In this article, we will take a look at the 10 best stocks to buy today. You can skip our detailed analysis of the major growth catalysts for these companies and go directly to the 5 Best Stocks to Buy Today.
During the pandemic, major blue-chip companies demonstrated resilience in the face of market disruption. Despite the market shock, large-cap stocks provided investors with consistent growth. For instance, the biggest ETFs that track the US large-cap market outperformed amid the pandemic-led recession in which the SPDR S&P 500 ETF (NYSEARCA:SPY) gained 39.2% over the last year, while the Vanguard Total Stock Market ETF (NYSEARCA:VTI) gained 40.4%.
Some of the top-performing stocks included in the Vanguard Total Stock Market ETF (NYSEARCA:VTI) holdings are Apple Inc. (NASDAQ:AAPL), Amazon.com, Inc. (NASDAQ:AMZN), Tesla, Inc. (NASDAQ:TSLA), and Microsoft Corporation (NASDAQ:MSFT). These growth stocks have shown massive returns and business growth in the previous year.
Photo by Marga Santoso on Unsplash
Our Methodology
To give you the list of the best stocks to buy today, we sifted the top-performing stocks in Vanguard Total Stock Market ETF (NYSEARCA:VTI) that have long-term growth catalysts and positive analyst ratings.
These are some of the most popular stocks among the 873 hedge funds tracked by Insider Monkey. We ranked the large-cap companies based on the number of hedge funds that owned a stake in each firm as of the second quarter.
Why pay attention to hedge fund holdings? Insider Monkey’s research was able to identify in advance a select group of hedge fund holdings that outperformed the S&P 500 ETFs by more than 86 percentage points since March 2017. Between March 2017 and July 2021, our monthly newsletter’s stock picks returned 186.1%, vs. 100.1% for the SPY. Our stock picks outperformed the market by more than 86 percentage points (see the details here). That’s why we believe hedge fund sentiment is an extremely useful indicator that investors should pay attention to. You can subscribe to our free newsletter on our homepage to receive our stories in your inbox.
Best Stocks To Buy Today
10. Chevron Corporation (NYSE:CVX)
Number of Hedge Fund Holders: 50
We start the list of 10 best stocks to buy today with oil giant Chevron Corporation (NYSE:CVX). The California-based energy company is a popular long-term stock among investors not only because it has petroleum operations all over the world, but also because it is a consistent dividend-paying stock that increased its payout for more than three decades. The company currently pays an annual dividend of $5.36 per share and offers a dividend yield of 4.89%.
Berkshire Hathaway, led by legendary investor and billionaire Warren Buffett, is the largest shareholder in Chevron Corporation (NYSE:CVX) as of Q2, with 23.1 million shares valued at $2.42 billion. At the end of June 2021, 50 of the 873 elite funds tracked by Insider Monkey reported owning shares in the oil behemoth.
On October 7, Truist analyst Neal Dingmann kept a Buy rating on Chevron Corporation (NYSE:CVX) and raised his price target for the stock to $150 from $145. The stock gained 30%, year to date.
9. NextEra Energy, Inc. (NYSE:NEE)
Number of Hedge Fund Holders: 59
In 2020, investors poured in approximately $500 billion in the renewable energy sector alongside electric vehicles, and American utility giant NextEra Energy, Inc. (NYSE:NEE) is one of the clean energy companies that benefited from it. Billionaire and investor David Shaw of D E Shaw increased his stake in the Florida-based renewable energy company by 92%.
NextEra Energy, Inc. (NYSE:NEE), which ranks ninth on the list of 10 best stocks to buy today, is a major player in the growing renewable energy sector serving over 5.6 million customers in North America. The company operates nearly 40 major solar power plants in the US through its FPL segment. Additionally, the company is one of the leading generators of sun and wind energies in North America. In 2020, NextEra Energy, Inc. (NYSE:NEE) operated 3,148 megawatts of universal-scale solar energy and 16,000 MW of wind energy in the U.S.
Another factor that attracts investors to NextEra Energy, Inc. (NYSE:NEE) is the company’s streak of 26 consecutive annual dividend increases.
8. Tesla, Inc. (NASDAQ:TSLA)
Number of Hedge Fund Holders: 60
Even though Tesla, Inc. (NASDAQ:TSLA) saw a decline in the number of hedge funds having stakes in the company in the second quarter, the electric vehicle maker remains one of the most popular automotive stocks among institutional investors. At the end of June, 60 funds out of the 873 tracked by Insider Monkey had stakes in the company, compared to 62 in the previous quarter.
