In this article, we will be looking into the 10 Best Stocks to Buy, According to Billionaire Ray Dalio.
Ray Dalio, with over 50 years of experience, is arguably one of the most influential investors on Wall Street. Having accurately predicted the 2008 financial crisis, he is often looked upon for insights and the direction the market will likely take in times of uncertainty. He is the brains behind Bridgewater Associates, a hedge fund he founded in 1973, which leverages various strategies, including Pure Alpha and macroeconomic analysis, to squeeze optimum returns in the markets.
While Dalio gave up his CEO role at Bridgewater Associates in 2017, his sentiments still influenced the hedge fund’s investment strategy and play. Likewise, the hedge fund has remained on top of its game, generating an average return of 11.5% annually while leveraging the Pure Alpha Strategy.
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The outperformance comes as the overall equity market has been in an uptrend amid the artificial intelligence-driven run. Likewise, the US economy staying clear of recession amid high interest has bolstered sentiments about market risk-taking.
Even though the overall equity market has been in an uptrend, billionaire Ray Dalio is sounding the warning bells about an imminent debt crisis. The fact that the US debt-to-GDP ratio has risen to over 122% poses significant risks, according to the founder of Bridgewater Associates.
Over the last two quarters, GDP has been gradually increasing, and unemployment and inflation have been relatively stable. However, Ray Dalio has warned that America’s national debt is a problem that is imminently coming and that it will rock the boat. According to Dalio, the US deficit must drop from a projected 7.2% of gross domestic product to about 3% of GDP.
“We have a very severe supply and demand problem. Some people think we’ll handle it because we’ve handled it so far. I don’t think they understand the mechanics of debt.” Dalio said
Dalio’s caution comes as President Donald Trump’s administration struggles to retain significant tax cuts while simultaneously cutting the annual deficit, which most recently hit $1.8 trillion.
According to Dalio, President Trump has undoubtedly shown that he is not afraid to use economic pressure to further his objectives. An examination of his executive orders since assuming office is sufficient proof that he has what it takes to reduce the US deficit and heightened debt levels.
However, the Oval Office might have lost some of its goodwill with the countries that would have hurried to its aid by inflicting pain through trade tariffs. Uncertainty around trade policy has exacerbated investor anxiety on Wall Street as they worry about how a potential trade war will affect the world economy.
Tariffs against Canada, Mexico, and China are part of Trump’s trade policies, which are intended to rebalance the economy to America’s advantage. Nevertheless, they have the potential to trigger an economic slowdown and higher inflation.
Even as Dalio remains concerned about the US debt levels and the uncertainty triggered by trade wars, he remains bullish about the US equity markets. Bridgewater Associates’ portfolio has significant exposure to tech stocks as it looks to benefit from the AI spectacle.
Our Methodology
To make the list of the 10 Best stocks to buy, according to billionaire Ray Dalio, we selected the top 10 stocks in Bridgewater Associates’ portfolio as of its Q4 2024 13F filing. We settled on the hedge fund’s ten biggest holdings and examined why they stand out as Ray Dalio’s top stock picks. Finally, we ranked the stocks in ascending order based on the value of Bridgewater Associates equity stakes. Additionally, we have mentioned the hedge fund sentiment around each stock, as of Q4 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 373.4% since May 2014, beating its benchmark by 218 percentage points (see more details here).
10 Best Stocks to Buy, According to Billionaire Ray Dalio
10. Visa Inc. (NYSE:V)
Bridgewater Associates Equity Stakes: $193.42 Million
Number of Hedge Fund Holders: 181
Visa Inc. (NYSE:V) is a payment technology company that offers VisaNet, a transaction processing network that enables authorization, clearing, and settlement of payment transactions. It also offers credit, debit, and prepaid card products. While the stock was up by 17% in 2024, it’s already up by about 6% year to date, outperforming the S&P 500, which is down by about 3%.
Visa Inc. (NYSE:V), considered one of the top stocks by billionaire Ray Dalio, is a global leader in payment processing, with 4.7 billion cards accepted at 150 million merchant locations. It generates consistent revenue by charging 1.5% to 3.5% in transaction fees and has shown resilience during economic challenges. Since 2014, Visa’s revenue has grown at an 11% annual rate, with 16% annual earnings growth, highlighting its strong long-term prospects even during crises like the COVID-19 pandemic and global inflation.
