15 Dow Stocks Listed and Ranked By 2022 Hedge Fund Bullishness Index

In this article, we discuss 15 Dow stocks and their rank according to the 2022 hedge fund bullishness index. If you want to read our review of these stocks and the latest market situation, go directly to Dow 30 Stocks Listed and Ranked By 2022 Hedge Fund Bullishness Index. 

15. American Express Company (NYSE:AXP)

Number of Hedge Fund Holders: 69

American Express Company (NYSE:AXP) is one of the largest financial services companies in the world, with a $108.6 billion market cap. It offers payment card and travel-related services around the globe. On June 6, American Express Company (NYSE:AXP) was upgraded to ‘Buy’ from ‘Hold by Edward Jones analyst Kyle Sanders, who noted that AXP’s recent initiatives to attract young customers have led to significant account growth for the firm.

69 hedge funds were stakeholders of American Express Company (NYSE:AXP) at the end of the first quarter of 2022, which included big names such as Fisher Asset Management, Arrowstreet Capital, and Berkshire Hathaway, the latter of which stood as the firm’s largest shareholder with a massive $28.4 billion position. In comparison, 64 hedge funds were bullish on American Express Company (NYSE:AXP) shares at the end of the fourth quarter, signifying growing investor confidence in the company.

Here is what ClearBridge Investments had to say about the performance and future prospects of American Express Company (NYSE:AXP) in its Q2 2021 investor letter:

“In financials, American Express has done an excellent job demonstrating the resiliency of its franchise in the midst of a global pandemic that drove a 60% decline in its core travel and entertainment business. The company’s spend-centric model has been helped by fiscal stimulus ensuring a flush consumer, while management continues to execute well by adding millions of new consumer and small and medium business accounts, which should benefit the franchise over the medium to long term. We remain optimistic regarding the company’s prospects as travel and entertainment activity rebounds, adding to our position in the quarter.”

14. Verizon Communications Inc. (NYSE:VZ)

Number of Hedge Fund Holders: 69

Verizon Communications Inc. (NYSE:VZ) is a communications services company based in New York. It was recently named in Wells Fargo’s recession stock portfolio. Verizon boasts 18 years of consistent dividend increases, with its payments equating to a 5.04% yield as of July 1.

Hedge fund sentiment around Verizon Communications Inc. (NYSE:VZ) was improving in the first quarter of 2022. 69 hedge funds owned positions in the company at the end of March, with a collective price tag of $4.12 billion. That was in comparison to 63 hedge funds in the previous quarter with $10.9 billion worth of positions. Fisher Asset Management and Renaissance Technologies were prominent stakeholders of Verizon Communications Inc. (NYSE:VZ) in the first quarter, with stakes worth $855 million and $540 million respectively.

ClearBridge Investments discussed the prospects of Verizon Communications Inc. (NYSE:VZ) in its Q4 2021 investor letter. Here’s what it said:

“Over the last year, we have repositioned our portfolio to navigate the course we see ahead. We added to more defensive areas of the portfolio like telecom (Verizon). While the next month or two will likely prove choppy on account of the Omicron variant, we believe that Omicron, like Delta, represents a speed bump on the way to recovery rather than a true change in course. We see strong economic momentum continuing in 2022 and we expect interest rates to rise. After a decade of remarkably low rates, we would not be surprised if this change in direction is accompanied by some fits and starts in the markets. With our emphasis on pricing power, purposeful sector exposure, valuation discipline, and a strong dividend profile, we believe we are well-positioned for the year ahead.”

13. Goldman Sachs Group, Inc. (NYSE:GS)

Number of Hedge Fund Holders: 71

Goldman Sachs Group, Inc. (NYSE:GS) is a bank holding company which ranks among the ‘Big Four’ investment banks in the United States. 

71 hedge funds reported ownership stakes in Goldman Sachs Group, Inc. (NYSE:GS) as of the end of March with a combined value of $4.59 billion. That was down from 75 hedge funds in the previous quarter with $5.38 billion worth of positions in the company. Eagle Capital Management, with a $1.12 billion stake, was the largest shareholder of Goldman Sachs Group, Inc. (NYSE:GS) in the first quarter. 

