In this article, we will look at the 10 Best Growth Stocks to Buy According to Billionaires.
Can the Stock Market Have a Big Rebound?
The stock market has been on a rollercoaster ride for the past few weeks as the sentiment has quickly shifted from post-election bullishness to being priced in for a slow-down or a recession. The volatility can be estimated by the 19% decrease in the S&P 500 from its recent all-time high. To talk about the current market volatility and the way forward, Fundstrat’s Tom Lee joined CNBC for an interview. He noted that the market is currently pessimistic as recent data shows that they have priced in a 60% probability of a recession, however, it is essential to note that if the tariff situation de-escalates then the probability of a recession isn’t that high. As a result, Lee thinks that there is a big window of opportunity for stocks to rebound, however, this rebound is contingent on the path of tariff de-escalation.
While addressing the concerns that if the market is in a bear market, Lee noted that if we define a bear market by stocks grinding and losing money, then this has been happening since December 2024. However, if you define a bear market as unleashing a type of financial tightening that leads to a recession, the current market does not fit that criteria. Lee acknowledged that it does feel like a bear market for an average person.
Lee also talked about the viable investor strategy under the current circumstances. Firstly, he highlighted that people are fighting two brains at the moment, one is a tactical brain, where people want to know if this is the bottom and be convinced by seeing the stocks rally on bad news. On the other hand, there is the investor or the long-term brain, which suggests that people should have confidence in the US companies to navigate this volatility. Lee noted that he is a buyer of this volatility as he thinks that the de-escalation of tariffs will take place, which will result in a big rebound for stocks.
With that let’s take a look at the 10 best growth stocks to buy according to billionaires.
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Our Methodology
To compile a list of the 10 best growth stocks to buy according to billionaires, we used the Finviz stock screener, Seeking Alpha, and Insider Monkey’s Billionaire database. Using the screener we aggregated a list of growth stocks that have grown their top-line by more than 30% over the past 3 years and sorted them by market cap. Next, we cross-checked each stock’s sales growth from Seeking Alpha and ranked the stocks in ascending order of the number of billionaire investors. Please note that we have also included the hedge funds sentiment around each stock, as of Q4 2024.
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. Our quarterly newsletter’s strategy selects 14 small-cap and large-cap stocks every quarter and has returned 373.4% since May 2014, beating its benchmark by 218 percentage points (see more details here).
10 Best Growth Stocks to Buy According to Billionaires
10. Ascendis Pharma A/S (NASDAQ:ASND)
3-Years Sales Growth: 260.25%
Number of Hedge Fund Holders: 45
Number of Billionaires: 7
Value of Billionaire Holdings: $287,209,394
Ascendis Pharma A/S (NASDAQ:ASND) is a Danish biopharmaceutical company. It specializes in developing treatments for various medical conditions including growth hormone deficiency, endocrinology-related disorders, central nervous system disorders, and more.
On April 11, Tazeen Ahmad, who is an analyst at Bank of America Securities, maintained a Buy rating on the stock while keeping the price target constant at $192. The analyst’s rating is based on the promising demand for the company’s Yorvipath. A recent survey conducted by endocrinologists revealed a strong uptake for uncontrolled HPT patients since the launch of the drug. Tazeen believes this represents a positive reception of Ascendis Pharma A/S (NASDAQ:ASND) products in health care.
During the fiscal fourth quarter of 2024, Ascendis Pharma A/S (NASDAQ:ASND) reported Yorvipath had 908 prescriptions as of February 7, representing a strong early launch. Moreover, the full-year revenue for the drug reached €28.7 million. Management expects the commercial launch of this product in 5 additional European markets during the year. It is one of the best growth stocks to buy according to billionaires.
9. Cloudflare, Inc. (NYSE:NET)
3-Years Sales Growth: 36.50%
Number of Hedge Fund Holders: 55
Number of Billionaires: 8
Value of Billionaire Holdings: $377,786,139
Cloudflare, Inc. (NYSE:NET) is an international cloud services company that focuses on connectivity, security, and performance of internet-based applications. It operates through several key segments including Security Solutions, Performance Enhancement, Reliability, Zero Trust Infrastructure, and more.
On April 9, Shaul Eyal from TD Cowen reiterated a Buy rating on the stock with a price target of $150. The analyst has based his rating on various factors that are expected to enhance the company’s performance and market position. Eyal noted that Cloudflare, Inc. (NYSE:NET) is expected to deliver Q1 2025 results in alignment with the market expectations, which is revenue around $470 million and non-GAAP EPS of $0.16. Moreover, he also highlighted that the company’s cyber security offerings continue to attract demand thereby acting as a significant growth factor.
In addition to the analyst rating, Baron Fifth Avenue Growth Fund added Cloudflare, Inc. (NYSE:NET) to its portfolio, as mentioned in its Q4 2024 investor letter. The fund noted that the company continues to report solid results such as a 28% year-over-year revenue growth in its fiscal fourth quarter of 2024. More notably, the company also improved its non-GAAP operating margins by 210 bps to reach 14.8% during the same time. The fund also highlighted that the customer addition remains strong which is anticipated to attract significant growth for the company. It is one of the best growth stocks to buy according to billionaires.
Baron Fifth Avenue Growth Fund stated the following regarding Cloudflare, Inc. (NYSE:NET) in its Q4 2024 investor letter:
“We took advantage of recent inflows to add to several of our existing holdings, in which our relative conviction level and attractive valuations warranted an increase in position sizes. Our largest addition was Cloudflare, Inc. (NYSE:NET), which offers enhanced security and performance for websites, apps, and software as a service. The company continues reporting solid quarterly results with 28% year-on-year revenue growth and 14.8% non-GAAP operating margins, which increased 210bps year-on-year. A double-digit year-on-year increase in sales productivity has started to benefit EMEA and APAC growth rates. Customer additions were also robust and remaining performance obligations were well ahead of expectations, up 39%. In addition, the company announced the hiring of CJ Desai as President of Product & Engineering, a well-regarded executive that helped build ServiceNow into one of the best software businesses of all time – and a large position in the portfolio. Our relative conviction in Cloudflare warranted adding to our position, given the company’s visionary management team, and stacking S curves or markets that it can address with its platform as it helps companies modernize their networking infrastructure.”