Visa Inc. (NYSE:V) delivered solid fiscal first quarter 2025 results as it benefited from healthy spending during the holiday season and improved trends in payment volume. Revenue rose 10% to $9.5 billion, as net income rose 11% to $5.5 billion.
9. PayPal Holdings Inc. (NASDAQ:PYPL)
Bridgewater Associates Equity Stakes: $201.29 Million
Number of Hedge Fund Holders: 94
PayPal Holdings Inc. (NASDAQ:PYPL) is a financial services company that operates a technology platform that enables digital payments for merchants and consumers worldwide. While the company has struggled amid stiff competition from rival businesses, new management under new CEO Alex Chris has sought to reinvigorate its growth metrics.
The restructuring drive has also targeted the product line, resulting in several new features designed to streamline and speed up the buying process, such as Fastlane. It has also implemented operational changes, including integrating the all-important pricing feature. The changes are already bearing fruits, given that the total payment volume increased by 7% year-over-year in Q4 2024. In 2024, PayPal Holdings Inc. (NASDAQ:PYPL) made $31.8 billion in net sales, a 7% increase from the previous year. This led to $4.2 billion in net income, a 2% decrease.
Monthly active users rose 2% to 223 million, while active accounts climbed 2% year over year to 434 million, affirming underlying growth. This is a change from numbers that had begun to fall, and it may be due to PayPal Holdings Inc.’s (NASDAQ:PYPL) new and enhanced features and products. A 5% year-over-year gain in Q4 earnings per share (EPS) reflects management’s efforts to improve efficiency.
8. Amazon.com, Inc. (NASDAQ:AMZN)
Bridgewater Associates Equity Stakes: $201.79 Million
Number of Hedge Fund Holders: 339
Amazon.com, Inc. (NASDAQ:AMZN) is a technology giant that offers an array of internet-based businesses, including e-commerce, cloud computing and digital streaming. It’s also investing in artificial intelligence features and services to strengthen its robust product portfolio. While the stock only gained 12% in 2024, it remains one of the best stocks to buy, according to billionaire Ray Dalio, owing to its growth prospects.
Amazon.com, Inc.’s (NASDAQ:AMZN) edge as one of the best stocks stems from the integration of artificial intelligence across its entire business line to drive efficiency and generate more revenue. The company is already using AI to forecast demand and optimize inventory in e-commerce. It also offers generative AI tools that help brands create cost-effective and efficient advertising campaigns across media types, drawing more advertising budgets.
As a market leader in cloud computing, it has already started designing custom chips to provide cheaper alternatives to Nvidia’s expensive GPUs for treating AI models. Amazon customers’ desire to test and deploy artificial intelligence (AI) applications is driving up demand for AWS. The wave of AI integration was the catalyst behind Amazon.com, Inc. (NASDAQ:AMZN) posting an 11% year-over-year revenue increase in 2024 to $638 billion. The revenue increase was mostly driven by robust advertising and cloud service sales growth.
7. Constellation Energy Corporation (NASDAQ:CEG)
Bridgewater Associates Equity Stakes: $211.68 Million
Number of Hedge Fund Holders: 85
Constellation Energy Corporation (NASDAQ:CEG) produces and sells energy products and services. It has approximately 31,676 megawatts of generating capacity consisting of nuclear, wind, solar, natural gas, and hydroelectric assets. It is another utility stock on a roll amid growing demand for energy to power data centers for the AI race.
Constellation Energy Corporation (NASDAQ:CEG) is the nation’s largest clean power producer, with its leading nuclear fleet and expanding renewable energy portfolio. Last year, the company announced plans to reopen the Three Mile Island and supply nuclear power to power Microsoft server farms. Because of its enormous need for lower-carbon energy, Microsoft will purchase all the power generated at a price far higher than that of other power sources. By 2028, that facility should be operational, giving Constellation Energy more room to boost its profits.
The expansion plan continued early in the year as the company confirmed plans to acquire natural gas and geothermal electric utility Calpine Corporation as it continues to strengthen its energy portfolio. Through 2028, Constellation Energy Corporation (NASDAQ:CEG) anticipates compound annual earnings per share growth of above 10%. After increasing its payout by 25% earlier this year, it also plans to raise its dividend by roughly 10% a year, affirming its commitment to returning value to shareholders.
