In this article, we will take a look at the 10 Best High Volume Stocks To Buy According to Hedge Funds.
On September 18, the Federal Reserve implemented its first interest rate cut since the onset of the COVID-19 pandemic, reducing benchmark rates by half a percentage point to counter a potential labor market slowdown. This adjustment brings the federal funds rate to 4.75% to 5%. Aside from the emergency rate cuts during the pandemic, the last time the Federal Open Market Committee (FOMC) made a half-point reduction was during the 2008 global financial crisis. Following the decision, Fed Chairman Jerome Powell made the following remarks:
“We’re trying to achieve a situation where we restore price stability without the kind of painful increase in unemployment that has come sometimes with this inflation. That’s what we’re trying to do, and I think you could take today’s action as a sign of our strong commitment to achieve that goal.”
The post-meeting statement emphasized that the Federal Reserve has grown more confident in inflation moving sustainably toward the 2% target. It believes the risks to achieving its employment and inflation goals are now roughly balanced. Wall Street expects that the ensuing rate cuts will enable well-established, financially stable companies to boost spending and investments, potentially driving up their stock prices through the remainder of 2024 and into early 2025. Similarly, Wells Fargo analysts suggest that the global economy stands to benefit as many major central banks have already announced or are expected to announce rate cuts. However, not everyone is optimistic. Billionaire investor Ray Dalio highlighted that the U.S. economy continues to grapple with an “enormous amount of debt.” During an interview, he pointed out that the Federal Reserve faces the challenge of maintaining interest rates high enough to benefit creditors, while not raising them so much that they become burdensome for debtors. Dalio described this as a difficult “balancing act”.
On another front, the Conference Board’s consumer confidence index dropped to 98.7 in September, down from 105.6 in August, marking the largest one-month decline since August 2021. This was below the Dow Jones forecast of 104 and significantly lower than the pre-pandemic level of 132.6 recorded in February 2020. All five components of the index saw declines, with the most significant drop occurring among those aged 35-54 and earning less than $50,000. The last time the index fell this sharply was when inflation was starting its rise to a 40-year high. Commenting on the sentiment shift, Dana Peterson, chief economist at The Conference Board, noted:
“Consumers’ assessments of current business conditions turned negative while views of the current labor market situation softened further. Consumers were also more pessimistic about future labor market conditions and less positive about future business conditions and future income.”
Within a complex economic landscape marked by mixed signals across sectors, investor sentiment remains cautiously optimistic, with market participants closely watching economic indicators and Fed policies to identify future trends. With this in mind, we present a list of the 10 Best High Volume Stocks To Buy According to Hedge Funds.
Our Methodology
We used stock screeners to identify stocks that met specific criteria as of September 23. Our selection criteria was focused on stocks with notable market activity, including a 3-month average trading volume exceeding 5 million shares. We also considered companies with a quarterly revenue growth rate of over 15%. Additionally, we highlighted the number of hedge funds invested in each stock, as of Q2 2024.
At Insider Monkey, we are obsessed with 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 275% since May 2014, beating its benchmark by 150 percentage points (see more details here).
10. Palantir Technologies Inc. (NYSE:PLTR)
Avg Volume: 50.89 million
Quarterly Revenue Growth: 27.15%
Number of Hedge Fund Holders: 44
Palantir Technologies Inc. (NYSE:PLTR) specializes in big data analytics software and is recognized as a leader in artificial intelligence and machine learning platforms. On September 18, the company hit a new 52-week high, with its stock price reaching $37.05.
Palantir Technologies Inc. (NYSE:PLTR) recently announced a multi-year contract with Nebraska Medicine to implement its Artificial Intelligence Platform (AIP), which has already delivered substantial improvements in healthcare operations and patient care.
For the second quarter of fiscal year 2024, Palantir Technologies Inc. (NYSE:PLTR) reported a 27% year-over-year earnings increase, with total revenue reaching $678.1 million. The company also raised its full-year revenue guidance to $2.746 billion. BofA Securities maintained its Buy rating on the stock.
According to Insider Monkey’s Q2 2024 data, 44 hedge funds held stakes in Palantir Technologies Inc. (NYSE:PLTR), with a total value of $2.54 billion.
