In this article, we discuss the 5 most volatile stocks to buy now. If you want to read our detailed analysis of these stocks, go directly to the 15 Most Volatile Stocks To Buy Now.
5. Applied Materials, Inc. (NASDAQ: AMAT)
Number of Hedge Fund Holders: 78
Applied Materials, Inc. (NASDAQ: AMAT) is a company that makes and sells semiconductors. It is based in California and is placed fifth on our list of 15 most volatile stocks to buy now. On May 20, the firm posted earnings for the second fiscal quarter, reporting earnings per share of $1.63, beating market estimates by $0.12. The revenue over the period was close to $5.6 billion, up 40% year-on-year and beating estimates by $160 million. On June 10, the firm declared a quarterly dividend of $0.24 per share.
On May 21, investment advisory JPMorgan maintained an Overweight rating on Applied Materials, Inc. (NASDAQ: AMAT) stock and raised the price target to $160 from $146, noting the earnings beat of the firm and strong margins moving forward.
Out of the hedge funds being tracked by Insider Monkey, London-based investment firm Generation Investment Management is a leading shareholder in the firm with 4.4 million shares worth more than $590 million.
4. NVIDIA Corporation (NASDAQ: NVDA)
Number of Hedge Fund Holders: 80
NVIDIA Corporation (NASDAQ: NVDA) is a visual computing firm based in California. It is ranked fourth on our list of 15 most volatile stocks to buy now. The company has a market cap of over $480 billion and posted more than $16 billion in revenue last year. The stock has benefited from an increase in the prices of semiconductor chips amid increased demand. The products of the firm have also been in hot demand due to the increase in crypto coin mining around the globe.
On July 23, investment advisory Argus kept a Buy rating on NVIDIA Corporation (NASDAQ: NVDA) stock and raised the price target to $230 from $175, highlighting that the demand for the products made by the company still remained high despite the pandemic winding down.
At the end of the first quarter of 2021, 80 hedge funds in the database of Insider Monkey held stakes worth $6.2 billion in NVIDIA Corporation (NASDAQ: NVDA), down from 88 the preceding quarter worth $8.6 billion.
In its Q1 2021 investor letter, Vulcan Value Partners, an asset management firm, highlighted a few stocks and NVIDIA Corporation (NASDAQ: NVDA) was one of them. Here is what the fund said:
“NVIDIA Corp. is the dominant supplier of Graphics Processing Units (GPUs) worldwide. NVIDIA’s GPUs are at the intersection of a number of important computing trends including the movement to the Cloud, artificial intelligence, autonomous vehicles, edge computing, gaming, and more. We previously owned NVIDIA and sold it in the third quarter of 2020 as the price to value gap closed and our margin of safety was reduced. As with all our MVP companies, we continued to follow NVIDIA closely. Since that time, NVIDIA reported excellent results and its value has compounded rapidly. The technology selloff at the beginning of the year negatively affected the stock price while our estimate of NVIDIA’s value per share increased. This happy combination of events created a margin of safety and an opportunity to once again add NVIDIA to the portfolio.”
3. Square, Inc. (NYSE: SQ)
Number of Hedge Fund Holders: 92
Square, Inc. (NYSE: SQ) is placed third on our list of 15 most volatile stocks to buy now. The company is headquartered in California and markets digital payments solutions. In earnings results for the second quarter, posted on August 1, the firm reported earnings per share of $0.66, beating market estimates by $0.35. The revenue over the period was $4.6 billion, up 143% compared to the revenue over the same period last year but missing market expectations by $370 million.
On August 2, investment advisory Oddo BHF upgraded Square, Inc. (NYSE: SQ) stock to Outperform from Neutral with a price target of $340. Martin Marandon-Carlhian, an analyst at the firm, issued the ratings update.
At the end of the first quarter of 2021, 92 hedge funds in the database of Insider Monkey held stakes worth $9.2 billion in Square, Inc. (NYSE: SQ) , up from 89 the preceding quarter worth $8.8 billion.