Ariel Investments, an investment management firm, talked about many stocks in its Q4 2021 investor letter, and Goldman Sachs Group, Inc. (NYSE:GS) was one of them. Here is what the fund said:

“Rising interest rates, after a surprisingly long period of low absolute rates and negative “real” rates, will create a headwind. While there has been much debate about the cause of these low rates, we believe the most important factor has been the $120 billion in monthly federal reserve open market bond purchases and the accumulation of an $8 trillion balance sheet. The former will end, and the latter will shrink. It is not just the Fed that has aggressively purchased bonds, bidding up prices and lowering yields. Bond traders and hedge fund managers have added to positions, confident that being on the same side as the Fed was the wise place to be. Now as the Fed is about to become a seller of bonds rather than a buyer, Wall Street’s “smart money” is likely to follow suit. Against this backdrop, fixed income securities and bond substitutes such as high dividend paying utilities and absolute return hedge funds are substantially overpriced and are not likely to produce attractive returns going forward.

This expectation of a reversion to the mean for interest rates helped 2021 performance, though not as much as we had hoped. The yield on the U.S. 10-year Treasury did indeed increase from +0.92% at the beginning of the year to +1.52% at year-end. An underreported story was the poor performance of bonds last year. The Barclays Aggregate Index declined -1.67% for the year ending December compared to a return of +28.71% for equities as measured by the S&P 500. Interest rates have continued to climb in 2022 with the 10-year Treasury at +1.79% as we go to print. This move higher in rates has contributed to our good, early start to 2022. The Goldman Sachs Group, Inc. (GS) jumped +47.59% for the year and +1.73% in the quarter.”

The Procter & Gamble Company (NYSE:PG) is a consumer goods giant based in Cincinnati, Ohio. It has a 65-year streak of consistently growing its dividend, with its shares offering a 2.54% yield as of July 1.

Of the 912 hedge funds being tracked by Insider Monkey at the end of March, 72 reported having long bets on The Procter & Gamble Company (NYSE:PG) with a collective value of $6.06 billion. This shows improving investor confidence in PG over the previous quarter, when 67 hedge funds were bullish on the company’s shares.

With a $1.51 billion stake, GQG Partners was the top shareholder of The Procter & Gamble Company (NYSE:PG) in the first quarter. Other prominent shareholders included Ray Dalio’s Bridgewater Associates, which held a $1.04 billion stake, and Yacktman Asset Management with a roughly $471 million position.

The Home Depot, Inc. (NYSE:HD) is a home improvement retailer which offers home building, decoration and outdoor products.

75 hedge funds were long The Home Depot, Inc. (NYSE:HD) at the end of the first quarter, with combined stakes worth $5.59 billion. In comparison, 68 hedge funds held $6.08 billion worth of Home Depot shares a quarter prior. HD’s largest shareholder in the first quarter was Fisher Asset Management with a massive stake worth $2.43 billion. Jim Simons’ Renaissance Technologies also turned bullish on The Home Depot, Inc. (NYSE:HD) in the first quarter, initiating a nearly $564 million position.

10. Intel Corporation (NASDAQ:INTC)

Number of Hedge Fund Holders: 76

Intel Corporation (NASDAQ:INTC) deals in semiconductor chips, processors and other computer hardware. The company has plans to invest billions to boost its semiconductor manufacturing capabilities and recoup lost market share from rival Advanced Micro Devices, Inc. (NASDAQ:AMD).

Hedge fund sentiment around Intel Corporation (NASDAQ:INTC) was positive in the first quarter of 2022. 76 hedge funds were long the company compared to 72 funds in the previous quarter. With 16.59 million shares worth $822 million, Baupost Group was the biggest Q1 shareholder of Intel Corporation (NASDAQ:INTC).

