In this article, we will take a look at the 10 Best Stocks to Buy According to John W. Rogers of Ariel Investments.
John W. Rogers Jr. is a prominent American investor and hedge fund manager who serves as the chairman, CEO, and CIO of Ariel Investments. Rogers graduated from Princeton University in 1980 and spent two and a half years as a stock broker at William Blair. Three years later, he founded Ariel Investments, the first Black-owned mutual fund company in the United States, with $200,000 supported by family and friends. Howard University would be Ariel Investments’ initial customer, with the firm receiving $100,000 to manage its endowment. The next year, the city of Chicago granted Ariel $1 million to operate a pension plan. By 2009, Ariel Investments was managing $3.3 billion in assets, which has since increased to a staggering $12.9 billion.
Notably, the investor’s flagship Ariel Fund’s faced one of its first hurdles back on October 19, 1987, the day of the crash known as Black Monday. The next major test came after the dot-com crisis in 2000, with the Ariel Fund rebounding strongly, returning 29% that year and 14% in 2001. During the 2008 financial crisis, Rogers’ investments in equities, such as real estate investment firm CBRE Group and newspaper publisher Gannett, caused the fund to lose 48% before returning 63% in 2009.
Rogers appreciates patience as he looks for companies that he believes will reach their full potential in a set period of years. This strategy of scooping up value stocks, pioneered by famed investors Warren Buffett and Benjamin Graham, involves buying stocks whose worth may be undervalued by the market. Speaking on a Bloomberg Invest Conference, the investor stated that market enthusiasts might get overly focused on short-term trends, and those prepared to look three or five years ahead may still uncover opportunities.
Ariel Investments remains steadfast in its belief of value investing, even within the current market climate. This confidence in its strategy was reaffirmed in the fund’s Q1 2025 Investor Letter. Here is what Ariel Fund had to say:
Most major U.S. indices ended the first quarter of 2025 in the red, with investors fleeing to safety as optimism for another year of U.S. outperformance driven by economic momentum and the new administration’s pro-business stance was quickly replaced by tariff fears and policy uncertainty. The Magnificent Seven, which drove most of the markets gains over the last three years, led the decline, falling nearly -15%. Value bested growth and large caps held up better than their small cap brethren. International equity markets, led by Europe and China, surged—delivering their strongest quarterly outperformance versus the U.S. in 15 years. Meanwhile, deteriorating confidence and apprehension about a global trade war is fueling recession fears. While Wall Street sits on edge and markets remain erratic, we are actively leaning into the volatility by judiciously acquiring the downtrodden shares of quality companies whose value should be realized over the long term.
John Rogers of Ariel Investments
Our Methodology
For this list, we picked stocks from Ariel Investments’ 13F portfolio as of the end of the fourth quarter of 2024. These equities are also popular among elite hedge funds.
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. Boyd Gaming Corporation (NYSE:BYD)
Ariel Investments’ Stake as of Q4: $231.1 million
Number of Hedge Fund Holders: 40
Boyd Gaming Corporation (NYSE:BYD) is a leading casino entertainment operator in the United States. The company runs 28 establishments in 10 states, including casinos, hotels, and entertainment venues, catering to both local and regional markets. Boyd Gaming Corporation (NYSE:BYD) is also expanding its standing in online sports betting and iGaming through collaborations with FanDuel and other platforms.
On April 25, Mizuho Securities indicated confidence in Boyd Gaming Corporation (NYSE:BYD), with analyst Ben Chaiken raising the price target to $86 from $83, retaining an Outperform rating on the company’s shares. The revision comes after Boyd Gaming’s recent financial performance, which exceeded analysts’ forecasts in numerous key parameters. Boyd Gaming Corporation (NYSE:BYD) reported total property EBITDA of $361.3 million, which exceeded Mizuho’s expectation of $349.4 million and the Street’s forecast of $352.4 million. Boyd’s other segments also performed well, with the Locals segment generating $106.5 million, which was close to the Street’s projection of $106.7 million, while the Downtown section reported $20.9 million, higher than both Mizuho’s forecast of $17.8 million and the Street’s $17.9 million. Chaiken also stated that Boyd Gaming’s business trends in April remained stable, in contrast to some of the industry’s broader outlooks.
9. Sphere Entertainment Co. (NYSE:SPHR)
Ariel Investments’ Stake as of Q4: $231.6 million
Number of Hedge Fund Holders: 58
Sphere Entertainment Co. (NYSE:SPHR) is an American entertainment business that produces and hosts live events. It primarily operates in two areas: Sphere and MSG Networks.
On April 9, Guggenheim analysts maintained a Buy rating on Sphere Entertainment Co. (NYSE:SPHR), with a price target of $69. The firm’s analysts upgraded their model for SPHR, predicting a more profitable second half of the year. The expected rise in profitability stems from three important factors, which include the debut of a new Sphere Experience show, the anticipated timing of new sponsorship deals, and ongoing efforts to enhance SG&A cost reductions.
Sphere Entertainment Co. (NYSE:SPHR)’s fourth quarter results came in mixed, with revenue crossing expectations at $308.3 million, compared to a prediction of $289.41 million, despite a 1.9% year-over-year fall. However, the company posted a larger-than-expected loss of -$3.49 per share, compared to analysts’ projections of -$2.37 per share. Sphere Entertainment’s Las Vegas venue experienced a 1% rise in revenue to $169 million, although it had an adjusted operating loss of $0.8 million, compared to the prior year’s adjusted operating income of $14.1 million. Meanwhile, the MSG Networks segment’s revenue fell 5% to $139.3 million, owing to an 11.5% loss in total subscribers.
