In this article, we will list the 5 Most Profitable Blue Chip Stocks to Buy According to Hedge Funds. Please visit 10 Most Profitable Blue Chip Stocks to Buy According to Hedge Funds if you’d like to see an extended list and the methodology behind it.
5. Taiwan Semiconductor Manufacturing Company Limited (NYSE:TSM)
Number of Hedge Fund Holders: 234
With a profit margin of 47.34% and net income of $55.13 billion (FY25), Taiwan Semiconductor Manufacturing Company Limited (NYSE:TSM) ranks among the most profitable blue chip stocks to buy according to hedge funds. Meanwhile, analysts see 9.80% upside for the stock.
Those figures are backed by continued operational and financial strength.
In mid-April, Taiwan Semiconductor Manufacturing Company Limited (NYSE:TSM) reported first-quarter profit of $18.2 billion, up 58% year-over-year, and its eighth straight quarter of double-digit growth. CEO C.C. Wei raised the full-year revenue growth forecast to more than 30% in U.S. dollar terms, up from a prior outlook of close to 30%, and said capital expenditure would come in at the high end of its $52 billion to $56 billion guidance range.
For the second quarter, Taiwan Semiconductor Manufacturing Company Limited (NYSE:TSM) guided revenue between $39 billion and $40.2 billion. Wei described AI-related demand as extremely robust and said TSMC’s conviction in the multi-year AI megatrend remains high.
The most recent data point arrived on June 10, 2026, when Taiwan Semiconductor Manufacturing Company Limited (NYSE:TSM) reported consolidated net revenue of NT$416.98 billion for May 2026, up 1.5% from April and 30.1% year-over-year. Revenue for the first five months of the year reached NT$1.96 trillion, a 30.0% increase over the same period in 2025.
That backdrop aligns with a broader industry outlook, as on the same day, UBS analyst Nicolas Gaudois projected that global semiconductor revenues will reach $2.38 trillion by 2027, driven by agentic AI lifting demand across the memory, logic, and CPU segments. Taiwan Semiconductor Manufacturing Company Limited (NYSE:TSM) was named among the firm’s preferred stocks, with foundry utilization rates and memory industry operating profits among the cycle indicators UBS described as pointing upward into late 2027.
Taiwan Semiconductor Manufacturing Company Limited (NYSE:TSM) is a Taiwanese multinational semiconductor contract manufacturing and design company that manufactures, packages, and tests integrated circuits for various industries.
4. Meta Platforms, Inc. (NASDAQ:META)
Number of Hedge Fund Holders: 262
Meta Platforms, Inc. (NASDAQ:META) carries a profit margin of 39.36% and net income of $60.46 billion (FY25), securing its place on our list of the most profitable blue chip stocks to buy according to hedge funds, with analysts seeing 41.10% upside for the stock.
That profitability is supported by a business that continues to grow at a rapid pace. In late April, Meta Platforms, Inc. (NASDAQ:META) reported first-quarter revenue of $56.3 billion, up 33% year-over-year and ahead of analyst estimates of $55.5 billion. The growth rate outpaced Alphabet’s and was nearly twice as fast as Microsoft’s and Amazon’s.
The results came with one notable caveat: shares fell 10% after management raised 2026 capital expenditure guidance to between $125 billion and $145 billion, up from a prior range of $115 billion to $135 billion.
Analysts, however, remain focused on the longer runway.
On June 9, 2026, Truist analyst Youssef Squali reiterated a “Buy” rating on Meta Platforms, Inc. (NASDAQ:META) with a price target of $840, framing the company as building its next high-margin revenue segment one subscription at a time. Squali said he remains constructive on Meta as it continues to outpace the digital ad market and diversify into new revenue streams. He pointed to Meta’s recent launch of Plus tiers across Facebook, Instagram, and WhatsApp, as well as paid Meta AI offerings, which provide users with additional personalization and engagement features.
Squali projects Meta Platforms, Inc. (NASDAQ:META)’s Plus features will attract more than 360 million paid subscriptions and generate over $20 billion in high-margin revenue by 2030, equal to roughly 5% of Meta’s revenue. Instagram Plus alone could contribute $10 billion annually by that year, with Meta AI adding around $6.5 billion.
Meta Platforms, Inc. (NASDAQ:META) develops products that allow people to share and connect with their family and friends using PCs, mobile devices, virtual reality (VR) headsets, and AI glasses. Some of its well-known apps include Facebook, Instagram, and WhatsApp. It operates in the Reality Labs (RL) and Family of Apps (FoA) segments.
3. Alphabet Inc. (NASDAQ:GOOGL)
Number of Hedge Fund Holders: 265
With a profit margin of 37.92% and net income of $132.17 billion (FY25), Alphabet Inc. (NASDAQ:GOOGL) ranks among the most profitable blue chip stocks to buy according to hedge funds. Meanwhile, analysts see 16.70% upside for the stock.
That standing is backed by results that continue to impress.
In late April, Alphabet Inc. (NASDAQ:GOOGL) reported total revenue of $109.9 billion, up 22% year-over-year. Google Cloud grew 63% to $20 billion, its best growth rate since the segment began reporting separately in 2020, with cloud operating income tripling to $6.6 billion. The unit’s backlog nearly doubled quarter-over-quarter to $460 billion, pointing to sustained demand ahead.
Most recently, Alphabet Inc. (NASDAQ:GOOGL) is drawing fresh attention on the chip front as well.