6. Advanced Micro Devices, Inc. (NASDAQ:AMD)
Bridgewater Associates Equity Stakes: $217.14 Million
Number of Hedge Fund Holders: 96
Advanced Micro Devices, Inc. (NASDAQ:AMD) is a semiconductor company that designs and manufactures computer hardware components, including CPUs, GPUs, and other related technologies. Its products are used in gaming consoles, data centers, and embedded systems. The company supplies the best chips for various applications, including gaming and data centers.
While Advanced Micro Devices, Inc. (NASDAQ:AMD) always appears to play second fiddle to Nvidia, its competitive edge stems from offering powerful and advanced chips that are relatively cheap. The cost advantage is one of the reasons the company is increasingly catching up with Nvidia’s industry-leading GPUs.
The stock’s sentiments have received a significant boost amid news that its latest GPUs, the RX 9070 series, are selling well in Japan. The fact that the company is facing production constraints underscores strong demand. In addition to strong demand in Japan, AMD also boasts of big tech companies, including Microsoft, as clients for its M1300X GPUs, affirming another reliable revenue stream.
Strong demand for Advanced Micro Devices, Inc.’s (NASDAQ:AMD) chips for AI workloads was the catalyst behind a transformative 2024. The company’s data center revenue jumped 94% to a record $12.6 billion for the year, and 69% to a record $3.9 billion in the fourth quarter.
5. Vistra Corp. (NYSE:VST)
Bridgewater Associates Equity Stakes: $244.51 Million
Number of Hedge Fund Holders: 120
Vistra Corp. (NYSE:VST) is an integrated retail electricity and power generation company. It retails electricity and natural gas to residential, commercial, and industrial customers. It is also involved in electricity generation and wholesale energy purchases and sales. It was one of the best-performing stocks in Ray Dalio’s portfolio after rallying 102% in 2024.
The impressive run came amid growing expectations that Vistra Corp. (NYSE:VST) would be the biggest beneficiary of the growing demand for energy needed to power data centers amid the artificial intelligence revolution. That was evident as the company delivered better than expected fourth quarter and full year 2024 results as it benefited from rising demand for its nuclear power needed to power data centers.
Net income in the quarter totaled $490 million, a significant improvement from a net loss of 184 million in the same quarter in fiscal 2023. Full-year revenue increased by $4.04 billion to $17.22 billion. Amid the better-than-expected financial results, Vistra Corp also moved to strengthen its long-term prospects amid growing demand for power. It acquired three nuclear sites and secured about one million retail customers last year. Along with effectively expanding its retail division, Vistra Corp. (NYSE:VST) also successfully acquired Energy Harbor, adding nuclear, retail, and renewable assets to its portfolio.
4. Microsoft Corporation (NASDAQ:MSFT)
Bridgewater Associates Equity Stakes: $281.16 Million
Number of Hedge Fund Holders: 317
Microsoft Corporation (NASDAQ:MSFT) is a technology company that develops, licenses, and supports a wide range of software, services, and hardware. It also offers productivity software, cloud services, and gaming consoles. It is one of Bridgewater Associates’ most significant holdings as it increasingly capitalizes on the growing demand for generative artificial intelligence.
Microsoft Corporation’s (NASDAQ:MSFT) push into AI has accelerated because of its cooperation with OpenAI. Because of its dominance in enterprise cloud services and productivity software, the company is well-positioned to profitably commercialize AI across a wide range of clients. Likewise, it is seeing a significant increase in contract sizes and bookings due to the strong demand for its AI products. Microsoft Q2 2025 Earnings saw a 67% increase in commercial bookings, driven by “Azure commitments from OpenAI.” Compared to the 17% rise in commercial bookings during the same period the previous year.
Microsoft Corporation (NASDAQ:MSFT) came out with a healthy financial performance in the second quarter of its fiscal 2025. Revenue was up 12% year-over-year to $69.6 billion, and net income rose 10% to $24.1 billion. Its cloud computing unit, Azure, recorded a 19% year-over-year increase in revenue. Microsoft’s Azure cloud services got a boost of 13% points from the fast-growing demand for AI applications that the company has been offering on its platform.
