In this article, we will take a look at the 10 Best Stocks to Buy According to Billionaire Steve Cohen.
Steve Cohen, a prominent figure in the world of hedge funds, is the founder of Point72 Asset Management. The firm began managing external money in 2018 following a two-year supervisory restriction imposed by insider trading accusations against Cohen’s former firm, SAC Capital. That said, Cohen’s name isn’t just known within the world of finance. After years of having a small share in the New York Mets, he spent $2.4 billion to buy the franchise in 2020. Since then, his reputation as an obsessive businessman has evolved beyond finance to Major League Baseball.
Cohen stated that the future of the US economy moving forward is uncertain, in part due to President Donald Trump’s tariff proposal. Since Trump’s inauguration, economic policy seems to have shifted from threats of import taxes on countries such as Mexico and Canada to last-minute delays when conditions were agreed upon. Meanwhile, the White House seems to have moved forward with its tariff increase on several countries, potentially sparking a tug-of-war with some of the world’s largest economies. Speaking at the FIIPRIORITY conference in Miami back in February, Cohen said the following:
“I think this is one of those moments where there’s really a lot of uncertainty and I have pretty strong views here. … Tariffs cannot be positive, I mean it’s a tax. And you can imagine tit for tat if the U.S. does something — it implements a tax on somebody, somebody else is going to perhaps raise the stakes and raise their tax back. Taxes are never positive.”
“On top of that we have slowing immigration, which means the labour force will not grow as rapidly as… over the last five years,” he said. “And in addition now you have (the Department of Government Efficiency, DOGE). Wherever you lay on the DOGE issue that’s austerity, and austerity when that money’s been coursing through the economy over many years and now potentially will be reduced or stopped in many ways has got to be negative for the economy.”
Given the uncertain macroeconomic climate, the billionaire feels the stock market may see a pullback. He expects the US economy’s growth to slow to 1.5% from 2.5% in the second half of the year. The investor said he did not expect a “disaster,” but did expect a significant sell-off as market mood weakened, stating that this is “definitely a period where I think the best gains have been had, and it wouldn’t surprise me to see a significant correction.” Furthermore, Cohen is concerned that Elon Musk’s objective of utilizing DOGE to reduce government expenditure by $2 trillion may result in the largest employment cutbacks in US history. While economists do not anticipate job cuts alone to cause a recession since they are modest in comparison to the broader job market, they do have the ability to reduce GDP growth by a small amount.
Our Methodology
For this list, we sifted through Steve Cohen’s Q4 2024 portfolio, and narrowed down his firm’s top 10 holdings as of Q4 2024. Additionally, we have mentioned the hedge fund 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. Adobe Inc. (NASDAQ:ADBE)
Point72 Asset Management’s Q4 Stake: $333.08 million
Number of Hedge Fund Holders: 117
Adobe Inc. (NASDAQ:ADBE) is a world leader in software creation, known for its cutting-edge digital media solutions. Its major products, including Photoshop, Acrobat, and Adobe Creative Cloud, are essential tools for creative sectors and organizations throughout the world.
Adobe Inc. (NASDAQ:ADBE) posted better-than-expected first-quarter 2025 results, with adjusted earnings of $5.08 per share and revenue of $5.71 billion. This exceeded analysts’ expectations of $4.97 per share and $5.66 billion in revenue. The company’s annualized recurring revenue from AI contributed $125 million during the period, which Adobe Inc. (NASDAQ:ADBE) intends to double by the end of the fiscal year.
On March 21, Citi analyst Tyler Radke maintained a Neutral rating on Adobe Inc. (NASDAQ:ADBE), with a $430 price target. At the Adobe Summit, the analyst spoke with eight ecosystem partners on Adobe’s innovation speed, the industry’s desire for AI capabilities, and customer IT expenditure patterns. The company’s partners recognized Adobe’s leadership in digital content production and management. However, they stated that implementing new solutions such as GenStudio or Firefly Services may be sluggish, owing to numerous companies still shifting to the cloud.
