In this article, we will look at the 11 best hot stocks to buy right now.
One of Wall Street’s Biggest Bull Slashes Forecast
On October 17 John Stoltzfus, chief investment strategist at Oppenheimer, slashed his year-end price target for the S&P 500 from 4,800 points to 4,000. Though this is down 17% from the bank’s prior target, it still implies a 10% upside from current levels. John Stoltzfus noted that his projections for the end of 2022 factor in a “massive rally short of a miracle” based on the current uncertainty and volatility in the markets. Stoltzfus does not see the Fed pivoting by year-end, however, he sees the market in an “extremely oversold” condition” which can “become a catalyst for a modest rally” as we approach the end of the year.
Analyst Sees Stocks Rallying in the Short Term
On October 17 Morgan Stanley CIO, Mike Wilson, appeared on a call with CNBC where he pointed out that his “intermediate-term view is more constructive” and explained why he sees a rally in stocks in the short term. Mike Wilson said that he does not think it is a “cost-push inflation” situation, it is rather a “demand-pull inflation” situation and is “very serious”. Here are some comments from Mike Wilson:
“We think an earnings recession, and a technical recession at some point, will play through and that’s not fully priced… We’ve had a bearish view all year, we think the 200-week moving average is a really important technical level that a lot of people don’t talk about… The bear market is not over, but you can have major moves off of these technical support levels… We’ve been bearish all year and it’s time for some relief…
We overheated, the Fed reacted to that, financial conditions are tightening, and now we are gonna feel the effects of that on growth, mostly next year. the good news is the market has already discounted almost 100% of what the Fed’s done at this point and I would say that they have discounted very little of the earnings impact that’s going to be felt next year…
We’re not calling for rates to fall down, but maybe they will just stop going up, and that can be enough for equity markets to get excited…”
As of October 17, the S&P 500 has tanked 23% year to date, the Nasdaq is down 32% for the year, and the Dow has lost about 17% since the beginning of 2022. Markets have been hit hard amid high inflation, rising interest rates, and supply-demand imbalances. However, for long-term investors, now might be the time to rack up shares of some of the best-in-class stocks while they are trading at bargain levels. Some of the best momentum stocks to buy now include Constellation Energy Corporation (NASDAQ:CEG), Occidental Petroleum Corporation (NYSE:OXY), and Peabody Energy Corporation (NYSE:BTU).
Photo by Ishant Mishra on Unsplash
Our Methodology
To determine the best hot stocks to buy right now, we screened for companies that have been gaining in 2022. We narrowed down our selection to stocks that are up more than 30% for the year, as of October 14, and also took into account other factors that will propel them to gain further into year-end. We also gave weight to the hedge fund sentiment and analyst ratings for our picks and ranked them according to their year-to-date performance, from lowest to highest.
Best Hot Stocks To Buy Right Now
11. CF Industries Holdings, Inc. (NYSE:CF)
YTD Return as of October 17: 42%
Number of Hedge Fund Holders: 52
CF Industries Holdings, Inc. (NYSE:CF) is a leading American manufacturer of agricultural fertilizers. The company’s primary products include anhydrous ammonia, granular urea, urea ammonium nitrate, and ammonium nitrate. At the end of Q2 2022, 52 hedge funds were long CF Industries Holdings, Inc. and held stakes worth $1.33 billion in the company.
Wall Street is bullish on CF Industries Holdings, Inc.. On October 3, RBC Capital analyst Andrew Wong upgraded CF Industries Holdings, Inc. to Outperform from Sector Perform and raised his price target to $135 from $110. On October 4, Citi analyst P.J. Juvekar raised his price target on CF Industries Holdings, Inc. to $120 from $117 and reiterated a Buy rating on the shares. As of October 17, CF Industries Holdings, Inc. has gained 42% year to date and has a 3-month average trading volume of 2.47 million. The stock is one of the best momentum stocks to buy now.
As of June 30, Soroban Capital Partners is the largest shareholder in CF Industries Holdings, Inc. and has stakes worth $213.28 million in the company.
