5 Hot Stocks to Buy According to Hedge Funds

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Below we present the list of 5 Hot Stocks to Buy According to Hedge Funds. For our methodology and a more comprehensive list please see 12 Hot Stocks to Buy According to Hedge Funds.

5. Salesforce, Inc. (NYSE:CRM)

Number of Hedge Fund Shareholders: 136

Year-to-Date Return (through June 5): 55.7%

There was a 16% surge in the number of funds long Salesforce, Inc. (NYSE:CRM) during Q1 to hit an all-time high and elevating the stock into the top ten of hedge funds’ most popular stocks. Dan Loeb’s Third Point and Philippe Laffont’s Coatue Management were some of the leading hedge funds to add CRM to their 13F portfolios during the quarter.

If there’s been one clear trend among the hottest stocks to buy according to hedge funds, it’s been their deepening ties to AI, and that’s certainly the case with Salesforce, Inc. (NYSE:CRM), which has quickly applied generative AI capabilities to many of its product offerings, including Slack and Tableau, in addition to the forthcoming launch of Einstein GPT. Salesforce is also becoming more profitable even as it spends more money to improve its product offerings, hitting a non-GAAP operating margin of 27.6% in the company’s Q1 of fiscal 2024 ended April 30.

Vulcan Value Partners likes how quickly Salesforce, Inc. (NYSE:CRM) has ramped up its profitability according to the fund’s Q1 2023 investor letter:

Salesforce, Inc. (NYSE:CRM) was a material contributor during the quarter. The company has taken numerous positive steps to increase profitability more quickly than expected. Salesforce also improved its corporate governance by recommending three new board members. The company is focused on improving margins, deemphasizing acquisitions, and has expanded its stock buyback plan from $10 billion to $20 billion. We believe Salesforce can pursue these opportunities while continuing to increase its competitive position.

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