In this article, we discuss the 15 best strong buy stocks to invest in.
Top economic experts in the United States have warned of the US economy slipping into a recession in 2023 despite recent numbers from the government that indicate the economy might be on a rebound path following two consecutive quarters of contraction. Goldman Sachs CEO David Solomon and JPMorgan CEO Jamie Dimon have both recently outlined fears of a sharp slowdown in the economy as the central bank continues with an aggressive rate hike policy intended to curb inflation by raising borrowing costs.
Solomon recently said that economic conditions would tighten meaningfully, noting that “until you get to that point where you see a change in labor or demand, you are going to see central banks continue to move on that trajectory”. Meanwhile, Dimon has also echoed these comments, noting that excess money was running out for American consumers. Some of the top stocks to monitor in this context include UnitedHealth Group Incorporated (NYSE:UNH), Fidelity National Information Services, Inc. (NYSE:FIS), and Prologis, Inc. (NYSE:PLD).
Our Methodology
The companies that were recently given a Strong Buy rating by investment advisory Raymond James were selected for the list. In order to provide readers with some context for their investment choices, the business fundamentals and analyst ratings for the stocks are also discussed. Data from around 900 elite hedge funds tracked by Insider Monkey in the second quarter of 2022 was used to identify the number of hedge funds that hold stakes in each firm.
Best Strong Buy Stocks To Invest In
15. NexPoint Real Estate Finance, Inc. (NYSE:NREF)
Number of Hedge Fund Holders: 7
NexPoint Real Estate Finance, Inc. (NYSE:NREF) operates as a real estate finance company in the United States. It is one of the best strong buy stocks to invest in. On September 21, NexPoint Real Estate Finance declared that its board of directors has declared a dividend of $0.053125 per share of NREF’s 8.50% Series A Cumulative Redeemable Preferred Stock, payable to stockholders of record.
On October 18, Analyst Raymond James maintained a Strong Buy rating on NexPoint Real Estate Finance, Inc. stock with a price target of $21.
At the end of the second quarter of 2022, 7 hedge funds in the database of Insider Monkey held stakes worth $138 million in NexPoint Real Estate Finance, Inc., compared to 12 in the previous quarter worth $156.5 million.
Just like UnitedHealth Group Incorporated, Fidelity National Information Services, Inc., and Prologis, Inc., NexPoint Real Estate Finance, Inc. is one of the best stocks to buy now according to elite investors.
14. Federal Signal Corporation (NYSE:FSS)
Number of Hedge Fund Holders: 9
Federal Signal Corporation (NYSE:FSS) designs, manufactures and supplies a suite of products and integrated solutions for municipal, governmental, industrial, and commercial customers internationally. On September 7, Federal Signal Corp announced that it has signed a definitive agreement to acquire all the assets and operations of TowHaul Group. The payment was done in cash of $46.1 million. The acquisition also includes the manufacturing facility of TowHaul in Montana.
On October 20, Raymond James maintained a Strong Buy rating on Federal Signal Corporation stock and adjusted the price target to $52 from $45.
Among the hedge funds being tracked by Insider Monkey, New York-based investment firm GAMCO Investors is a leading shareholder in Federal Signal Corporation with 587,010 shares worth more than $20.9 million.
13. TPG RE Finance Trust, Inc. (NYSE:TRTX)
Number of Hedge Fund Holders: 13
TPG RE Finance Trust, Inc. (NYSE:TRTX) a commercial real estate finance company that originates, acquires, and manages commercial mortgage loans and other commercial real estate-related debt instruments in the United States. It is one of the top strong buy stocks to invest in. On February 16, TPG RE Finance Trust stated that it closed TRTX 2022 -FL5, a $1.075 billion managed commercial real estate Collateralized Loan Obligation. The company placed $907 million of investment-grade bonds with institutional investors.
On October 18, Raymond James maintained a Strong Buy rating on TPG RE Finance Trust stock with a price target of $11.5.
Among the hedge funds being tracked by Insider Monkey, California-based investment firm Brevan Howard is a leading shareholder in TPG RE Finance Trust, Inc. with 707,942 shares worth more than $6.4million.