Carillon Scout Mid Cap Fund stated the following regarding Palantir Technologies Inc. (NYSE:PLTR) in its first quarter 2024 investor letter:
“The top contributor to return for the quarter was Palantir Technologies Inc. (NYSE:PLTR). Sentiment improved on Palantir after it reported stronger than expected commercial customer revenue and free cash flow. U.S. commercial growth was especially encouraging, as U.S. commercial revenue was up by a large percentage year over year for the fourth quarter and U.S. commercial customer count grew nearly as much. We expect Palantir to become one of the premier artificial intelligence (AI) software providers, built on its Foundry and AIP platforms.”
9. Carnival Corporation & plc (NYSE:CCL)
Avg Volume: 27.95 million
Quarterly Revenue Growth: 17.72%
Number of Hedge Fund Holders: 53
Carnival Corporation & plc (NYSE:CCL) operates cruise ships that provide vacation experiences to destinations across North America, the UK, Germany, and other regions.
Stifel recently raised its price target for Carnival’s shares from $25.00 to $27.00, maintaining a Buy rating. The firm anticipates that Carnival Corporation & plc (NYSE:CCL) may increase its full-year guidance during its earnings report on September 30, citing strong last-minute demand and pricing.
In its record-breaking Q2 earnings, Carnival Corporation & plc (NYSE:CCL) exceeded guidance with a $170 million bottom-line outperformance, driven by a 12% yield increase. The company achieved all-time highs in revenues, operating income, customer deposits, and booking levels. Looking ahead, Carnival Corporation & plc (NYSE:CCL) forecasts an 8% yield growth for Q3 and has improved its full-year net income guidance by $275 million, thanks to higher yields and cost savings.
Additionally, Carnival Corporation & plc (NYSE:CCL) announced the expansion of its fleet with three new liquefied natural gas (LNG)-powered ships set for delivery in 2029, 2031, and 2033, in partnership with Italian shipbuilder Fincantieri. These will be the largest ships in Carnival’s global fleet.
According to Insider Monkey’s Q2 2024 data, 53 hedge funds reported holding stakes in Carnival Corporation & plc (NYSE:CCL).
8. Shopify Inc. (NYSE:SHOP)
Avg Volume: 8.52 million
Quarterly Revenue Growth: 20.72%
Number of Hedge Fund Holders: 56
Shopify Inc. (NYSE:SHOP) is a leading provider of commerce infrastructure, offering businesses the tools to launch, scale, and manage their operations across all levels. With millions of businesses in 175 countries using its platform, Shopify plays a vital role in supporting diverse enterprises worldwide.
Roth/MKM has reaffirmed its positive outlook on Shopify Inc. (NYSE:SHOP), maintaining a Buy rating and a $79 price target. Following discussions with Shopify’s CFO, Jeff Hoffmeister, and Head of Investor Relations, Carrie Gillard, the firm expressed confidence in Shopify’s core financials. Key growth drivers identified include international expansion, point-of-sale (POS) systems, and enterprise services. Roth/MKM highlighted Shopify’s ability to scale efficiently, with only a moderate increase in operating costs projected through 2025, positioning the company well for future growth.
Shopify’s recent financial performance has been impressive, with a 25% year-over-year revenue increase in Q2, accompanied by rising gross profits. The company has reduced operating expenses, marking its fourth consecutive quarter of profitability. Its point-of-sale solution saw a 27% increase in offline Gross Merchandise Volume, and the company continues to advance in B2B commerce and global expansion.
According to Insider Monkey’s analysis of 912 hedge funds in Q2 2024, 56 held investments in Shopify Inc. (NYSE:SHOP), with ARK Investment Management, led by Catherine D. Wood, being the largest investor, holding 4.96 million shares valued at $328 million.
Polen Capital mentioned Shopify Inc. (NYSE:SHOP) in its Q2 2024 investor letter. Here is what the fund said:
“Shopify’s business model combines 1) a mission-critical software business where merchants can run all their business operations from one dashboard and 2) a payments business with a long runway to increase attach rates and grow alongside merchants. Additionally, we believe the business possesses significant optionality to continue attaching existing merchant solutions and adding more merchant services as high-margin cross-sells. With several powerful tailwinds at their back (e-commerce, mobile commerce, social media, digital payments, seamless omnichannel, DTC, cloud software digitization) and a highly scalable business model, we think their growth will likely be stronger for longer than investors expect.”