Here is what Carillon Carillon Tower Advisers had to say about CF Industries Holdings, Inc. in its first-quarter 2022 investor letter:
“Stock selection contributed the most while sector allocation was also positive. An underweight to communication services and an overweight to energy helped performance, while an underweight to consumer staples and an overweight to materials detracted. Stock selection was strong within healthcare and materials but was weak within information technology and industrials. CF Industries (NYSE:CF) manufactures and distributes nitrogen fertilizer. The stock rose as Russia’s invasion of Ukraine accelerated already rising fertilizer prices.”
10. First Horizon National Corporation (NYSE:FHN)
YTD Return as of October 17: 43.25%
Number of Hedge Fund Holders: 43
First Horizon National Corporation (NYSE:FHN) is one of the largest banks in southeast America and is among the best momentum stocks to buy now. As of October 17, the stock has gained 43.25% year to date. First Horizon National Corporation is awarding investors with a strong dividend and is a cash-rich company to invest in. As of October 17, the stock is offering a forward dividend yield of 2.5% and the company has free cash flows of $1.19 billion.
On October 18, First Horizon National Corporation announced earnings for the fiscal third quarter of 2022. The company reported earnings per share of $0.44 and beat expectations by $0.01. The company generated a revenue of $875 million for the quarter, up 18.6% year over year, and outperformed Wall Street consensus by $55.17 million.
At the end of Q2 2022, First Horizon National Corporation was spotted on 43 investment portfolios. The collective stakes of these hedge funds amounted to $1.09 billion. This is compared to 44 positions in the preceding quarter with stakes worth $1.05 billion. As of June 30, Segantii Capital is the most prominent investor in First Horizon National Corporation and has stakes worth $259.97 million in the company.
Here is what Ave Maria had to say about First Horizon Corporation in its second-quarter 2022 investor letter:
“First Horizon Corporation (NYSE:FHN) is a leading regional bank that merged with IBERIABANK Corporation in 2020 forming a regional financial services company with 412 branches across 12 southern states. On February 28, 2022, The Toronto-Dominion Bank (TD Bank) reached an agreement with First Horizon Corporation to acquire the bank for $25 per share.”
9. Itaú Unibanco Holding S.A. (NYSE:ITUB)
YTD Return as of October 17: 45%
Number of Hedge Fund Holders: 11
Itaú Unibanco Holding S.A. (NYSE:ITUB) is a major Brazilian financial services company. On September 29, Goldman Sachs analyst Tito Labarta raised his price target on Itaú Unibanco Holding S.A. to $7 from $5.40 and upgraded the stock to Buy from Neutral. The analyst is bullish on the company’s “superior” profitability, diversified operations, and “resilient” asset quality.
Itaú Unibanco Holding S.A. is one of the best momentum stocks to invest in right now. The stock has pulled back significantly and is presenting an attractive entry point for investors. As of October 17, Itaú Unibanco Holding S.A. is trading at a PE multiple of 10x and has gained 45% year to date. Itaú Unibanco Holding S.A. is profitable and cash-rich. The company has free cash flows of R$127.8 billion and has a trailing twelve-month operating margin of 38.63%.
At the end of Q2 2022, 11 hedge funds were bullish on Itaú Unibanco Holding S.A. and held stakes worth $397.5 million in the company. As of June 30, Orbis Investment Management is the leading shareholder in Itaú Unibanco Holding S.A. and has stakes worth $127.7 million in the company.
8. Centrais Eletricas Brasileiras SA (NYSE:EBR)
YTD Return as of October 17: 52%
Number of Hedge Fund Holders: 10
Centrais Eletricas Brasileiras SA (NYSE:EBR) is a major Brazilian utility and power generation company. The stock is trading at bargain levels and is also attracting a lot of attention on Wall Street. As of October 17, the stock is trading at a trailing twelve-month PE ratio of 10.96 and has a 3-month average volume of 1.73 million. The stock is among the best momentum stocks to invest in right now and is up 52% for the year, as of October 17.
Wall Street analysts like Centrais Eletricas Brasileiras SA. This August, Bradesco BBI analyst Francisco Navarrete upgraded Centrais Eletricas Brasileiras SA to Outperform from Neutral and reiterated his R$70 price target on the shares. On September 23, Citi analyst Antonio Junqueira took coverage of Centrais Eletricas Brasileiras SA with a Buy rating and gave the shares a price target of R$66.