Guinness Global Innovators stated the following regarding Adobe Inc. (NASDAQ:ADBE) in its Q4 2024 investor letter:
“Adobe Inc. (NASDAQ:ADBE) faced challenges this year, ending as the Fund’s worst-performing stock (-25.5% USD). Investor concerns about Adobe’s AI strategy and underwhelming earnings reports played a key role in performance over the year. Adobe started the year with optimism surrounding its generative AI innovations and the company seemed poised to capitalize on the surging demand for creative and marketing automation tools. Its AI-driven platform, Firefly, launched in March 2023, quickly gained traction, generating over 16 billion creative outputs and setting adoption records. However, despite this strength, Adobe’s stock has underperformed, as earnings reports over the year have appeared softer than initially expected from investors. The market reaction however was not caused by scepticism about Adobe’s AI products and tools, but rather driven by concerns on the ability to monetise these quickly. The creative design market has seen intensifying competition with competitors like OpenAI, Canva and even startups introducing generative AI content tools such as text-to-video tools. Adobe’s strategy has appeared to be focused on prioritising widespread adoption over immediate monetization, echoing its successful strategy with PDF in previous years. While larger enterprises have adopted and appreciate Adobe’s ‘commercially safe’ tools compared to peers, Adobe sees a large opportunity amongst those that were not traditionally users of the Adobe’s tools, whether enterprise employees or non-enterprise customers and have thus chosen to drive proliferation of their tools in these ‘untapped’ consumers and delay monetisation. Whilst some AI tools have missed revenue expectations through the year, the increased proliferation and the increasing costs of creating content should improve Adobe’s prospects of monetisation into FY25. Further, despite these short-term challenges, Adobe has a track record of high-quality attributes and long-term growth prospects. Its extensive distribution network, and loyal customer base provide it with a durable competitive edge. The company’s subscription-based model, which accounts for over 90% of its revenue, ensures stable cash flows and high margins. Finally, its brand equity as the industry standard in creative and document solutions supports ongoing market leadership, allowing us to remain confident in Adobe’s ability to navigate current challenges and deliver sustained value over time.”
9. Arista Networks Inc. (NYSE:ANET)
Point72 Asset Management’s Q4 Stake: $333.9 million
Number of Hedge Fund Holders: 78
Arista Networks, Inc. (NYSE:ANET) is an American computer networking company based in Santa Clara, California. The company focuses on inventing and delivering multilayer network switches that enable software-defined networking in large-scale data centers, cloud computing, high-performance computing, and high-frequency trading settings.
On March 18, Evercore ISI maintained its Outperform rating and $130 price target for Arista Networks Inc. (NYSE:ANET), despite the recent revelation of a high-profile CEO resignation. The firm’s analysts reacted to the departure of John McCool, Chief Platform Officer and SVP of Engineering and Operations, who will step down on April 7, 2025, but will remain a senior advisor to the CEO. According to Evercore ISI, this is the third high-profile CEO to quit Arista in the previous 18 months, which may add to the gloomy view of the company. However, the firm highlighted that the departure did not change their favorable opinion of Arista.
Giverny Capital Asset Management stated the following regarding Arista Networks Inc (NYSE:ANET) in its Q4 2024 investor letter:
“I trimmed Arista Networks Inc (NYSE:ANET) as it grew beyond 10% weight in the portfolio thanks to its continued outperformance. Arista has been on a tear in January and if our clients are lucky I will leave Arista alone for a while! The market appears to see that Artificial Intelligence data centers are going to require robust investment in networking equipment, and Arista is the leader in that sector.”
8. The Walt Disney Company (NYSE:DIS)
Point72 Asset Management’s Q4 Stake: $345.19 million
Number of Hedge Fund Holders: 108
The Walt Disney Company (NYSE:DIS), founded in 1923, is a well-known media and entertainment giant that produces and distributes a wide range of material, including movies, television series, and animated films. In addition, the company is well-known for its world-class theme parks.
