5 Best Momentum Stocks to Buy Now

2. Microsoft Corp (NYSE:MSFT)

No of HFs: 234

Total Value of HF Holdings: $42.1 Billion

One of the biggest hedge fund savings stakes in the company is Ken Fisher’s Fisher Asset Management which had $4.7 billion invested in the stock at the end of September. Polen Capital Management mentioned MSFT in its Q4 2020 investor letter:

“Microsoft continues to grow revenue and earnings at scale as it becomes increasingly dominant. Operating leverage continues to benefit shareholders, with the most recent operating margins reaching nearly 43%, up from approximately 38% a year ago. In 2019, we increased the Portfolio’s position to 6% and were rewarded as Microsoft was our top contributor for that year. For the full year 2020, it was, once again, our top contributor. Microsoft now represents the largest position in the Portfolio. Early in the pandemic, CEO Satya Nadella said, “We’ve just seen two years’ worth of digital transformation in two months,” and many of the company’s business segments continue to benefit. Notably, Microsoft 365 (Teams, Azure, Windows virtual desktop and security), Windows, Surface, and gaming are all experiencing increased demand. Free cash flow grew nearly 40% in the most recent quarter, giving the company continued ability to reinvest into long and attractive growth runways.”