At the end of Q2 2022, Centrais Eletricas Brasileiras SA was spotted on 10 hedge fund portfolios. The total stakes of these hedge funds amounted to $30.2 million, up from $7.5 million in the previous quarter with 7 positions. The hedge fund sentiment for the stock is positive.
As of June 30, Zimmer Partners is the top shareholder in Centrais Eletricas Brasileiras SA and has stakes worth $16.4 million in the company.
In addition to Centrais Eletricas Brasileiras SA, other stocks that are up more than 50% for the year, as of October 14, include Constellation Energy Corporation, Occidental Petroleum Corporation, and Peabody Energy Corporation.
7. Exxon Mobil Corporation (NYSE:XOM)
YTD Return as of October 17: 59%
Number of Hedge Fund Holders: 72
Exxon Mobil Corporation (NYSE:XOM) is one of the best momentum stocks to buy now. As of October 17, the stock has gained 59% year to date. The company is profitable and cash-rich and has a trailing twelve-month operating margin of 14% and has free cash flows of $49.2 billion. As of June 30, GQG Partners is the largest shareholder in Exxon Mobil Corporation and has stakes worth $4.06 billion in the company.
Exxon Mobil Corporation is trading cheaply relative to earnings and is also awarding shareholders with dividend payouts. As of October 17, the stock is trading at a PE multiple of 11x and is offering a forward dividend yield of 3.50%.
On October 7, Wells Fargo analyst Roger Read revised his price target on Exxon Mobil Corporation to $109 from $116 and maintained an Overweight rating on the shares. Over the past three months, the stock has received 7 Buy ratings and 4 Hold ratings from Wall Street analysts.
At the end of Q2 2022, 72 hedge funds held stakes in Exxon Mobil Corporation. The total value of these stakes amounted to $7.40 billion.
Here is what First Eagle Investments had to say about Exxon Mobil Corporation in its second-quarter 2022 investor letter:
“Integrated oil and gas giant Exxon Mobil performed well in the second quarter as continued high prices for energy products supported the stock. As the largest refiner in the US, the company has benefitted from wide “crack spreads,” or the margin between the cost of crude oil and the petroleum products extracted from it. Exxon continues to invest in refining capacity in the US, which industrywide has been in steady decline since 2019. We are pleased that Exxon has been using its strong cash flows to reduce debt and to return cash to shareholders through dividends and stock repurchases.”
Some of the best momentum stocks to buy right now, while they are still coming cheap, include Constellation Energy Corporation, Occidental Petroleum Corporation, and Peabody Energy Corporation.
6. Nordic American Tankers Ltd (NYSE:NAT)
YTD Return as of October 17: 62%
Number of Hedge Fund Holders: 7
Nordic American Tankers Ltd (NYSE:NAT) is a global tanker company that owns and operates double-hull crude oil tankers. The stock is attracting a lot of attention on Wall Street and is one of the best momentum stocks to invest in. As of October 17, Nordic American Tankers Ltd has gained 62% year to date and has an average 3-month volume of 5.17 million.
On August 30, Alexander Hansson, a board member of Nordic American Tankers Ltd disclosed the purchase of 175,000 shares of the company’s common stock at $2.3665 per share. Alexander Hansson has disclosed that he privately owns roughly 1.92 million shares of Nordic American Tankers Ltd.
Wall Street is bullish on Nordic American Tankers Ltd. On September 6, Jefferies analyst Omar Nokta raised his price target on Nordic American Tankers Ltd to $4 from $3 and upgraded the stock to Buy from Hold.
At the end of Q2 2022, 7 hedge funds disclosed ownership of stakes in Nordic American Tankers Ltd. The total stakes of these hedge funds amounted to $16.8 million, up from $16.4 million in the preceding quarter with 7 positions. As of June 30, Millennium Management is the most prominent investor in Nordic American Tankers Ltd and has stakes worth $5.81 million in the company.