On March 12, JPMorgan reaffirmed its Overweight rating on The Walt Disney Company (NYSE:DIS), with a $130 price target. The firm’s report highlighted Disney’s Parks & Experiences division’s contribution to the company’s sales and operational profits. According to JPMorgan, this area is likely to continue being the primary contributor to Disney’s financial results, even as the Direct-to-Consumer (DTC) sector grows.
The Walt Disney Company (NYSE:DIS) recently released first-quarter profits for 2025, beating expectations with earnings per share of $1.76, compared to the prediction of $1.45. The company’s revenues of $24.7 billion also met expectations, exhibiting strong performance led by growth in its DTC sector and blockbuster box office releases.
Meridian Hedged Equity Fund stated the following regarding The Walt Disney Company (NYSE:DIS) in its Q2 2024 investor letter:
“The Walt Disney Company (NYSE:DIS) operates a diversified entertainment business with theme parks, media networks, and streaming services. We own Disney because we believe its strong brand, valuable IP, and expanding streaming offerings will drive sustainable long-term growth. The company’s stock, however, underperformed in the quarter due to concerns about a slowdown in growth at its theme park division. While park revenue still grew by 10% year-over-year, management’s commentary suggested a moderation in post-pandemic demand and rising costs, leading to a disappointing outlook for park operating income in the second half of the year. This overshadowed the positive news that the company’s streaming segment, driven by strong subscriber growth at Disney+, reached profitability ahead of schedule. We held our position and will continue to monitor the performance of the theme park division.”
7. Intuit Inc. (NASDAQ:INTU)
Point72 Asset Management’s Q4 Stake: $346.16 million
Number of Hedge Fund Holders: 89
Intuit Inc. (NASDAQ:INTU) is a global financial technology platform that enables both individuals and organizations to achieve their financial goals. Its products include Mailchimp for email marketing, QuickBooks for company accounting, Credit Karma for financial management, and TurboTax for tax preparation.
On March 12, Mizuho Securities reaffirmed its Outperform rating on Intuit Inc. (NASDAQ:INTU), with a price target of $765. This follows a series of investor meetings with Intuit’s CEO, Sasan Goodarzi. The strategic importance of Intuit’s AI-powered expert platform was noted during these meetings, particularly for consumer and corporate applications. Mizuho’s study also predicts that Intuit’s tax-related efforts are likely to be successful this year, especially in the consumer market. These include focused marketing for assisted services, increasing local expert presence in search results, and focusing on capturing the lower-end market.
Intuit Inc. (NASDAQ:INTU) maintained a bullish estimate for fiscal year 2025, with revenues expected to range between $18.16 billion and $18.35 billion, reflecting a 12-13% rise. Operating income is forecast to increase by 28% to 30%, while diluted earnings per share are expected to expand by 13-14%.
Parnassus Growth Equity Fund stated the following regarding Intuit Inc. (NASDAQ:INTU) in its Q3 2024 investor letter:
“Intuit Inc. (NASDAQ:INTU) shares fell despite the financial software company posting strong quarterly results. The company’s pricing-dependent long-term guidance concerned investors. However, we continue to believe Intuit’s customer growth and relevant platform will sustain its wide moat and long growth runway.”
6. AT&T Inc (NYSE:T)
Point72 Asset Management’s Q4 Stake: $355.46 million
Number of Hedge Fund Holders: 80
AT&T Inc. (NYSE:T), the world’s largest telecommunications business and the leading supplier of mobile phone services in the United States, is a multinational conglomerate holding corporation headquartered in Texas that offers telecommunications, media, and technology services.
In Q4, AT&T Inc. (NYSE:T) generated $32.3 billion in revenues and $0.56 per share in earnings. The telecommunications giant earned $11.9 billion in cash from operations, including $6.8 billion in capital expenditures and $7.1 billion in total investment. Free cash flow also hit the $4.8 billion mark.
On March 25, Goldman Sachs confirmed its Buy recommendation for AT&T Inc. (NYSE:T), with a $29 price target. The firm’s analyst indicated increasing confidence in the company’s prospects, predicting that the stock value may climb to around $40 over time. This would mean a 50% increase from current levels, implying strong annualized returns. This view is influenced by the company’s distinct market share gains in the telecoms industry, its detachment from the trending “AI theme,” and its defensive business strategy.
