0.04. Management attributed growth to be driven by strong performance across all its divisions and strong momentum in private markets.
S&P Global (NYSE:SPGI) is a provider of benchmarking solutions, financial intelligence, data & analytics, and ratings covering automotive, commodity, energy, and capital markets across the globe. The business is structured around 5 distinct segments, i.e., S&P Global Market Intelligence, S&P Global Ratings, S&P Global Energy, S&P Global Mobility, and S&P Dow Jones Indices.
6. Palo Alto Networks, Inc. (NASDAQ:PANW)
Palo Alto Networks, Inc. (NASDAQ:PANW) is one of the Best Dip Stocks to Buy According to Hedge Funds. On February 17, Palo Alto Networks, Inc. (NASDAQ:PANW) announced its intent to acquire Koi, which is a startup specializing in Agentic Endpoint Security.
As AI integration speeds up, the security risk from AI agents and tools grows with it. Management noted that this strategic acquisition will provide additional visibility and control over AI endpoints, which often evade traditional antivirus protections. Management further added that AI agents are Insiders for any company as they read and write data, while also executing orders. These frameworks are at increased risk from attackers who can exploit the agents to bypass logins, gain remote access, and even hijack credentials.
Once Palo Alto Networks, Inc. (NASDAQ:PANW) has acquired Koi, it plans to integrate the company’s security solutions with its Prisma AIRS for broader AI protection. The company also plans to integrate the tools with Cortex XDR to provide enhanced threat visibility and malware protection.
Lee Klarich, Chief Product & Technology Officer, at Palo Alto Networks, noted:
“AI agents and tools are the ultimate insiders. They have full access to your systems and data, but operate entirely outside the view of traditional security controls. By acquiring Koi, we will be closing this gap and setting a new standard for endpoint security.
Palo Alto Networks, Inc. (NASDAQ:PANW) is a global cybersecurity company. It provides next-generation firewall appliances, cloud security, and AI-driven threat intelligence through platforms such as Prisma Cloud and Cortex. The company also offers subscription services for threat prevention, malware protection, and secure access across hybrid and multi-cloud environments.
5. The Progressive Corporation (NYSE:PGR)
The Progressive Corporation (NYSE:PGR) is one of the Best Dip Stocks to Buy According to Hedge Funds. On February 18, The Progressive Corporation (NYSE:PGR) reported its January 2026 results. The company grew its net premiums written by 4% year-over-year to $6.735 billion and net premiums earned by 5% to $6.921 billion. The total net income for the month came in at $1.163 billion, reflecting 4% increase year-over-year.
The pretax net realized gains on securities totaled $103 million for the month, reflecting 6% year-over-year decline from January 2025. Moreover, the total policies in force expanded 10% to 38.75 million from 35.23 million, driven by double-digit gains in agency auto, which grew 10% to $10.855 billion, and direct auto, which grew 14% to $16.164 billion.
Following the announcement, on February 19, Bank of America Securities lowered the price target on The Progressive Corporation (NYSE:PGR) from $329 to $315 and maintained a Buy rating on the stock. The firm noted that the company missed the net investment income forecasts of $322 million. Although this only reflects a $0.03 per share EPS headwind, the firm lowered its core EPS forecasts for PGR.
The Progressive Corporation (NYSE:PGR) is a major American insurance holding company, recognized as the second-largest personal auto insurer and a top commercial auto insurer. It provides insurance for personal/commercial autos, motorcycles, boats, RVs, and homes directly to consumers and via agents.
4. Sanofi (NASDAQ:SNY)
Sanofi (NASDAQ:SNY) is one of the Best Dip Stocks to Buy According to Hedge Funds. On February 17, Sanofi (NASDAQ:SNY) announced Manuela Buxo will replace Brian Foard as the Head of its Specialty Care Global Business Unit. Brian Foard, after serving for nearly 9 years, is leaving on February 28 to take on a leadership role elsewhere.
Manuela Buxo will take over as the Head of Specialty Care Unit on March 1, 2026. She is currently the head of Sanofi’s (NASDAQ:SNY) Global Immunology Alliance Franchise. For the past 2 years, Buxo has been leading the worldwide strategy of Dupixent and brings over 20 years of experience in healthcare. Previously, she has served in Specialty Care roles in Europe and global franchise management.
Management noted that Brian Foard joined Sanofi in 2017 and later assumed the position of head of Specialty Care. Under his leadership, the unit grew significantly, driven by the launch of Dupixent.
