In this article, we will discuss the 8 Best Quality Growth Stocks to Buy.
On June 2, Dan Niles, Niles Investment Management, joined ‘Closing Bell Overtime’ on CNBC to talk parabolic moves in the tech trade and what these massive gains signal. When asked about the rationality behind the dramatic vertical moves in stocks following HPE earnings, Niles asserted that a market can be irrational while still having significant room to run. He noted that while bearish analysts have been calling for a semiconductor downturn since March of last year, the formalization of agentic AI on January 30 triggered a massive surge in token production, which increased by over 130% in the following two months. This suggests that the industry is in a new wave of demand that corporations will likely take another year to fully embrace, leading Niles to expect continued upside through the end of the year.
Regarding the debate over whether these market moves are structural or just a hot cycle, Niles argued that it depends on the definition of overvaluation. He suggested that while some stocks might be overvalued at 100x revenue, the disparity in valuations makes selective stock picking essential. He emphasized that market bottlenecks are constantly shifting and noted that while CPUs were previously ignored, a change in ratios identified by his firm in late March has brought them to the forefront of market attention.
Our Methodology
We sifted through the Vanguard US Quality Factor ETF holdings to identify stocks that have a track record of delivering earnings growth and have grown their EPS by at least 20% over the past 3 years. We limited our final selection to companies that have recently reported noteworthy developments likely to impact investor sentiment. These stocks are also popular among analysts and elite hedge funds.
Note: All data was sourced on June 4.
Why are we interested in the stocks that hedge funds pile into? The reason is simple: our research has shown that we can outperform the market by imitating the top stock picks of the best hedge funds. Insider Monkey’s quarterly newsletter’s strategy selects 14 small-cap and large-cap stocks every quarter and has returned 599.2% since May 2014, beating its benchmark by 372 percentage points (see more details here).
8 Best Quality Growth Stocks to Buy
8. Fortinet Inc. (NASDAQ:FTNT)
Number of Hedge Fund Holders: 52
Fortinet Inc. (NASDAQ:FTNT) is one of the best quality growth stocks to buy. On May 6, Fortinet expanded its FortiGate G series with the launch of the 3500G and 400G next-generation firewalls. These new models are engineered to provide high-performance, ASIC-accelerated security that handles the demands of encrypted traffic, distributed environments, and AI-driven workloads without forcing a trade-off between speed and protection.
The FortiGate 3500G is designed for data center scale, offering 400Gb connectivity and hardware-enforced integrity protections to establish a foundation of verified trust. Simultaneously, the FortiGate 400G modernizes the enterprise edge, providing high-density performance and operational consistency that allows organizations to upgrade their infrastructure with minimal disruption.
Both platforms are integrated into the broader Fortinet Inc. Security Fabric, using the FortiOS operating system and AI-powered threat intelligence. These additions provide organizations with native shadow AI detection, improved visibility into data flows, and centralized management to simplify operations and reduce complexity across hybrid network environments.
Fortinet Inc. provides cybersecurity and convergence of networking and security solutions worldwide.
7. Expedia Group Inc. (NASDAQ:EXPE)
Number of Hedge Fund Holders: 62
Expedia Group Inc. (NASDAQ:EXPE) is one of the best quality growth stocks to buy. On May 20, Expedia entered into an agreement to acquire CarTrawler, an Irish B2B platform specializing in car rental, ground transport, and Insurtech solutions. This acquisition is a strategic move to advance Expedia’s goal of building the most comprehensive B2B travel platform by integrating CarTrawler’s extensive network of over 550 car rental and 500 mobility suppliers.
The partnership aims to unlock significant growth by combining CarTrawler’s specialized expertise with Expedia Group’s global scale and technology. Supply partners will gain access to a larger distribution network, while B2B demand partners and consumers will benefit from enhanced choice, competitive pricing, and seamless integration of ground transportation and insurance services.
This deal follows Expedia Group Inc.’s (NASDAQ:EXPE) previous acquisition of Tiqets, further diversifying its API offerings beyond lodging. Expected to close in H2 2026, the transaction remains subject to customary closing conditions and will allow CarTrawler to continue its mission as a core component of Expedia’s broader B2B engine.
Expedia Group Inc. is an online travel company, providing travel products and services in the B2C, B2B, and Trivago segments. The company is based in Seattle, Washington, and was founded in 1994.