5. The Coca-Cola Company (NYSE:KO)
Point72 Asset Management’s Q4 Stake: $360.57 million
Number of Hedge Fund Holders: 81
The Coca-Cola Company (NYSE:KO), best known for its iconic Coca-Cola brand, is a beverage company that produces over 200 brands, including sodas, waters, coffees, teas, juices, kombuchas, and alcoholic drinks. The firm has 28% of the global market value in its non-alcoholic, ready-to-drink beverage categories, giving it a strong market position.
On February 20, The Coca-Cola Company (NYSE:KO) boosted its quarterly dividend for the 63rd consecutive year. This increase brings the annual dividend to $2.04 per share, up from $1.94 last year.
On February 11, Citi analyst Filippo Falorni reiterated his Buy rating and $85 price target for The Coca-Cola Company (NYSE:KO). Falorni’s decision comes after the company’s Q4 2024 performance and predicted profitability in 2025. Since pricing was 9% higher than projected the projected 5.9%, the company’s organic sales growth was 14% higher than the consensus of 7%.
4. Taiwan Semiconductor Manufacturing Company Limited (NYSE:TSM)
Point72 Asset Management’s Q4 Stake: $492.7 million
Number of Hedge Fund Holders: 186
Taiwan Semiconductor Manufacturing Company Limited (NYSE:TSM) is a leading Taiwanese corporation that provides semiconductor manufacturing services. It is one of the world’s largest specialized independent semiconductor foundries, manufacturing integrated circuits for a variety of customers.
Taiwan Semiconductor Manufacturing Company Limited (NYSE:TSMC) reported an 11% decrease in February revenue month over month, but a significant gain of 43% year-over-year, reaching NT$260 billion.
On March 17, Bernstein analysts maintained their Outperform rating and a $251 price target for Taiwan Semiconductor Manufacturing Company Limited (NYSE:TSM) shares. The firm’s study centered on the probable effects of TSMC’s $165 billion investment in US manufacturing capabilities. Bernstein’s analysis investigates the level of regional diversity, semiconductor manufacturing self-sufficiency in the United States, and the potential impact on TSMC’s profit margins from this investment. Furthermore, the firm believes that TSMC’s investment would result in 25-30% of the company’s total income being generated in the United States by early 2030s.
Parnassus Growth Equity Fund stated the following regarding Taiwan Semiconductor Manufacturing Company Limited (NYSE:TSM) in its Q4 2024 investor letter:
“Taiwan Semiconductor Manufacturing Company Limited’s (NYSE:TSM) leading position in AI chip production continued to boost investor sentiment on the stock. During the year, moves by several large technology companies to increase their AI investments underscored demand for TSMC’s chips and supported the stock’s rise.”
3. NVIDIA Corporation (NASDAQ:NVDA)
Point72 Asset Management’s Q4 Stake: $562.5 million
Number of Hedge Fund Holders: 223
NVIDIA Corporation (NASDAQ:NVDA) is a global leader in the design and sale of Graphics Processing Units (GPUs), a market that has expanded dramatically in response to rising demand for artificial intelligence models. Despite rising competition in the IT industry, NVIDIA remains a Wall Street favorite.
On March 21, UBS analyst Timothy Arcuri reiterated a Buy rating on NVIDIA Corporation (NASDAQ:NVDA), with a $185 price target. The endorsement came after the conclusion of the Global Technology Conference (GTC), during which NVIDIA’s Sovereign AI Summit included experts from both the public and commercial sectors from across the world addressing the future of artificial intelligence infrastructure. The analyst also stated that, while certain AI infrastructure initiatives are in collaboration with significant U.S. cloud service providers (CSPs), the majority of spending is independent of CSP capital expenditures, which are frequently used to estimate AI infrastructure demand.