5. Unum Group (NYSE:UNM)
YTD Return as of October 17: 66%
Number of Hedge Fund Holders: 25
Unum Group (NYSE:UNM) is a leading American insurance company that provides various financial protection benefit solutions in the United States, the United Kingdom, and Poland. At the end of Q2 2022, 25 hedge funds held stakes in Unum Group worth $436 million. This is compared to 30 positions in the previous quarter with stakes worth $323.5 million.
This October, JPMorgan analyst Jimmy Bhullar raised his price target on Unum Group to $42 from $36 and maintained a Neutral rating on the shares. On October 7, Truist analyst Mark Hughes raised his price target on Unum Group to $48 from $44 and reiterated a Buy rating on the shares.
On October 14, Unum Group declared a quarterly cash dividend of $0.33 per share of the company’s common stock. The dividend is payable on November 18 to stockholders of record on October 28. Unum Group is up 66% for the year and is offering a forward dividend yield of 3.16%, as of October 14. Unum Group is one of the best momentum stocks to buy now.
As of June 30, Viking Global is the leading shareholder in Unum Group and has stakes worth $146.6 million in the company.
4. Sociedad Quimica y Minera (NYSE:SQM)
YTD Return as of October 17: 72%
Number of Hedge Fund Holders: 29
Sociedad Quimica y Minera (NYSE:SQM) is a leading Chilean chemical company and one of the world’s largest producers of lithium. Sociedad Quimica y Minera has pulled back in 2022 and now can be an optimal time to invest in the stock. As of October 17, the stock is trading at a PE multiple of 12x and is awarding stockholders with a dividend yield of 12.73%. The company has a trailing twelve-month operating margin of 48.4% and free cash flows of $1.35 billion. Sociedad Quimica y Minera is up 72% for the year, as of October 14, and is ranked high among the best momentum stocks to buy now.
This September, BMO Capital analyst Joel Jackson raised his price target on Sociedad Quimica y Minera to $130 from $125 and maintained an Outperform rating on the shares. On October 4, Deutsche Bank analyst Corinne Blanchard raised his price target on Sociedad Quimica y Minera to $128 from $125 and reiterated a Buy rating on the shares.
At the end of Q2 2022, 29 hedge funds were long Sociedad Quimica y Minera and held stakes worth $658.6 million in the company. This is compared to 28 positions in the previous quarter with stakes worth $493.2 million. The hedge fund sentiment for the stock is positive. As of June 30, Marshall Wace LLP is the largest shareholder in Sociedad Quimica y Minera and has stakes worth $147.7 million in the company.
3. Constellation Energy Corporation (NASDAQ:CEG)
YTD Return as of October 17: 103%
Number of Hedge Fund Holders: 43
Constellation Energy Corporation operates as a power generation and electricity utility company in the United States. Constellation Energy Corporation has gained 103% year to date and has a 3-month average trading volume of 2.37 million, as of October 14. Constellation Energy Corporation is one of the best momentum stocks to invest in.
Wall Street sees material upside to Constellation Energy Corporation. This August, Morgan Stanley analyst Stephen Byrd raised his price target on Constellation Energy Corporation to $95 from $64 and reiterated an Overweight rating on the shares. On October 3, Credit Suisse analyst Nicholas Campanella took coverage of Constellation Energy Corporation with an Outperform rating and a $98 price target.
At the close of Q2 2022, Constellation Energy Corporation was a part of 43 investment portfolios. The collective stakes of these hedge funds amounted to $1.20 billion, up from $1.12 billion in the preceding quarter with 47 positions. As of June 30, Southpoint Capital Advisors is the top shareholder in Constellation Energy Corporation and has stakes worth $171.78 million in the company.
Here is what Heartland Advisors had to say about Constellation Energy Corporation in its third-quarter 2022 investor letter:
“Our best-performing holding in the quarter was Constellation Energy Corporation (NASDAQ:CEG) in the utilities sector. CEG is a great example of “deep value” holding with a self-help catalyst and is the leading provider of clean energy in the U.S., derived primarily from nuclear power. Earlier this year, the company was spun-off from a prior long-term utility holding. Post spin-off, we increased our position in CEG on the belief that the company was materially undervalued and catalysts were in place to change investors’ perception.