7. CrowdStrike Holdings, Inc. (NASDAQ:CRWD)
Avg Volume: 8.19 million
Quarterly Revenue Growth: 31.74%
Number of Hedge Fund Holders: 69
CrowdStrike Holdings, Inc. (NASDAQ:CRWD) is a cybersecurity company offering a broad range of security solutions, including identity management, threat intelligence, and threat detection.
BMO Capital remains optimistic about CrowdStrike’s performance, maintaining an Outperform rating and a $315 price target following the company’s Fal.Con 2024 user and analyst event. Despite potential revisions to estimates and some market volatility, BMO expressed confidence in the company’s strong position within the cybersecurity industry.
In its second fiscal quarter, CrowdStrike Holdings, Inc. (NASDAQ:CRWD) exceeded expectations in annual recurring revenue (ARR), total revenue, and non-GAAP earnings per share. However, the company’s guidance for Q3 and fiscal year 2025 came in below consensus estimates, with management reaffirming their long-term ARR target of $10 billion by fiscal year 2031.
At the end of Q2 2024, 69 hedge funds held stakes in CrowdStrike Holdings, Inc. (NASDAQ:CRWD), with total investments reaching $3.01 billion. Citadel Investment Group was the largest shareholder, holding a position valued at $574.6 million as of June 30.
TimesSquare Capital Management U.S. Focus Growth Strategy stated the following regarding CrowdStrike Holdings, Inc. (NASDAQ:CRWD) in its Q2 2024 investor letter:
“Our cybersecurity holdings were also beneficial to the strategy this quarter. That included the 20% gain from CrowdStrike Holdings, Inc. (NASDAQ:CRWD), a cloud-based network security service provider that supports a range of devices, endpoints, and cloud environments. CrowdStrike’s revenues and earnings exceeded expectations, with 33% growth in annual recurring revenue. CrowdStrike continues to see growing momentum in emerging areas such as Cloud Security, Identity, and Security Information & Event Management where it is displacing legacy providers. That led CrowdStrike’s management to increase its guidance for revenues and earnings for the balance of its fiscal year.”
6. PDD Holdings Inc. (NASDAQ:PDD)
Avg Volume: 11.14 million
Quarterly Revenue Growth: 79.95%
Number of Hedge Fund Holders: 86
PDD Holdings Inc. (NASDAQ:PDD) is a global commerce group with a diverse portfolio that includes two major ventures: Pinduoduo, an e-commerce platform, and Temu, an online marketplace.
The company’s non-GAAP net profit for the latest quarter surged 125.5% year-over-year, reaching RMB 34.4 billion, exceeding expectations thanks to stronger-than-expected gross profit margins and strict expense control. Earnings per American depositary share (EPADS) for 2024 increased by 140% year-over-year, aligning with projections. Revenue also climbed 86% year-over-year to CNY 97 billion. However, management has adjusted its operating profit margin forecast downward for the second half of 2024.
In light of these developments, China Galaxy International anticipates PDD’s revenue will grow by 42% and its non-GAAP net profit will rise by 33% year-over-year in the third quarter of 2024. The firm maintains an “Add” rating, now with a revised discounted cash flow (DCF)-based target price of $168.
According to Insider Monkey’s Q2 data, 86 hedge funds held long positions in PDD Holdings Inc. (NASDAQ:PDD), an increase from 76 in the previous quarter. Rajiv Jain’s GQG Partners remains the largest stakeholder, owning 10.8 million shares valued at $1.43 billion.
5. Micron Technology (NASDAQ:MU)
Avg Volume: 25.25 million
Quarterly Revenue Growth: 81.53%
Number of Hedge Fund Holders: 120
Micron Technology Inc. (NASDAQ:MU) specializes in producing computer memory and data storage solutions, including dynamic random-access memory, flash memory, and USB flash drives.
In the fiscal third quarter of 2024, the company reported revenue of $6.8 billion, a significant increase from $3.7 billion in the same period last year, marking an approximately 82% year-over-year growth driven primarily by robust demand for AI technologies. Despite this impressive performance, Micron may face challenges due to an inventory surplus from the previous year.