12. Redwood Trust, Inc. (NYSE:RWT)
Number of Hedge Fund Holders: 14
Redwood Trust, Inc. (NYSE:RWT) operates as a specialty finance company in the United States. On July 28, Redwood Trust announced a $125 million stock repurchase program. This program replaced the company’s existing $100 million repurchase program and it has no time limits and may be modified, discontinued and suspended at any time.
On October 18, Analyst Raymond James maintained a Strong Buy rating on Redwood Trust, Inc. stock with a price target of $11.5.
At the end of the second quarter of 2022, 14 hedge funds in the database of Insider Monkey held stakes worth $39.96 million in Redwood Trust, Inc., compared to 16 in the previous quarter worth $75 million.
In its Q2 2022 investor letter, ClearBridge Investments, an asset management firm, highlighted a few stocks and Redwood Trust, Inc. was one of them. Here is what the fund said:
“We took advantage of the selloff in the financials sector to add a new position in Redwood Trust, Inc.. The company operates as a speciality finance company within the residential mortgage banking and business purpose mortgage banking industries and capitalized as large investment banks shed their mortgage securitization businesses after the 2008 Great Financial Crisis (GFC). Redwood has since expanded to become the industry leader in the distribution of loans through whole loan sales.
Additionally, its investment portfolio has been very strong historically, even in the GFC, and its expansion into banking has made it better. We believe that the company’s long-term value creation is substantially underrepresented in its current market price and look forward to it being a high-quality long-term compounder within the portfolio.”
11. Cushman & Wakefield plc (NYSE:CWK)
Number of Hedge Fund Holders: 17
Cushman & Wakefield plc (NYSE:CWK) provides commercial real estate services under the Cushman & Wakefield brand. It is one of the premier strong buy stocks to invest in. On August 8, Cushman & Wakefield revealed that it has acquired Burbage Realty Partners, a specialist in UK logistics and industrial. The strategic acquisition provides strength to Cushman & Wakefield’s UK logistics and industrial team.
On October 20, Raymond James maintained a Strong Buy rating on Cushman & Wakefield plc. (NYSE:CWK) stock with a price target of $30.
At the end of the second quarter of 2022, 17 hedge funds in the database of Insider Monkey held stakes worth $142.6 million in Cushman & Wakefield plc (NYSE:CWK), compared to 18 in the preceding quarter worth $212.6 million.
In its Q2 2022 investor letter, Polen Capital, an asset management firm, highlighted a few stocks and Cushman & Wakefield plc (NYSE:CWK) was one of them. Here is what the fund said:
“U.S.-domiciled Cushman & Wakefield plc (NYSE:CWK) is one of the largest companies in the commercial real estate brokerage industry, a sector that is consolidating as scale has differentiated large competitors from their smaller peers. This has enabled large industry participants, such as Cushman & Wakefield, to gain significant market share in transactional business lines like leasing brokerage and capital markets while simultaneously building significant outsourcing businesses with contractual revenue streams. We expect the company to continue growing its market share over time as economies of scale also drive gradual improvement in profit margins. Despite this strong outlook, Cushman & Wakefield is trading at a mid-single-digit multiple of current-year earnings—a material discount to the broad market and its large brokerage peers. We see this as an opportunity to own a high-quality, well-managed company at a bargain price.”
10. Hancock Whitney Corporation (NYSE:HWC)
Number of Hedge Fund Holders: 22
Hancock Whitney Corporation (NYSE:HWC) operates as the financial holding company for Hancock Whitney Bank that provides traditional and online banking services to commercial, small business, and retail customers. On September 30, Hancock Whitney Corp declared that it had raised its shares of Chemours by 1.5% in the first quarter. Hancock Whitney Corp now owns 18,442 shares of the speciality chemical company’s stock, which are valued at $581,000 after acquiring an additional 265 shares during the period.
On October 19, Raymond James maintained a Strong Buy rating on Hancock Whitney Corporation stock and raised its price target from $58 to $61.
At the end of the second quarter of 2022, 22 hedge funds in the database of Insider Monkey held stakes worth $166.7 million in Hancock Whitney Corporation, compared to 21 in the preceding quarter worth $156.4 million.
9. Newell Brands Inc. (NASDAQ:NWL)
Number of Hedge Fund Holders: 22
Newell Brands Inc. (NYSE:NWL) designs, manufactures, sources, and distributes consumer and commercial products worldwide. It is one of the elite strong buy stocks to invest in. On September 9, Newell Brands announced a public note offering of $500 million aggregate principal amount of 6.375% notes due 2027 and $500 million aggregate principal amount of 6.625% notes due 2029.