3. Meta Platforms, Inc. (NASDAQ:META)
Bridgewater Associates Equity Stakes: $363.65 Million
Number of Hedge Fund Holders: 262
Meta Platforms, Inc. (NASDAQ:META) is a technology company focused on connecting people through social media platforms. It owns some of the biggest networking apps, including Facebook, Instagram, WhatsApp, and Oculus VR. It is one of Bridgewater Associates portfolios’ biggest holdings owing to its track record in delivering healthy gains. Over the past three years, the stock has delivered over 116% in gains compared to the 37% gain of the Nasdaq 100.
Every day, more than 3.3 billion individuals use one of Meta Platforms, Inc.’s (NASDAQ:META) social media apps. Similarly, the company is incorporating artificial intelligence features to improve and enhance user experience in its apps. Artificial intelligence (AI) capabilities significantly increase app engagement, enabling Meta Platforms to draw in more advertising budgets.
In 2024, Meta Platforms, Inc.’s (NASDAQ:META) total revenue reached a record $164.5 billion, a 22% rise over the previous year. The robust growth can be attributed in part to its efforts in the AI field, as it marked an increase from its growth rate of 16% in 2023.
2. NVIDIA Corporation (NASDAQ:NVDA)
Bridgewater Associates Equity Stakes: $469.66 Million
Number of Hedge Fund Holders: 223
NVIDIA Corporation (NASDAQ:NVDA) is a technology and computing infrastructure company that provides graphics, computing, and networking solutions. Its GPUs are in strong demand for powering data centers amid the artificial intelligence boom. It is one of the best stocks to buy, according to billionaire Ray Dalio, as the biggest beneficiary of increasing AI infrastructure spending.
With its graphics processing units (GPUs) serving as the foundation of AI infrastructure, NVIDIA Corporation (NASDAQ:NVDA) is the king of artificial intelligence (AI). Owing to strong demand for the company’s AI chips, revenue in the fourth quarter of fiscal 2025 reached $39.3 billion, up 78% year-over-year. Adjusted earnings also grew by an amazing 71% to $0.89 per share.
As it increases the supply of its most recent generation Blackwell processors to meet the rapidly increasing demand from customers, Nvidia may surpass its projections. More significantly, Blackwell’s adaptability can assist NVIDIA Corporation (NASDAQ:NVDA) in preserving its leading position in the AI chip industry. Likewise, earnings are anticipated to rise by 50% in the current fiscal year.
1. Alphabet Inc. (NASDAQ:GOOG)
Bridgewater Associates Equity Stakes: $685.51 Million
Number of Hedge Fund Holders: 234
Alphabet Inc. (NASDAQ:GOOG) is a technology giant that operates in diverse areas of internet services, cloud computing, healthcare, and autonomous vehicles. It generates a good chunk of its revenues from digital advertising. According to billionaire Ray Dalio, it is one of the best stocks to buy, as it owns two of the most valuable brands, Google and YouTube, that benefit from AI.
Because it runs the most popular search engine, Alphabet Inc. (NASDAQ:GOOG) is one of the top internet advertisers. It logged a 36% increase in net income to $100 billion in 2024 on $350 billion in revenue in 2024 thanks to the lucrative advertising business. Additionally, its cloud services reported a 30% year-over-year increase in revenue, having emerged as a key driver of underlying growth.
Alphabet Inc. (NASDAQ:GOOG) ended 2024 with a bolstered balance sheet with $96 billion in cash, cash equivalents, and short-term marketable securities. Consequently, it remains in a solid financial position to pursue strategic investments in AI and other areas capable of strengthening its product line and competitive edge. Additionally, it can make appropriate investments for growth, putting it in a position to weather economic storms, which is key to long-term stability.
While we acknowledge the potential of Alphabet Inc. (NASDAQ:GOOG) as an investment, our conviction lies in the belief that AI stocks hold greater promise for delivering higher returns and doing so within a shorter time frame. If you are looking for an AI stock that is more promising than GOOG but that trades at less than 5 times its earnings, check out our report about the cheapest AI stock.
READ NEXT: 20 Best AI Stocks To Buy Now and 30 Best Stocks to Buy Now According to Billionaires.
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