 Here is what O’Keefe Stevens Advisory had to say about Intel Corporation (NASDAQ:INTC) in its Q1 2022 investor letter:

“Intel announced they are removing stock-based compensation from non-GAAP earnings in 2022 to report results aligning with semiconductor peers. This may seem like a reasonable thing to do as comparability between peers becomes easier. On the other hand, what exactly is the point of adjusted earnings? It is not to conform to some industry norm or because the management teams need to make performance metrics. The point of adjusting earnings is to present results in a light that more closely reflects the actual underlying performance of the business. That is, backing out expenses that might be one-time in nature, such as legal or fire expenses. First off, share-based compensation is an actual expense. Decreasing my ownership stake in a company without receiving any compensation is not free. If a company paid its employees in all stock, would they add back the entire SBC? What a margin profile that would be. Second, should a company be worried about reporting results similar to other companies? Every company is unique. Management should not waste time determining what expenses should be excluded. Run the business, don’t worry about adjusting the numbers.”

9. Johnson & Johnson (NYSE:JNJ)

Number of Hedge Fund Holders: 83

Johnson & Johnson (NYSE:JNJ) deals in the provision of consumer products, medical devices and biopharmaceutical products. It is known as one of the safest dividend stocks to buy, having 59 consecutive years of dividend increases under its belt. As of June 30, its dividend payments yield 2.55% annually.

83 hedge funds were bullish on Johnson & Johnson (NYSE:JNJ) at the close of the first quarter, with overall stakes worth $7.4 billion. The same number of hedge funds were long the company’s shares a quarter earlier as well. JNJ’s biggest Q1 shareholder was Arrowstreet Capital, with 6.65 million shares priced at $1.17 billion, a 38% increase from the previous quarter. Bridgewater Associates also held a $770 million stake in Johnson & Johnson (NYSE:JNJ).

Distillate Capital, an investment firm, talked about Johnson & Johnson (NYSE:JNJ) in its Q2 2021 investor letter. Here is what the fund said:

“The largest additions in the rebalance, Johnson & Johnson was around 50 and 40 basis points incrementally. J&J underperformed in the quarter while its normalized free cash flows held steady and so its position size was topped off to match the stable cash flows.”

8. Merck & Co., Inc. (NYSE:MRK)

Number of Hedge Fund Holders: 84

Merck & Co., Inc. (NYSE:MRK) is one of the world’s leading biopharmaceutical firms, developing drug therapies and vaccines for a range of disorders.

Investors are rotating towards large-cap biopharmaceutical stocks as a defensive play in the current macro setup. 84 hedge funds reported ownership of stakes in Merck & Co., Inc. (NYSE:MRK) as of the close of Q1 2022, compared to 80 hedge funds in the preceding quarter. Fisher Asset Management, with a $970.8 million position, was the leading shareholder of Merck in the first quarter.

Miller Howard Investments talked about many stocks in its Q3 2021 investor letter, and Merck & Co., Inc. (NYSE:MRK) was one of them. The firm said:

“While optimistic about a recovery, we continue to balance our cyclical holdings with dividend-payers in stable, less economically-sensitive industries. We hold three pharmaceutical companies, (which includes) Merck (MRK). All three have strong cash flows and balance sheets, making their high dividends reasonably safe. The investment controversy surrounding these pharma companies is whether they can develop or acquire new products to replace their current blockbuster drugs. The low valuations on these stocks reflects what we believe to be undue pessimism by investors on the prospects for new drugs.”

7. UnitedHealth Group Inc. (NYSE:UNH)

Number of Hedge Fund Holders: 103

UnitedHealth Group Inc. (NYSE:UNH) is a diversified healthcare company based in Minnesota, which deals in healthcare insurance, health management services, and pharmacy care services.

An examination of Insider Monkey’s database revealed that 103 hedge funds were long UnitedHealth Group Inc. (NYSE:UNH) at the end of the first quarter, compared to 96 funds a quarter earlier. This made UNH the most popular healthcare stock among the 912 hedge funds which Insider Monkey tracks. UnitedHealth Group Inc.’s (NYSE:UNH) largest shareholder in the first quarter was Eagle Capital Management with a $1.48 billion stake.

6. JPMorgan Chase & Co. (NYSE:JPM)

Number of Hedge Fund Holders: 110

JPMorgan Chase & Co. (NYSE:JPM) ranks as the largest bank in the United States with a $330 billion market cap. It was founded in 1799 and pays out a dividend that yields 3.55% as of July 1.

