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11 High Profit Margin Stocks to Buy According to Hedge Funds

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In this article, we will take a look at 11 High Profit Margin Stocks to Buy According to Hedge Funds.

US equities fell on March 19, with oil prices falling as Wall Street awaited the latest news on the Iran conflict. The drop came after crude futures rose as high as 10% to $119 per barrel as Iran and Israel conducted attacks on critical oil and gas infrastructure. The intensification of hostilities fueled fears of more serious repercussions from the conflict than anticipated. Meanwhile, markets had been wrestling with rising inflation estimates from the Federal Reserve, which lowered expectations for interest rate cuts.

Given that markets seem to be dismissing any rate cuts this year, analysts at Macquarie suspect the Fed’s next move will be in the opposite direction. In notes released before and after the Fed meeting, the firm stated that it believes inflationary pressures are growing and will compel the Fed to raise interest rates sometime next year. Regarding this, the firm stated the following:

“We see the next move as a hike. However, with more mixed signals from the labor market and the potential for consumer headwinds near-term from higher oil, we have now pushed out this timing to 1H27.”

With that backdrop, let’s explore our list of high profit margin stocks to buy according to hedge funds.

Our Methodology

For this list, we used stock screeners to compile a list of companies with a net profit margin above 25%, signaling strong operational efficiency and pricing power. 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 498.7% since May 2014, beating its benchmark by 303 percentage points (see more details here).

11. Trip.com Group Limited (NASDAQ:TCOM)

Trip.com Group Limited (NASDAQ:TCOM) ranks among the best high profit margin stocks to buy. On February 26, Barclays reduced its price target for Trip.com Group Limited (NASDAQ:TCOM) to $75 from $90 while retaining an Overweight rating on the company’s stock. The firm stated that both revenues and earnings came in somewhat higher than originally expected.

Trip.com Group Limited (NASDAQ:TCOM) beat analyst expectations with earnings per share of $4.97, compared to $4.77. In addition, the company generated $15.4 billion in revenue, which exceeded the predicted $14.86 billion. However, the slightly higher revenues were partially offset by marginally higher fourth-quarter expenses, while gross margins were stable at 81%.

Trip.com demonstrated particularly strong growth, with foreign reservations up 60% year-over-year in 2025 and 2026 to date, as well as in outbound travel. Management also issued a positive first-quarter outlook, citing sustained momentum experienced quarter-to-date, particularly with regard to Chinese New Year travel demand.

Global travel service company Trip.com Group Limited (NASDAQ:TCOM) provides end-to-end solutions for the corporate travel, lodging, tour, and transportation sectors.

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The $250 Trillion AI Hype is Real. A few years from now, you’ll probably wish you’d bought this stock.

When Jeff Bezos said that one breakthrough technology would shape Amazon’s destiny, even Wall Street’s biggest analysts were caught off guard.

Fast forward a year and Amazon’s new CEO Andy Jassy described generative AI as a “once-in-a-lifetime” technology that is already being used across Amazon to reinvent customer experiences.

At the 8th Future Investment Initiative conference, Elon Musk predicted that by 2040 there would be at least 10 billion humanoid robots, with each priced between $20,000 and $25,000.

Do the math. According to Musk, this technology could be worth $250 trillion by 2040.

Put another way, that’s roughly equal to:

  • 175 Teslas
  • 107 Amazons
  • 140 Metas
  • 84 Googles
  • 65 Microsofts
  • And 55 Nvidias

And here’s the wild part — this $250 trillion wave isn’t tied to one company, but to an entire ecosystem of AI innovators set to reshape the global economy.

It’s a leap so massive, it could reshape how businesses, governments, and consumers operate worldwide.

Even if that $250 trillion figure sounds ambitious, major firms like PwC and McKinsey still see AI unlocking multi-trillion-dollar potential.

How could anything be worth that much?

The answer lies in a breakthrough so powerful it’s redefining how humanity works, learns, and creates.

And this breakthrough has already set off a frenzy among hedge funds and Wall Street’s top investors.

What most investors don’t realize is that one under-owned company holds the key to this $250 trillion revolution.

In fact, Verge argues this company’s supercheap AI technology should concern rivals.

Before I reveal the details, let’s talk about how some of the richest people on the planet are positioning themselves.

  • Bill Gates sees artificial intelligence as the “biggest technological advance in my lifetime,” more transformative than the internet or personal computer, capable of improving healthcare, education, and addressing climate change.
  • Larry Ellison — through Oracle, is spending billions on Nvidia chips and partnering with Cohere to embed generative AI across Oracle’s cloud and apps.
  • Warren Buffett — not known for tech hype — says this breakthrough could have a ‘hugely beneficial social impact.

When billionaires from Silicon Valley to Wall Street line up behind the same idea — you know it’s worth paying attention to.

Even as we admire what Tesla, Nvidia, Alphabet, and Microsoft have built, we believe an even greater opportunity lies elsewhere…

But the real story isn’t Nvidia — it’s a much smaller company quietly improving the critical technology that makes this entire revolution possible.

And judging by what I’m hearing from both Silicon Valley insiders and Wall Street veterans…

This prediction might not be bold at all:

A few years from now, you’ll wish you’d owned this stock.

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