5 High Profit Margin Stocks to Buy According to Hedge Funds

2. Meta Platforms, Inc. (NASDAQ:META)

Meta Platforms, Inc. (NASDAQ:META) ranks among the best high profit margin stocks to buy. On March 5, Erste Group raised Meta Platforms, Inc. (NASDAQ:META) to Buy from Hold, highlighting the company’s AI investments and pricing. Analyst Hans Engel stated that Meta expects a major increase in spending to meet its AI objectives in 2026.

Based on the anticipated 12-month price-to-earnings ratio, Meta Platforms, Inc. (NASDAQ:META) is currently trading at the lower end of its valuation history over the past 10 years. According to Engel, the price of the stock will rise as a result of this historically cheap valuation, continued strong user and profit growth, as well as the effective integration of AI.

In a separate development, Meta Platforms, Inc. (NASDAQ:META) has signed a major multiyear artificial intelligence content licensing agreement with News Corp, potentially valued at up to $50 million per year. This deal allows Meta to access News Corp’s content from the United States and the UK, boosting its AI capabilities.

Meta Platforms, Inc. (NASDAQ:META) is a California-based company that develops social media applications. Dedicated to connecting people and growing businesses, the company has two segments: Family of Apps (FoA) and Reality Labs (RL).