Smart money investors were seen loading up on JPMorgan Chase & Co. (NYSE:JPM) stock in Q1. At the end of the first quarter, a total of 110 hedge funds owned positions in JPM with a combined value of $5.05 billion. In contrast, 107 hedge funds owned $6.58 billion worth of positions in the banking firm a quarter earlier. Ken Fisher’s Fisher Asset Management was the largest shareholder of JPMorgan Chase & Co. (NYSE:JPM) in the first quarter, with 7.76 million shares worth $1.05 billion.

Investment firm ClearBridge Investments mentioned JPMorgan Chase & Co. (NYSE:JPM) in its Q4 2021 investor letter. Here’s what it said:

“Our energy and financials holdings kept pace in the 2021 rally.  In financials, JPMorgan benefited from strong economic growth, a rise in Treasury yields, and a benign credit environment.”

5. The Walt Disney Company (NYSE:DIS)

Number of Hedge Fund Holders: 113

The Walt Disney Company (NYSE:DIS) is an entertainment giant with sizeable interests in media and theme parks around the globe. Morgan Stanley analyst Benjamin Swinburne noted on June 30 that Disney shares present an attractive risk/reward at current levels, and reiterated an ‘Overweight’ rating on them. He assessed that the the company’s future growth will be driven by the strong performance of its Parks segment and a streaming business that is continually taking market share and scaling to profitability.

113 hedge funds reported having bullish bets on The Walt Disney Company (NYSE:DIS) shares as of the end of March, compared to 111 hedge funds at the end of December. The total value of hedge funds’ Q1 holdings was recorded at $5.16 billion. Matrix Capital Management increased its stake in Disney by 51% in the first quarter to become the company’s largest shareholder, with 6.33 million shares worth $868.2 million.

Asset management firm Harding Loevner mentioned many stocks in its Q1 2022 investor letter, and The Walt Disney Company (NYSE:DIS) happened to be one of them. It said:

“The war in Ukraine has given new urgency to the question of whether globalization has reached a tipping point and if the familiar web of decentralized, just-in-time, global supply chains will be a casualty of the inward turn dividing countries into competing trading blocs. It is probably too soon to know. We sold Disney (NYSE:DIS), due to some concerns about the increasing capital intensity of its business amid signs of rising competition and slowing growth in streaming media consumption.”

4. Salesforce, Inc. (NYSE:CRM)

Number of Hedge Fund Holders: 114

Salesforce, Inc. (NYSE:CRM) is an industry-leader in customer relationship management (CRM) technology and offers various cloud-based software applications. Stifel analyst J. Parker Lane gave CRM a ‘Buy’ rating on June 1, noting that the firm’s geographic diversification and product line-up gives it some insulation against a weakening macro backdrop.

Top money managers were seen piling into Salesforce, Inc. (NYSE:CRM) stock in the first quarter. At the close of the first quarter, 114 hedge funds were bullish on CRM shares with collective stakes worth $9.89 billion. This is in comparison to 110 hedge funds a quarter earlier. With a massive $3.23 billion stake that was recently increased by 5%, Fisher Asset Management was the leading shareholder of Salesforce, Inc. (NYSE:CRM) in the first quarter of 2022.

Asset management firm Vulcan Value Partners talked about Salesforce, Inc. (NYSE:CRM) in its Q1 2022 investor letter. Here is what it said:

“Salesforce.com Inc. is the dominant provider of customer relationship management software and technology. Salesforce has high retention rates, pricing power, high free cash flow, and a competitive moat. The company continues to execute well. Margins decreased slightly during the fourth quarter but continue to be on path for material expansion over the long term. Salesforce is seeing increased spending as employees are returning to the office, and we believe the global pandemic has only improved its prospects.”

3. Apple Inc. (NASDAQ:AAPL)

Number of Hedge Fund Holders: 131 

Apple Inc. (NASDAQ:AAPL) was a popular stock among investors in the first quarter of 2022, as 131 hedge funds owned $182 billion worth of shares in the company. This was in comparison to 134 hedge funds in the previous quarter with aggregate positions worth $186 billion. Warren Buffett’s Berkshire Hathaway held a gigantic $155 billion stake in Apple Inc. (NASDAQ:AAPL) consisting of 890 million shares, making it the firm’s largest Q1 shareholder.

