5 Best Roth IRA Stocks Hedge Funds are Buying

1. Microsoft Corporation (NASDAQ: MSFT)

Number of Hedge Fund Holders: 251

Microsoft Corporation (NASDAQ: MSFT) is placed first on our list of 10 best Roth IRA stocks hedge funds are buying. The company’s shares have returned 30% to investors over the past twelve months. The firm is a technology company focusing on the software sector and operates from Washington. On July 15, investment advisory Jefferies praised the Windows 365 platform of the company, noting that it had the potential to be the next killer product from the software giant that already has many growth catalysts working in its favor.

On July 16, investment advisory Mizuho maintained a Buy rating on Microsoft Corporation (NASDAQ: MSFT) stock and raised the price target to $310 from $285, highlighting firms enabling digitization continued to perform well in the post-pandemic economy.

Out of the hedge funds being tracked by Insider Monkey, Washington-based investment firm Fisher Asset Management is a leading shareholder in Microsoft Corporation (NASDAQ: MSFT)  with 23.9 million shares worth more than $5.6 billion.

In its Q1 2021 investor letter, Polen Capital, an investment management firm, highlighted a few stocks and Microsoft Corporation (NASDAQ: MSFT) was one of them. Here is what the fund said:

“We have written extensively about Microsoft in recent commentaries. It was our leading contributor last year and one of our largest weightings within the Portfolio. It continues to experience business momentum through several dominant, essential, and competitively advantaged businesses, like Office 365 and Azure. The markets it competes for are enormous, which gives the company the ability to compound at scale. In the past quarter alone, the company generated over $40 billion in revenue, representing a 17% growth rate. The inherent operating leverage in Microsoft’s business model continues and led to 34% earnings growth this past quarter. Despite the broad rotation we saw in the first quarter and Microsoft’s robust performance in 2020, we think its business fundamentals continue to exhibit strength, and the stock continues to reflect the fundamentals.”

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