On October 3, Raymond James maintained a Strong buy rating on Newell Brands Inc. stock and cut the price objective from $23 to $20.
At the end of the second quarter of 2022, 22 hedge funds in the database of Insider Monkey held stakes worth $1.5 billion in Newell Brands Inc., compared to 31 in the preceding quarter worth $1.6 billion.
8. AT&T Inc. (NYSE:T)
Number of Hedge Fund Holders: 55
AT&T Inc. provides telecommunications, media, and technology services worldwide. It is one of the best strong buy stocks to invest in. On October 10, the chief technology officer of AT&T said that the firm is converging wired and wireless tech in municipalities across the country and it is also in the process of deploying its 5G standalone core.
On October 24, Raymond James upgraded AT&T Inc. stock to Strong Buy, backing the shares to surge by 40% in the coming months.
At the end of the second quarter of 2022, 55 hedge funds in the database of Insider Monkey held stakes worth $1.7 billion in AT&T Inc., compared to 74 in the preceding quarter worth $4 billion.
In its Q2 2022 investor letter, Argosy Investors, an asset management firm, highlighted a few stocks and AT&T Inc. was one of them. Here is what the fund said:
“I purchased shares of AT&T Inc. prior to its spin-off of Warner Brothers Discovery (WBD). Most people are probably familiar with AT&T. They are a major cellular service provider, and until recently owner of the Time Warner media assets, which include HBO, CNN, TNT, TBS, Cartoon Network, DC Comics and the Batman content brands, and more. At the time of my purchase, I estimated that the combined T/WBD assets traded at a 15% levered FCF yield, or 6x FCF. I also believe that WBD, which now has HBO Max, has future growth in front of it which was previously in doubt when Discovery was primarily tied to the declining cable television bundle. Since then, Netflix reported disappointing subscriber growth, which threw all streaming companies into disarray. WBD followed that news with a disappointing outlook on its business during its own quarterly earnings.
As a result, shares of WBD have declined nearly 40% since the spin-off. WBD now trades for 7x 2023E FCF and there is great potential for returns over the next few years as WBD pays down debt used to finance its merger combining Warner Brothers and Discovery and grows. We do not own a large position in WBD at present, but we may add to it over time.”
7. PACCAR Inc (NASDAQ:PCAR)
Number of Hedge Fund Holders: 25
PACCAR Inc (NASDAQ:PCAR) designs, manufactures and distributes light, medium, and heavy-duty commercial trucks internationally. It is one of the major strong buy stocks to invest in. On September 27, PACCAR declared that its new parts distribution center in Kentucky is now fully operational. The new distribution center is 260,000 square feet and it will offer next-day delivery with a capacity of storing more than 80,000 parts.
On October 20, Raymond James maintained a Strong Buy rating on PACCAR Inc. stock and increased the price target to $105 From $100.
At the end of the second quarter of 2022, 25 hedge funds in the database of Insider Monkey held stakes worth $326.9 million in PACCAR Inc, compared to 30 in the preceding quarter worth $253.2 million.
In its Q3 2021 investor letter, Oakmark Funds, an asset management firm, highlighted a few stocks and PACCAR Inc was one of them. Here is what the fund said:
“We added just one new position to the portfolio during the third quarter: PACCAR Inc. We believe Paccar is a well-managed, high-quality global commercial vehicle manufacturer that trades at a low multiple of normalized earnings. Paccar has consistently grown its earnings power via market share gains, improved margins and above-average growth of its highly profitable parts and services business. Despite operating in a cyclical industry, the company has been profitable for 82 consecutive years while steadily generating higher peak and trough EPS through each successive cycle. We had the opportunity to purchase Paccar at what we believe is an attractive price due to transitory concerns related to Covid-19-induced supply chain pressures, elevated cyclical uncertainty and the longer-term impact of powertrain electrification on the business. We believe our long-time horizon provides a significant advantage as we can look through the short-term headwinds and focus more on what Paccar should earn on a mid-cycle basis. Furthermore, while we do expect increased commercial vehicle electrification over time, we believe the company is well positioned to integrate new propulsion systems to meet customer demands.”