Manole Capital Management stated the following regarding NVIDIA Corporation (NASDAQ:NVDA) in its Q3 2024 investor letter:
“As of this publication, Nvidia is up roughly 150% year-to-date. NVIDIA Corporation (NASDAQ:NVDA) was the largest gainer in the S&P 500 last year and has more than tripled in value over the last year. It hit an eye-opening market capitalization of $3 trillion in June, less than four months after it eclipsed the $2 trillion mark. Enthusiasm for everything AI-related, especially for the primary chip maker whose products are essential to powering AI technology, continues to fuel the market. Last quarter, and for the fifth consecutive quarter, Nvidia reported sales and profits that blew past Wall Street expectations. The stock rose +37% in the second quarter alone.”
2. Microsoft Corporation (NASDAQ:MSFT)
Point72 Asset Management’s Q4 Stake: $713.79 million
Number of Hedge Fund Holders: 317
Microsoft Corporation (NASDAQ:MSFT) is a major technology firm recognized for its core software products, which include the Windows operating system, the Microsoft 365 suite, and the Edge browser. Its offerings include business software, software development tools, video games, gaming equipment, and cloud services.
Microsoft Corporation (NASDAQ:MSFT) increased revenues by 12% yearly to $69.6 billion for the fiscal second quarter of fiscal 2025, while net income increased by 10% to $24.1 billion. The company’s cloud segment is rapidly playing a key role in driving growth, with revenues from the intelligent cloud sector jumping 21% to $40.9 billion.
On January 30, RBC Capital Markets reiterated its Outperform rating for the MSFT stock, with a $500 price target. The firm recently announced its software industry estimate for 2025, and it chose Microsoft Corporation (NASDAQ:MSFT) for its broad market exposure and ability to profit from generative AI.
1. Amazon.com, Inc. (NASDAQ:AMZN)
Point72 Asset Management’s Q4 Stake: $917.68 million
Number of Hedge Fund Holders: 339
Amazon.com, Inc. (NASDAQ:AMZN) is a prominent technology company that runs the world’s largest e-commerce and cloud computing businesses. The company also offers digital streaming and artificial intelligence technology. Amazon.com, Inc.’s (NASDAQ:AMZN) e-commerce position affords it a significant competitive advantage over competitors, accounting for around 38% of total e-commerce sales in the United States.
Amazon.com, Inc. (NASDAQ:AMZN) revealed impressive results for the year 2024, with net sales up 11% year-over-year to $638.0 billion. Net sales for the fourth quarter rose by 10% to $187.8 billion, while net income nearly doubled to $59.2 billion from $30.4 billion in 2023.
On February 16, TD Cowen analyst John Blackledge reiterated his Buy rating on the AMZN stock and set a price target of $265. One of the reasons for Blackledge’s sentiments is AWS’s expected growth in generative AI income. The analyst predicts growth from $2.8 billion in 2024 to $56.3 billion by 2030. Blackledge also lauded Anthropic’s contribution to AWS’s GenAI revenue stream, which was projected to account for half of total GenAI revenue by 2024.
Ariel Appreciation Fund stated the following regarding Amazon.com, Inc. (NASDAQ:AMZN) in its Q4 2024 investor letter:
“During the quarter, we initiated three new investments, each in companies we have followed closely for a considerable time. At various points, we viewed them as missed opportunities; however, our experience with Mr. Market has taught us that patience often creates inevitable entry points. This quarter, some exciting opportunities presented themselves. The three investments are Amazon.com, Inc. (NASDAQ:AMZN), Diageo (NYSE: DEO), and Uber (NASDAQ: UBER). We will discuss each in detail below.
While we acknowledge the potential for AMZN as an investment, our conviction lies in the belief that some AI stocks hold greater promise for delivering higher returns and doing so within a shorter time frame. There is an AI stock that went up since the beginning of 2025, while popular AI stocks lost around 25%. If you are looking for an AI stock that is more promising than AMZN but 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.
Disclosure: None. Insider Monkey focuses on uncovering the best investment ideas of hedge funds and insiders. Please subscribe to our free daily e-newsletter to get the latest investment ideas from hedge funds’ investor letters by entering your email address below.