6. Trane Technologies (NYSE:TT)
Number of Hedge Fund Holders: 68
Trane Technologies (NYSE:TT) is one of the best quality growth stocks to buy. On May 20, Trane Technologies unveiled a new AI Lab and immersive showroom in Montréal, Canada, designed to accelerate the development of autonomous HVAC and transport refrigeration solutions. This innovation hub serves as a central point for researchers and engineers to advance the company’s mission of utilizing AI to lower carbon emissions and improve energy efficiency in the built environment.
The facility functions as both a collaborative development center and an experiential space where guests can observe how predictive models and agentic AI are actively transforming building operations. Building on the acquisition of BrainBox AI, the lab focuses on moving breakthrough concepts into practical, customer-ready applications that address the growing demand for sustainable and cost-effective climate technology.
Supported by partnerships with organizations like AWS and Concordia University, the lab emphasizes the importance of ethical and responsible innovation. By fostering collaboration among top technical talent, Trane Technologies aims to scale its digital solutions, ensuring that advancements in AI continue to drive meaningful environmental impact and long-term sustainability for its global customers.
Trane Technologies is a climate innovation manufacturer. It supplies mission-critical cooling infrastructure for data centers, engineering high-capacity chillers and advanced liquid-cooling systems to manage the intense thermal loads of modern AI server halls.
5. Gilead Sciences Inc. (NASDAQ:GILD)
Number of Hedge Fund Holders: 77
Gilead Sciences Inc. (NASDAQ:GILD) is one of the best quality growth stocks to buy. On June 4, Gilead Sciences and Lakefront Biotherapeutics completed the acquisition of Ouro Medicines, a strategic move designed to bolster their inflammation and immunology pipelines. The centerpiece of this acquisition is gamgertamig (OM336), a clinical-stage T cell engager being developed as a potential first-in-class treatment for severe, antibody-mediated orphan autoimmune diseases like AIHA and ITP.
Under the partnership agreement, Lakefront will manage ongoing and future Phase 1/2 clinical studies for gamgertamig, while Gilead leads registrational and late-stage development. Gilead holds sole global commercialization rights, with Lakefront entitled to tiered royalties ranging from 20% to 23%. Additionally, Lakefront has secured three preclinical autoimmune programs from Ouro, with Gilead maintaining an opt-in right for a future profit-sharing collaboration.
This transaction supports Gilead’s objective of advancing therapies that move beyond chronic disease management toward durable immune reset. The acquisition also provides Lakefront with the operational assets and research foundation to accelerate its own development pipeline, with the company projecting a strong cash balance of ~€2 billion by the end of 2026 to support further strategic initiatives.
Gilead Sciences Inc. is a drug manufacturer that develops medicines for unmet medical needs. The company provides treatments for HIV-1, chronic hepatitis C, primary biliary cholangitis, chronic hepatitis B, and serious invasive fungal infections. It also offers T-cell and CAR T-cell therapies for adult patients, intravenous injections, and treatments for COVID-19.
4. Take-Two Interactive Software Inc. (NASDAQ:TTWO)
Number of Hedge Fund Holders: 77
Take-Two Interactive Software Inc. (NASDAQ:TTWO) is one of the best quality growth stocks to buy. On May 21, Take-Two Interactive Software reported a strong finish to FY26, with total net bookings reaching $6.72 billion, an increase of 19% over the previous year. Q4 generated $1.58 billion in net bookings, driven largely by recurrent consumer spending, which accounted for 82% of the total, supported by key titles such as NBA 2K26, Grand Theft Auto Online, and Grand Theft Auto V.
Looking ahead to FY27, the company has provided an initial outlook projecting net bookings between $8.0 billion and $8.2 billion. Management expects to reach record levels of operating performance, anchored by the highly anticipated release of Grand Theft Auto VI, scheduled for November 19, alongside continued optimization of their live services portfolio.
Take-Two Interactive Software Inc.’s (NASDAQ:TTWO) strategy remains focused on sustaining long-term shareholder value through a robust development pipeline and disciplined capital allocation. While navigating the current economic environment, the company plans to capitalize on growth across console, PC, and mobile platforms, with a diverse slate of upcoming releases including NBA 2K27, Judas, and the next iteration of the BioShock franchise.
Take-Two Interactive Software Inc. is one of the world’s largest video game publushed companies, with its popular online, open-world games function early expressions of the metaverse. It focuses on creating immersive digital spaces for social interaction, entertainment, and commerce, primarily through Rockstar Games and 2K.