On June 8, 2026, Reuters reported that Alphabet Inc. (NASDAQ:GOOGL)’s Google has placed an order with Intel to manufacture more than three million tensor processing units in 2028, citing The Information. The potential order would bolster Intel’s contract chip manufacturing business as it works to compete with Taiwan’s TSMC, whose capacity constraints have pushed several major AI chip designers to explore alternatives. D.A. Davidson analyst Gil Luria noted that Google and Nvidia are especially motivated to support Intel given the current administration’s push for U.S.-based manufacturing.
Following that report, on June 9, 2026, TD Cowen analyst John Blackledge raised the firm’s price target on Alphabet Inc. (NASDAQ:GOOGL) to $475 from $450, keeping a “Buy” rating. The firm lifted its long-term Google Cloud estimates following a capacity and cloud AI revenue analysis, and expects Google’s data center capacity to rise more than tenfold from 2022 to 2031. TD also expects cloud margins to rise steadily.
Alphabet Inc. (NASDAQ:GOOGL) is a holding company that operates Google services, including search engines, ad platforms, Internet browsers, devices, mapping software, app stores, video streaming, and more. The company also offers cloud infrastructure and platform services, collaboration tools, and other services for enterprise customers, as well as healthcare-related services and internet services.
2. NVIDIA Corporation (NASDAQ:NVDA)
Number of Hedge Fund Holders: 275
NVIDIA Corporation (NASDAQ:NVDA) carries a profit margin of 62.97% and net income of $120.07 billion (FY26), securing its place on our list of the most profitable blue chip stocks to buy according to hedge funds, with analysts seeing 36.90% upside for the stock.
That profitability is now backing an expanding footprint beyond chips and data centers, with NVIDIA Corporation (NASDAQ:NVDA) moving deeper into physical AI and robotics.
On June 8, 2026, Reuters reported that CEO Jensen Huang said NVIDIA Corporation (NASDAQ:NVDA) is partnering with South Korea’s LG Group on humanoid robots and data centers. Speaking to reporters after a meeting with LG Group Chairman Koo Kwang-mo in Seoul, Huang said the two companies are collaborating on motor technology and mechanical systems to advance humanoid robotics.
That announcement came a day before AI cloud company Nebius launched the Physical AI Living Lab on June 9, 2026, a six-month program equipping British and European robotics startups with NVIDIA Corporation (NASDAQ:NVDA)’s physical AI development tools and Nebius’s cloud infrastructure. The first cohort is set to begin in September 2026, with participating startups gaining access to NVIDIA OSMO, Cosmos world foundation models, Isaac Sim, and Isaac Lab, all running on Nebius infrastructure built on NVIDIA RTX PRO 6000 Blackwell Server Edition GPUs.
Both developments follow a record first quarter.
On May 20, 2026, NVIDIA Corporation (NASDAQ:NVDA) reported fiscal first quarter 2027 revenue of $81.6 billion, up 85% year-over-year, with Data Center revenue of $75.2 billion rising 92% annually. Non-GAAP diluted EPS came in at $1.87, up 140% year-over-year. For the second quarter, the company guided revenue of $91.0 billion, plus or minus 2%.
NVIDIA Corporation (NASDAQ:NVDA) is a fabless semiconductor and AI computing company that designs GPUs, AI accelerators, Application Programming Interfaces (APIs), and system-on-a-chip units. Through its CUDA ecosystem, the company enables industries ranging from autonomous vehicles to scientific research by advancing AI, accelerated computing, and data center infrastructure.
1. Microsoft Corporation (NASDAQ:MSFT)
Number of Hedge Fund Holders: 282
With a profit margin of 39.34% and net income of $101.83 billion (FY25), Microsoft Corporation (NASDAQ:MSFT) ranks among the most profitable blue chip stocks to buy according to hedge funds. Meanwhile, analysts see 38.20% upside for the stock.
That standing is well-supported by results, and Microsoft Corporation (NASDAQ:MSFT) is actively broadening its revenue base beyond cloud and AI.
In April, Microsoft reported fiscal third-quarter revenue of $82.9 billion, with Azure growing 40% year over year. Reported EPS came in at $4.27, topping the $4.06 consensus. The company’s AI business crossed a $37 billion annualized revenue run rate, up 123% year-over-year, and management noted that nearly 90% of Fortune 500 companies now run active AI agents built with Copilot Studio.
Meanwhile, on June 10, 2026, Reuters reported that the Microsoft-owned platform launched BrandWorks, a newly assembled team of marketing experts aimed at delivering higher-performing ad campaigns for business advertisers. LinkedIn expects BrandWorks to generate an annualized run rate of $100 million next fiscal year, according to a source familiar with the matter.
The team, led by VP Alex Josephson, has grown roughly 60% in recent months through hires from TikTok, Meta, and X. Its Top Voices 360 program, which connects advertisers with creators for sponsored content, drove more than $20 million in revenue from May 2025 to May 2026, with clients including SAP, IBM, and ServiceNow. Microsoft Corporation (NASDAQ:MSFT)’s LinkedIn also said it expects revenue from BrandLink, its video ad program, to nearly triple in the current fiscal year.
Microsoft Corporation (NASDAQ:MSFT) is a global technology company that develops and sells a wide range of software, cloud services, devices, and business solutions, serving both individual users and enterprise customers worldwide. Its flagship products include Windows, Microsoft 365, Azure, LinkedIn, and Xbox.
While we acknowledge the potential of MSFT 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 MSFT and that has 100x upside potential, check out our report about the cheapest AI stock.
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