6. Apellis Pharmaceuticals, Inc. (NASDAQ:APLS)
Number of Hedge Fund Holders: 34
Apellis Pharmaceuticals, Inc. (NASDAQ:APLS) is a commercial-stage biopharmaceutical company that focuses on the discovery, development, and commercialization of therapeutic compounds through the inhibition of the complement system for autoimmune and inflammatory diseases. On October 7, Apellis Pharmaceuticals announced that the company has approved the grant of equity awards to 8 new employees as an equity inducement award outside of the company’s 2017 Stock Incentive plan.
On October 18, Raymond James maintained a Strong Buy rating on Apellis Pharmaceuticals, Inc. stock with a price target of $123.
Among the hedge funds being tracked by Insider Monkey, New York-based investment firm VenBio Select Advisor is a leading shareholder in Apellis Pharmaceuticals, Inc. with 9.8 million shares worth more than $443.4 million.
Alongside UnitedHealth Group Incorporated, Fidelity National Information Services, Inc., and Prologis, Inc., Apellis Pharmaceuticals, Inc. is one of the best stocks to buy now according to elite investors.
5. CBRE Group, Inc. (NYSE:CBRE)
Number of Hedge Fund Holders: 42
CBRE Group, Inc. (NYSE;CBRE) operates as a commercial real estate services and investment company worldwide. It is one of the best strong buy stocks to invest in. On September 6, CBRE Group announced that it has started a $125 million plus Series E funding round in VTS, a company specialized in commercial real estate technology and solutions. CBRE Group provided $100 million of capital and will join the VTS board of directors.
On October 20, Raymond James maintained a Strong Buy rating on CBRE Group, Inc. (NYSE:CBRE) stock and lowered the price target to $105 from $113.
Among the hedge funds being tracked by Insider Monkey, Foster City, California-based investment firm Bailard Inc. is a leading shareholder in CBRE Group, Inc. (NYSE;CBRE) with 5,807 shares worth more than $329,000.
In its Q2 2022 investor letter, Third Avenue Management, an asset management firm, highlighted a few stocks and CBRE Group, Inc. (NYSE;CBRE) was one of them. Here is what the fund said:
“Always ones to favor a company’s prospects for long-term wealth creation over its near-term earnings outlook, Fund Management opted to add to the Fund’s position in the common stock of CBRE Group, Inc. during the quarter. Held in the Fund since 2020, CBRE is the largest commercial real estate services firm globally with a market-leading position in leasing, property sales, facilities management, and valuation. CBRE is also a major player in investment management (with nearly $150 billion of assets under management) and loan servicing (approximately $340 billion of commercial and multi-family loans under administration). In combination, these segments essentially act as a tax on commercial real estate activity and accounted for more than $27 billion in revenues in the 2021 fiscal year.
Fund Management recognizes that the company’s transaction-oriented business lines (e.g., leasing and sales) are likely to retract from more recent levels. Notwithstanding, CBRE’s business model has evolved significantly in recent years with additions in facilities management, investment management, and servicing leading to substantial “recurring” revenue streams. Further, the company has amongst the most “variable” cost structures in the industry, and it is also incredibly well-capitalized with a “net-cash” position. As a result, CBRE seems likely to not only remain profitable when viewed on a group-wide basis but also set to take market share through “lift-outs” from competitors and “bolt-on” acquisitions in ancillary activities (read more)
4. The Estée Lauder Companies Inc. (NYSE:EL)
Number of Hedge Fund Holders: 46
The Estée Lauder Companies Inc. (NYSE:EL) manufactures, markets, and sells skin care, makeup, fragrance, and hair care products worldwide. It is one of the top strong buy stocks to invest in. On August 1, The Estee Lauder Companies announced that it was in talks to buy Tom Ford, a luxury fashion house, and the deal could be worth $3 billion. This would be the largest acquisition deal for Estee Lauder.
On October 20, Analyst Raymond James maintained a Strong Buy rating on Estée Lauder Companies stock and lowered the price target from $320 to $280.
Among the hedge funds being tracked by Insider Monkey, Washington-based firm Bailard Inc. is a leading shareholder in The Estée Lauder Companies Inc. with 14,458 shares worth more than $3.1 million.