3. Walmart Inc. (NASDAQ:WMT)
Number of Hedge Fund Holders: 99
Walmart Inc. (NASDAQ:WMT) is one of the best quality growth stocks to buy. On June 3, Walmart announced a $10.8 million philanthropic investment in Matthew 25: Ministries (M25M) to significantly expand its national disaster response fleet. In collaboration with Procter & Gamble (P&G), this initiative aims to strategically position relief vehicles across the country, ensuring they remain within an 8-hour drive of 90% of the mainland US to provide rapid support during crises.
The expansion will introduce seven new laundry and multi-service shower trailers, along with tow vehicles and generators, staged across eight regional hubs. By June 2027, this fleet will be equipped to support 48 annual activations, delivering hot showers, clean laundry, and essential personal care products from P&G brands such as Bounty, Crest, and Pampers to communities during the critical 24 to 36 hours following a disaster.
This grant strengthens a long-standing partnership between the three organizations, building on a successful relief model that has already provided vital services to disaster zones. By combining Walmart Inc.’s (NASDAQ:WMT) infrastructure funding with P&G’s supply donations and co-funding, the collaboration seeks to bridge the gap between immediate crisis response and long-term recovery, offering emotional resilience and essential care to families in hard-to-reach areas.
Walmart Inc. is an omnichannel retailer operating retail and wholesale stores, clubs, e-commerce websites, and mobile applications. It offers an elaborate array of items, from general merchandise and electronics to food, groceries, and more.
2. Netflix Inc. (NASDAQ:NFLX)
Number of Hedge Fund Holders: 144
Netflix Inc. (NASDAQ:NFLX) is one of the best quality growth stocks to buy. Announced on June 4, Netflix now integrates GenAI and NL processing to help subscribers navigate content overload and simplify the decision-making process. Elizabeth Stone, the company’s chief product and technology officer, announced that these new capabilities are designed to provide a more personalized, interactive, and immersive experience, helping viewers quickly identify entertainment that matches their specific mood and preferences.
The platform is currently testing a voice user interface and advanced recommendation experiments that combine an individual’s viewing history with real-time trends. By analyzing these factors, Netflix aims to deliver highly tailored suggestions, addressing growing consumer frustration regarding the sheer volume of available content and the difficulty of finding what to watch at any given moment.
This initiative reinforces Netflix Inc.’s (NASDAQ:NFLX) long-standing focus on recommendation technology as a core strength. By using AI to better understand user intent and context, the service seeks to maintain its position at the forefront of digital entertainment innovation, ensuring that users can easily discover and enjoy content that is uniquely right for them.
Netflix Inc. is a global streaming service offering TV shows, movies, documentaries, and interactive content. It operates a subscription model, produces “Original” content, and supports both ad-free and ad-supported viewing across devices.
1. NVIDIA Corporation (NASDAQ:NVDA)
Number of Hedge Fund Holders: 275
NVIDIA Corporation (NASDAQ:NVDA) is one of the best quality growth stocks to buy. On June 3, NVIDIA introduced new physical AI agent skills at CVPR 2026 designed to accelerate the development of AVs, robotics, and vision AI. By integrating these capabilities with NVIDIA Cosmos 3, the company aims to resolve the fragmentation in current research workflows, allowing developers to unify scene reconstruction, data generation, policy training, and evaluation into a single, scalable pipeline.
For autonomous vehicle research, the new tools leverage neural reconstruction and generative models, such as the 32-billion-parameter Alpamayo 2 Super VLA model, to overcome the “long tail” of driving challenges. These skills enable researchers to convert fleet data into editable 3D scenes and conduct closed-loop reinforcement learning in high-fidelity simulations. Similarly, new Metropolis skills for vision AI and Isaac frameworks for robotics automate the creation of synthetic scenarios and environments, significantly reducing the manual labor typically required for training and validation.
These advancements are supported by an expanded research infrastructure, including new datasets and “Physical AI Launchables” available on NVIDIA Brev, which provide preconfigured environments for rapid experimentation. By offering these tools openly via GitHub, NVIDIA Corporation is enabling global research institutions to streamline the transition from model capabilities to actionable, real-world autonomous systems, further cementing the role of its hardware and software ecosystem in the future of physical AI.
NVIDIA Corporation is a fabless semiconductor and AI computing company that designs GPUs, AI accelerators, 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.
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