Sanofi (NASDAQ:SNY) researches, produces, and distributes pharmaceutical products. The company’s operations are divided into the Pharmaceuticals, Consumer Healthcare, and Vaccines segments.
3. ServiceNow, Inc. (NYSE:NOW)
ServiceNow, Inc. (NYSE:NOW) is one of the Best Dip Stocks to Buy According to Hedge Funds. On February 17, Barron’s reported that ServiceNow, Inc.’s (NYSE:NOW) CEO William “Bill” McDermott bought $3 million worth of company shares on the open market.
This move comes as the “SaaSpocalypse” narrative has overtaken Wall Street and has dragged the sector down by more than 22% since the start of 2026. In addition to the share purchase, the report also highlighted that other executives at ServiceNow also cancelled their planned share sales and noted that they plan to hold the stock.
CEO McDermott noted that he invested his own money to buy shares as he believes there’s no better entry point.
“I’m investing $3M of my own money because I have absolute conviction in the value we’re building… There is no better entry point I can imagine.”
He added that the company presents a once-in-a-generation moment, being at the forefront of AI innovation. However, the move didn’t help revive the share price as it fell roughly 1.30% following the announcement. The share price of ServiceNow, Inc. (NYSE:NOW) has fallen more than 27.3% since the start of 2026.
ServiceNow Inc (NYSE:NOW) is an American software company that provides a cloud-based and AI-driven platform for automating and improving business workflows. Its solutions help businesses increase productivity and maximize outcomes. Its primary operating areas are CRM and Industry, Technology, Core Business, and Creator.
2. Intuit Inc. (NASDAQ:INTU)
Intuit Inc. (NASDAQ:INTU) is one of the Best Dip Stocks to Buy According to Hedge Funds. On February 17, Intuit Inc. (NASDAQ:INTU) launched a new campaign with Uber Advertising to make in-person tax help more accessible by bridging the gap between taxpayers and trusted financial expertise.
This move is part of the company’s strategy to expand its Human Intelligence service network that includes roughly 600 Expert Offices and 20 immersive stores. Moreover, the company is offering free Uber rides, up to $25, to customers through TurboTax to meet their local TurboTax expert.
Management noted that this initiative aligns with the company’s vision to reimagine the tax experience where agentic AI does 90% of the work, followed by a human expert for more specialized outcomes and decision making.
That said, earlier on February 11, Intuit Inc. (NASDAQ:INTU) launched a construction addition to its Enterprise Suite, which is an AI-driven enterprise resource planning tool. Management noted that they are targeting the $2 trillion construction market with the new addition that automates tasks from budget tracking to AIA-style invoicing.
Intuit Inc. (NASDAQ:INTU) is a California-based company that offers products and services, including financial management, payments and capital, and marketing solutions. Founded in 1983, the company operates in four segments: Global Business Solutions, Consumer, Credit Karma, and ProTax.
1. Marsh & McLennan Companies, Inc. (NYSE:MRSH)
Marsh & McLennan Companies, Inc. (NYSE:MRSH) is one of the Best Dip Stocks to Buy According to Hedge Funds. On February 13, Marsh & McLennan Companies, Inc. (NYSE:MRSH) announced that Michael Lewis will now serve as President, Marsh Risk Canada, starting April 1.
Lewis currently serves as Chief Commercial Officer for Arsh Canada and Head of Specialty and Industry for Marsh Risk Canada. The report highlighted that Lewis will keep the CCO role while a replacement is named for the other. Under his new role, Lewis will lead strategy for risk management, corporate and commercial clients, consulting, and specialty insurance broking. He succeeds Sarah Robson, who is Marsh Canada CEO and will report jointly to Michelle Sartain, who is President of Marsh Risk for the US and Canada.
Lewis joined Marsh Risk in 2006 as part of the company’s Workforce Strategies group. He later moved to Hong Kong, where he led the Workforce Strategies group. Finally, he moved to Canada in 2018 as National Growth and Industry Leader.
Following the announcement, Lewis noted:
“I look forward to working closely with our colleagues across Canada to build on the already strong foundation cemented by Sarah and to deliver continued innovation and stellar service to our clients.”
Marsh & McLennan Companies, Inc. (NYSE:MRSH) is a leading professional services firm focused on risk, strategy, and people solutions. It operates through two main segments: Risk and Insurance Services and Consulting.
While we acknowledge the potential of MRSH to grow, our conviction lies in the belief that some AI stocks hold greater promise for delivering higher returns and have limited downside risk. If you are looking for an AI stock that is more promising than MRSH and that has 100x upside potential, check out our report about this cheapest AI stock.
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