In its Q3 2021 investor letter, Harding Loevner, an asset management firm, highlighted a few stocks and The Estée Lauder Companies Inc. was one of them. Here is what the fund said:
“We sold cosmetic producer The Estée Lauder Companies Inc., which we bought last March. At the time, the market reflected a dire outlook for retail demand, especially tourist-related; however, we found its Chinese business attractive and admired its agility across social media and other digital channels. As the stock has appreciated, the resulting valuation now leaves no room for error, such as a potential shift of Chinese consumers’ tastes away from US brands.”
3. Prologis, Inc. (NYSE:PLD)
Number of Hedge Fund Holders: 49
Prologis, Inc. is the global leader in logistics real estate with a focus on high-barrier, high-growth markets. It is one of the premier strong buy stocks to invest in. On October 11, Prologis announced that it has won unanimous approval from Alexandria Real Estate Equities to build the research campus at 100 East Grand Avenue, San Francisco. The research center is 559,000 square feet.
On October 17, Raymond James maintained a Strong Buy rating on Prologis, Inc. stock with a price target of $130.
Among the hedge funds being tracked by Insider Monkey, New York-based investment firm Bailard Inc. is a leading shareholder in Prologis, Inc. with 82,489 shares worth more than $8.4 million.
In its Q2 2022 investor letter, Carillon Tower Advisers, an asset management firm, highlighted a few stocks and Prologis, Inc. was one of them. Here is what the fund said:
“Prologis, Inc. (NYSE:PLD) underperformed due to supply and demand concerns following the announcement that a major online retailer is slowing the rollout of new warehouses. However, we continue to believe that there is an overwhelming demand for the company’s assets.”
2. Fidelity National Information Services, Inc. (NYSE:FIS)
Number of Hedge Fund Holders: 67
Fidelity National Information Services, Inc. provides technology solutions for merchants, banks, and capital markets firms worldwide. It is one of the elite strong buy stocks to invest in. On October 12, Fidelity National Information Services marked the opening of its $156 million new corporate headquarters. The CEO of the company said that they are 75% of the way to adding new jobs, promising to add a total of 500 jobs.
On October 18, Raymond James maintained a Buy rating on Fidelity National Information Services, Inc. stock and set a price target of $112.
Among the hedge funds being tracked by Insider Monkey, New York-based investment firm Select Equity Group is a leading shareholder in Fidelity National Information Services, Inc. with 9.5 million shares worth more than $874 million.
In its Q2 2022 investor letter, Aristotle Capital Management, an asset management firm, highlighted a few stocks and Fidelity National Information Services, Inc. was one of them. Here is what the fund said:
“We sold our position in Fidelity National Information Services, Inc., thereby, reducing our exposure to the payments processing space within the Fund. While the first half of 2022 for Fidelity National Information Services should show improving trends in the merchant space due to better Small-to-Medium Business (SMB) and travel industry metrics, we are focusing our concerns on the impact of rising inflation on the second half of 2022 trends. The concern we see is that inflation will begin to impact the purchasing power of consumers and merchant processors, like Fidelity, and will see a slowdown in the growth rate of transaction volumes.”
1. UnitedHealth Group Incorporated (NYSE:UNH)
Number of Hedge Fund Holders: 91
United Group Incorporated operates as a diversified healthcare company in the United States. It is one of the major strong buy stocks to invest in. On October 19, UnitedHealth Group noted that it has awarded $188,000 to three New Mexico-based organizations in community grants to address behavioral and maternal health in communities.
On September 22, Raymond James maintained a Strong Buy rating on UnitedHealth Group stock and raised the price target from $620 to $635.
At the end of the second quarter of 2022, 91 hedge funds in the database of Insider Monkey held stakes worth $10.9 billion in United Group Incorporated, compared to 103 in the preceding quarter worth $12.8 billion.
In its Q2 2022 investor letter, Carillon Tower Advisers, an asset management firm, highlighted a few stocks and United Group Incorporated was one of them. Here is what the fund said:
“UnitedHealth Group Incorporated reported solid quarterly results and raised 2022 guidance modestly. Additionally, managed care is another industry that is viewed as defensive in the current environment, which helped support UnitedHealth and its peer group.”
You can also take a peek at 10 Best Bargain Stocks To Buy Right Now and 10 Best Infrastructure Stocks To Buy Now.
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This article is originally published at Insider Monkey.