One of those catalysts was the August passage of the Inflation Reduction Act of 2022. Nuclear power has never benefitted from its zero-carbon emitting properties, like wind and solar. This legislation provides nuclear power plants with zero-carbon treatment, establishing a “floor” under power prices that could protect CEG from much of the potential downside swings in commodity power prices.”
2. Occidental Petroleum Corporation (NYSE:OXY)
YTD Return as of October 17: 120.70%
Number of Hedge Fund Holders: 66
Occidental Petroleum Corporation is among the most profitable and cash-rich momentum stocks to buy now. The stock is also trading cheaply relative to earnings and is providing investors with an attractive buying opportunity. As of October 17, the stock has gained 120.70% year to date and is trading at a PE multiple of 6x. The company has a trailing twelve-month operating margin of 34% and free cash flows of $11.47 billion.
This September, Morgan Stanley analyst Devin McDermott raised his price target on Occidental Petroleum Corporation to $76 from $70 and reiterated an Equal Weight rating on the shares. On September 12, Piper Sandler analyst Ryan Todd revised his price target on Occidental Petroleum Corporation to $92 from $93 and maintained an Overweight rating on the shares.
At the close of Q2 2022, 66 hedge funds were bullish on Occidental Petroleum Corporation and held stakes worth $13.75 billion in the company. This is compared to 67 hedge funds in Q1 2022 with stakes worth $12.61 billion. As of June 30, Berkshire Hathaway is the largest shareholder in Occidental Petroleum Corporation and has stakes worth $9.33 billion in the company.
Here is what Smead Capital Management had to say about Occidental Petroleum Corporation in its second-quarter 2022 investor letter:
“For the quarter, our best-performing stocks were Continental Resources (CLR), Merck (MRK) and Occidental Petroleum Corporation (NYSE:OXY). Despite a steep sell-off in June in the oil and gas stocks, two of our oil stocks made the quarterly list.
If you are wondering how we are outperforming the S&P 500 Index in the first half of the year, look no further than our top three performers. Occidental Petroleum (OXY), Continental Resources (CLR) and Conoco Phillips (COP) soared in value and were barely represented in the S&P 500 Index. To quote Jerry Jones, owner of the Dallas Cowboys, “We are in the first quarter on higher energy prices!””
1. Peabody Energy Corporation (NYSE:BTU)
YTD Return as of October 17: 135.80%
Number of Hedge Fund Holders: 29
Peabody Energy Corporation is a leading coal mining company that has operations in the United States, Japan, Taiwan, Australia, India, Indonesia, China, Vietnam, South Korea, and international markets. The company has four divisions: Seaborne Thermal Mining, Seaborne Metallurgical Mining, Powder River Basin Mining, and Other U.S. Thermal Mining. At the end of Q2 2022, 29 hedge funds disclosed ownership of stakes in Peabody Energy Corporation. The total stakes of these hedge funds amounted to $867.3 million. As of June 30, Elliott Management is the top shareholder in Peabody Energy Corporation and has stakes worth $551.59 million in the company.
Peabody Energy Corporation is creating a lot of activity on Wall Street and as of October 17, the stock has surged 135.80% year to date and has a 3-month average trading volume of 5.5 million. The company has free cash flows of $301.7 million and has a trailing twelve-month operating margin of 17.20%. Peabody Energy Corporation is trading at attractive valuations and presenting investors an opportunity to rack up shares of the stock into weakness. As of October 17, the stock is trading at a PE multiple of 4x. Peabody Energy Corporation is one of the best momentum stocks to buy now.
On October 11, B. Riley analyst Lucas Pipes raised his price target on Peabody Energy Corporation to $31 from $28 and reiterated a Buy rating on the shares. Over the past three months, the stock has received 2 Buy ratings and 1 Hold rating from Wall Street analysts and has a consensus Buy rating. The stock’s average price target of roughly $29 implies an upside of 10.39% from current levels.
You can also take a look at 10 Best LNG Stocks To Buy and 10 Best Value Stocks To Buy.
Follow Insider Monkey on Twitter
Suggested articles:
- 11 Best Nanocap Stocks To Invest In
- 11 Best Dividend Stocks To Buy According To Warren Buffett
- 12 Best New Stocks To Buy Now
This article is originally published at Insider Monkey.
