5 High Profit Margin Stocks to Buy According to Hedge Funds

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1. NVIDIA Corporation (NASDAQ:NVDA)

NVIDIA Corporation (NASDAQ:NVDA) ranks among the best high profit margin stocks to buy. On March 5, Tigress Financial Partners boosted its price target for NVIDIA Corporation (NASDAQ:NVDA) to $360 from an unspecified previous target, while retaining a Strong Buy rating on the company’s shares. The firm stated that its fourth-quarter 2026 results increased its AI dominance, driven by a solid Blackwell rollout.

The firm identified $3 trillion to $4 trillion in spending on AI systems by 2030 as a potential area for NVIDIA’s expansion. Tigress further stated that the company’s capital allocation approach prioritizes funding expansion efforts while returning surplus cash to shareholders.

Meanwhile, CLSA maintained its High-Conviction Outperform rating and $300 price target for NVIDIA Corporation (NASDAQ:NVDA). The firm highlighted that NVIDIA’s earnings for FY27-28 had increased by 27%-35% in the past six months. It also stated that NVIDIA Corporation (NASDAQ:NVDA) booked $30 billion in sovereign AI income in FY26.

NVIDIA Corporation (NASDAQ:NVDA) is a fabless semiconductor company. It designs and develops graphics processing units and related technologies used in gaming, data centers, artificial intelligence, and autonomous systems.

While we acknowledge the potential of NVDA to grow, our conviction lies in the belief that some AI stocks hold greater promise for delivering higher returns and have limited downside risk. If you are looking for an AI stock that is more promising than NVDA and that has 100x upside potential, check out our report about the cheapest AI stock.

READ NEXT: 30 Stocks That Should Double in 3 Years and 11 Hidden AI Stocks to Buy Right Now.

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