2. Micron Technology (NASDAQ: MU)
Number of Hedge Fund Holders: 100
Micron Technology (NASDAQ: MU) is ranked second on our list of 15 most volatile stocks to buy now. The firm makes and sells memory and storage products. It is based in Idaho. In earnings results for the third fiscal quarter, posted on June 30, the firm reported earnings per share of $1.88, beating market estimates by $0.17. The revenue over the period was $7.4 billion, up 36% compared to the revenue over the same period last year and beating market expectations by a handsome $160 million.
On July 19, investment advisory Morgan Stanley maintained an Underweight rating on Micron Technology (NASDAQ: MU) stock but raised the price target to $185 from $176, noting that the advisory expected a strong quarter ahead for the firm.
At the end of the first quarter of 2021, 100 hedge funds in the database of Insider Monkey held stakes worth $7.6 billion in Micron Technology (NASDAQ: MU), the same as in the preceding quarter worth $8.1 billion.
In its Q1 2021 investor letter, Bonsai Partners, an asset management firm, highlighted a few stocks and Micron Technology (NASDAQ: MU) was one of them. Here is what the fund said:
“Micron is a manufacturer of memory semiconductor chips. Micron appreciated 17.3% during the quarter.
With the semiconductor cycle in full swing, sentiment continued to improve for major DRAM and NAND suppliers. Spot pricing for DRAM continues its upward march due to supply shocks across the industry and sustained demand levels that continue to outstrip supply.
As a result, Micron showed improving results for the fiscal first quarter, raised guidance intra-quarter for the fiscal second quarter, and offered strong guidance for the fiscal third quarter in both growth and margins.
While the cyclical nature of DRAM hasn’t changed, the cycles themselves continue to become more benign, leading to long-term economic improvement across these businesses. Micron is now continuously profitable, with industry players in a dramatically stronger position than even just five years ago.
The biggest negative surprise in the quarter came from Micron’s exit from its 3D XPoint hybrid memory business. The company also announced its decision to sell its accompanying Utah fab. Fortunately, this development does not alter the investment thesis much since 3D XPoint was an option ticket for future growth. While it’s unfortunate this product didn’t pan out, now is an excellent time to sell a fab, so perhaps it is a blessing in disguise?”
1. Alibaba Group Holding Limited (NYSE: BABA)
Number of Hedge Fund Holders: 135
Alibaba Group Holding Limited (NYSE: BABA) is a Chinese company that operates as a technology firm primarily in the ecommerce business. It is placed first on our list of 15 most volatile stocks to buy now. The company is preparing to release second quarter earnings results amid concerns around regulatory pressures in China and their impact on Chinese firms listed in the United States. The company has a market cap of $530 billion and posted more than $100 billion in revenue last year.
On July 13, investment advisory Deutsche Bank kept a buy rating on Alibaba Group Holding Limited (NYSE: BABA) stock but lowered the price target to $281 from $282, noting that the earrings for the firm could be masked by increased investment spending.
Out of the hedge funds being tracked by Insider Monkey, Washington-based investment firm Fisher Asset Management is a leading shareholder in Alibaba Group Holding Limited (NYSE: BABA) with 13.9 million shares worth more than $3.1 billion.
In its Q1 2021 investor letter, Polen Capital Management, an asset management firm, highlighted a few stocks and Alibaba Group Holding Limited (NYSE: BABA) was one of them. Here is what the fund said:
“Alibaba also detracted from performance as the company continues to remain under regulatory scrutiny from both the Chinese State Administration for Market Regulation on antitrust concerns and the U.S. Securities and Exchange Commission on ADR listing requirements. Despite the regulatory overhang, we believe that Alibaba’s competitive positioning and growth outlook remains intact, even if the company must pay fines or modify some business practices. We viewed the current valuation at <20x next twelve month’s earnings as a compelling opportunity to add to our position. Alibaba is the second largest position in the Portfolio.”
You can also take a peek at 10 Best Medical Stocks Under $10 and 15 Best Warren Buffett Stocks to Buy Now.