Here is what Weitz Investment Management had to say about Apple Inc. (NASDAQ:AAPL) in its Q1 2022 investor letter:

“Changes to Apple’s (NASDAQ:AAPL) mobile operating system have temporarily impacted growth of Meta’s advertising business just as the company’s investments in Instagram’s “Reels” feature ramp ahead of full monetization. (Shareholders can read research analyst Jon Baker’s in-depth discussion of current events impacting Meta and reasons why we’re optimistic about the company in our recent Analyst Corner feature.) CoreCard (formerly Intelligent Systems) struggled early in the fiscal year to hire and train staff to handle growth from new and existing clients. Lately, Apple-related headlines also took a bite out of CoreCard shares, as reports suggest Apple is exploring a transition of its credit card and other financial services to internally built solutions. Such a move would create revenue headwinds for its partners, which CoreCard is widely believed to be. We are monitoring these developments and stress-testing our model accordingly.”

2. Visa Inc. (NYSE:V)

Number of Hedge Fund Holders: 159

Visa Inc. (NYSE:V) is a global leader in digital payments technology. Baird analyst David Koning thinks the stock will remain resilient in a recession-scenario given growing purchase volume, and retained his bullish stance as cross-border transactions and inflation provide ongoing growth drivers. He gave Visa Inc. (NYSE:V) an ‘Outperform’ rating and named it as a “bullish Fresh Pick,” with a $290 price target.

Investor sentiment around Visa Inc. (NYSE:V) stock significantly improved in the first quarter of 2022, as 159 hedge funds were bullish on the company in contrast to 142 funds in the previous quarter. TCI Fund Management, with a massive $4.41 billion stake, was the top investor in Visa Inc. (NYSE:V) during the first quarter. Fisher Asset Management and Warren Buffett’s Berkshire Hathaway also owned multi-billion dollar stakes in the digital payments company.

Here is what investment firm Polen Capital had to say about the prospects and market position of Visa Inc. (NYSE:V) in its Q1 2022 investor letter:

“We added to both Visa and Mastercard during the final quarters of 2021, based on the belief that both businesses were trading at attractive prices and poised to deliver, double-digit returns over the next three to five years. Cross-border transactions–a highly profitable business segment for both companies–represent roughly 10% of Visa and Mastercard’s volumes and 25% of their gross revenues, so lockdowns have severely impacted this segment due to stifled travel. While it was impossible to know when people would begin traveling again, we accepted this reality with the belief that travel would eventually return. Both companies have commented that as soon as a country or geography reopens, cross-border volumes reignite, amplifying each business’s growth and profitability. We think these near- term headwinds have created an attractive long-term investment opportunity.”

1. Microsoft Corporation (NASDAQ:MSFT)

Number of Hedge Fund Holders: 259

Technology conglomerate Microsoft Corporation (NASDAQ:MSFT) was the second favorite stock to hold among hedge funds according to data compiled by studying the portfolios of 900+ elite hedge funds. At the close of March, 259 hedge funds owned $65.6 billion worth of positions in the company, compared to 262 funds with $75.7 billion worth of stakes a quarter earlier. TCI Fund Management, Arrowstreet Capital and Fisher Asset Management all held multi-billion dollar stakes in Microsoft Corporation (NASDAQ:MSFT) during the first quarter of 2022.

Here is what investment firm Baron Funds had to say about Microsoft Corporation (NASDAQ:MSFT) in its Q1 2022 investor letter:

“Shares of mega-cap software company Microsoft Corporation (NASDAQ:MSFT) pulled back with the broader software sector. The company posted another solid quarter, highlighted by total revenues increasing 20% and Microsoft Cloud revenues, now 45% of total revenues, growing 32%. These results were driven, in large part, by strong demand for large Azure contracts. We believe Microsoft can compound revenue in the low double digits for the next three years, underpinned by its expansion in its total addressable market and market share gains.”

 

You can also take a look at 10 Best Education Stocks To Buy Now and 15 Best E-Commerce Stocks To Buy Now.

Follow Insider Monkey on Twitter