On September 17, Citi revised its outlook for Micron Technology Inc. (NASDAQ:MU), lowering the stock’s price target to $150 from $175 while maintaining a Buy rating. This adjustment comes ahead of the company’s fiscal fourth quarter 2024 results, set to be announced on September 25 after market close. Citi’s analysis highlights an accumulation of DRAM inventory in the PC and smartphone markets but anticipates that this backlog will be resolved by year-end. Despite the short-term challenges, Citi remains optimistic about Micron’s prospects, expecting improvements in revenue and gross margins in the coming quarters.
Additionally, Micron Technology Inc. (NASDAQ:MU) recently launched its Crucial P310 2280 Gen4 NVMe solid-state drive (SSD), which offers double the performance of Gen3 SSDs and a 40% speed increase over its predecessor. This new SSD targets a wide consumer base, including gamers, students, and creative professionals.
Micron Technology, Inc. (NASDAQ:MU) appeared in the 13F holdings of 120 hedge funds during the second quarter, with a combined stake valued at $5.2 billion.
ClearBridge Value Equity Strategy stated the following regarding Micron Technology, Inc. (NASDAQ:MU) in its Q2 2024 investor letter:
“Stock selection in the IT sector proved to be the largest contributor to performance, particularly driven by the strong performance of Micron Technology, Inc. (NASDAQ:MU) The company, which designs, develops, manufactures and sells memory and storage products, continued its strong performance alongside other AI beneficiaries as the anticipated demand for new and additional storage essential for housing and training large language AI models continues to grow.”
4. Broadcom Inc. (NASDAQ:AVGO)
Avg Volume: 33.88 million
Quarterly Revenue Growth: 47.27%
Number of Hedge Fund Holders: 130
Broadcom Inc. (NASDAQ:AVGO) is a global technology leader specializing in the design, development, and supply of a wide array of semiconductor, enterprise software, and security solutions.
TD Cowen has maintained a positive outlook on Broadcom Inc. (NASDAQ:AVGO), reaffirming a Buy rating and setting a price target of $210. Analysts noted the company’s strong performance in key growth sectors, such as Networking and AI, following its third fiscal quarter earnings call. They also highlighted that the integration of VMWare is progressing as planned, despite some ongoing softness in non-AI-related segments of the business.
For the third quarter of fiscal year 2024, Broadcom Inc. (NASDAQ:AVGO) reported a 47% year-over-year increase in consolidated net revenue, reaching $13.1 billion. The company raised its AI-related revenue forecast for the year to $12 billion, driven by strong demand from major cloud service providers.
Additionally, Broadcom Inc. (NASDAQ:AVGO) is poised to benefit from the rollout of Wi-Fi 7 in all new iPhone models, having announced a partnership with Tower Semiconductor to produce Wi-Fi 7 RF front-end modules (FEMs).
In the second quarter, 130 hedge funds held long positions in Broadcom Inc. (NASDAQ:AVGO), with a total stake valued at $20.04 billion.
3. Uber Technologies, Inc. (NYSE:UBER)
Avg Volume: 15.59 million
Quarterly Revenue Growth: 15.93%
Number of Hedge Fund Holders: 145
Uber Technologies, Inc. (NYSE:UBER) is a leading global provider of ride-hailing, food delivery, and freight services, transforming urban transportation by connecting passengers with drivers through its mobile app since its founding.
BTIG has reaffirmed its positive outlook on Uber Technologies, Inc. (NYSE:UBER), maintaining a Buy rating with a price target of $90. Their analysis highlights high single-digit growth in delivery and mid-teen growth in rideshare, with Uber Technologies, Inc. (NYSE:UBER) successfully retaining its market share in both sectors. This is particularly noteworthy in the United States, which accounts for around 40% of Uber’s bookings.
In the second quarter of 2024, the company reported impressive results, with gross bookings and adjusted EBITDA increasing by 21% and 71% year-over-year, respectively. Additionally, Uber Technologies, Inc. (NYSE:UBER) has formed a strategic partnership with Turo, the world’s largest peer-to-peer car-sharing marketplace, to enhance its car rental offerings across various countries.
In Q2, 145 hedge funds held positions in Uber Technologies, Inc. (NYSE:UBER), with a total stake valued at $8.7 billion. As of June 30, Altimeter Capital Management emerged as the largest shareholder, holding 13.515 million shares.
2. Taiwan Semiconductor Manufacturing Company Limited (NYSE:TSM)
Avg Volume: 16.74 million
Quarterly Revenue Growth: 33.01%
Number of Hedge Fund Holders: 156
Taiwan Semiconductor Manufacturing Company Limited (NYSE:TSM) is a Taiwan-based semiconductor firm that provides integrated circuits and other semiconductor devices to major tech companies, including Apple and NVIDIA.
In the second quarter of 2024, Taiwan Semiconductor Manufacturing Company Limited (NYSE:TSM) reported a 13.6% sequential increase in revenue, driven by rising demand for its advanced nanometer technologies. The company anticipates a 50% compound annual growth rate (CAGR) in revenue from AI chips by 2027 and projects overall revenue growth of 20% for the year ending 2024.
Bernstein has maintained an Outperform rating on TSM, noting that the stock remains attractively valued, particularly as the company is positioned to perform well during a recession. Analysts from Bernstein expect the company’s revenue to grow by 26% and earnings per share by 29% this year, with continued momentum into 2025 and beyond. This growth is fueled by strong demand from data center AI and high-end smartphones utilizing TSMC’s advanced N3 and N4/5 nodes.
As of the end of Q2 2024, Taiwan Semiconductor Manufacturing Company Limited (NYSE:TSM) was held by 156 hedge funds, with total stakes valued at $21.28 billion. Fisher Asset Management was the largest shareholder, holding a position worth $4.94 billion as of June 30.
Ave Maria World Equity Fund stated the following regarding Taiwan Semiconductor Manufacturing Company Limited (NYSE:TSM) in its Q2 2024 investor letter:
“Top contributors to performance included SharkNinja, Inc. and Taiwan Semiconductor Manufacturing Company Limited (NYSE:TSM). Taiwan Semiconductor Manufacturing Company Limited is the global leader in semiconductor foundry services, with a dominant market share position in advanced semiconductors. The company has significant pricing power and stands to benefit from secular “megatrends” (5G, high performance computing, AI, rising silicon content per device, etc.) due to its technological leadership.”
1. NVIDIA Corporation (NASDAQ:NVDA)
Avg Volume: 340.04 million
Quarterly Revenue Growth: 122.40%
Number of Hedge Fund Holders: 179
NVIDIA Corporation (NASDAQ:NVDA) is a market leader in designing and selling Graphics Processing Units (GPUs), a sector that has experienced significant growth due to rising demand for artificial intelligence models. Over the past four quarters, NVIDIA has achieved record results, with profit margins exceeding 60%.
Recently, William Blair initiated coverage of NVIDIA Corporation (NASDAQ:NVDA) with an Outperform rating, recognizing the company’s leadership in parallel computing and its strong position in the AI industry. The firm highlighted NVIDIA’s extensive history in designing parallel computing systems, which has enabled the company to penetrate high-growth markets such as gaming, automotive, and high-performance computing (HPC). Analysts noted that NVIDIA’s data center revenue soared by 217% in fiscal 2024 and is projected to grow by 132% in fiscal 2025, potentially exceeding $110 billion, up from just $15 billion in fiscal 2023. William Blair also emphasized that NVIDIA’s system-level approach has expanded its total addressable market from approximately $100 billion in GPUs to a broader $800 billion semiconductor market and a $1.6 trillion cloud services market.
In the second quarter, a total of 179 hedge funds held long positions in NVIDIA Corporation (NASDAQ:NVDA), with a combined stake value of $53.7 billion.
While NVDA is an exceptional investment, we believe that certain AI stocks hold promise for delivering high returns and doing so within a shorter timeframe. If you are looking for an AI stock that is more promising than the ones mentioned in our list but that trades at less than 5 times its earnings, check out our report about the cheapest AI stock.
READ NEXT: $30 Trillion Opportunity: 15 Best Humanoid Robot Stocks to Buy According to Morgan Stanley and Jim Cramer Says NVIDIA ‘Has Become A Wasteland’.
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