At the beginning of the third quarter of 2021, Tesla, Inc. (NASDAQ:TSLA) held 21% of the market share for global electric vehicles sales. The California-based EV behemoth delivered 241,300 vehicles in the third quarter, far exceeding analysts’ expectations of 220,900. Shares of Tesla, Inc. (NASDAQ:TSLA) soared more than 19%, year to date.
On October 15, the EV stock jumped 3% after Jefferies raised its price target for Tesla, Inc. (NASDAQ:TSLA) to $950 from $850 with a Buy rating. Jefferies analyst Philippe Houchois believes that the soon-to-be-launched Berlin Gigafactory would provide a higher EV manufacturing and delivery capacity for Telsa, Inc.
The American EV manufacturer, which ranks eighth on the list of 10 best stocks to buy today, continues to dominate China’s passenger car market. Tesla, Inc. (NASDAQ:TSLA) captured a roughly 15% market share in EV sales in September, with 357,000 EVs sold in China. For the first three quarters of 2021, Tesla, Inc.’s (NASDAQ:TSLA) Model Y and Model 3 are among the 15 best-selling electric vehicles in China, trailing only General Motors’ Hongguang Mini.
In the Q3 2021 investor letter of Worm Capital LLC, the management firm mentioned Tesla, Inc. (NASDAQ: TSLA) and discussed its stance on the firm. Here is what the fund said:
“Our core portfolio as of this writing—TSLA, SPOT, SHOP, ABNB, and AMZN—are all premier examples of companies that use the concept of aggregation of marginal gains to continuously improve their value proposition for customers. After all, what is innovation if not just a continuous search for fractional advantages in business?
The way we see it, Tesla is perhaps the generational example of the marginal gain aggregation theory. It’s also been our largest position for several years now. There are many ways to characterize and value this business (see previous letters for long-form write-ups), but perhaps the best way to think about the company is that it is a highly vertically integrated software and hardware firm that’s devoted entirely to aggregating marginal gains across its organization. The goal? Lower costs, improve thruputs and dramatically enhance the value proposition—at scale—for consumers…” (Click here to see the full text)
7. Walmart Inc. (NYSE:WMT)
Number of Hedge Fund Holders: 71
Walmart Inc. (NYSE:WMT) has turned to e-commerce and grown to be one of the biggest players in the online shopping space as a result of the huge number of buyers who shifted to online shopping during the pandemic. In the second quarter of 2021, the supermarket giant’s e-commerce sales in the United States increased by 6% year over year, while the company’s global e-commerce sales are on pace to finish $75 billion by the end of the year. The company’s total revenue in the second quarter grew by 2.4% from a year earlier to $141.05 billion.
Walmart Inc. (NYSE:WMT), which ranks seventh on the list of 10 best stocks to buy today, continues to expand its retail and e-commerce market share and as a result, more investors are watching the retailer stock. Multi-billionaire and investor Ken Fisher of Fisher Asset Management is the biggest stakeholder of the Arkansas-based retail giant as of the second quarter, with a $1.78 billion stake. On October 18, Goldman Sachs analyst Kate McShane upgraded Walmart Inc. (NYSE:WMT) to Conviction Buy from Buy and raised her price target for the stock to $196 from $184.
Overall, 71 funds of the 873 elite funds tracked by Insider Monkey reported owning stakes in Walmart Inc. (NYSE:WMT) at the end of June 2021, up from 58 in the preceding quarter.
Just like Apple Inc. (NASDAQ:AAPL), Amazon.com, Inc. (NASDAQ:AMZN), Tesla, Inc. (NASDAQ:TSLA), and Microsoft Corporation (NASDAQ:MSFT), Walmart Inc. (NYSE:WMT) is one of the best stocks to buy today for long-term investment, according to market analysts.
6. NVIDIA Corporation (NASDAQ:NVDA)
Number of Hedge Fund Holders: 86
Ranking sixth on the list of 10 best stocks to buy today is NVIDIA Corporation (NASDAQ:NVDA), one of the top tech companies profiting from the growing gaming market globally, which is anticipated to reach $314 billion by 2026. Shares of the chipmaker have soared more than 67% year to date.
The California-based GPU manufacturer is currently in the process of acquiring the British semiconductor technology provider Arm Ltd. The $40 billion mega-deal was announced in September 2020 and is expected to be completed by the end of 2022. If the American chipmaker successfully acquires Arm Ltd., NVIDIA Corporation (NASDAQ:NVDA) will gain market share for global smartphone chips and enterprise servers. The stock gained 65.5% in the past twelve months.
On October 5, Keybank analyst John Vinh maintained an Overweight rating on NVIDIA Corporation (NASDAQ:NVDA) and increased his price target for the stock to $260 from $245. In addition, the number of hedge funds with stakes in NVIDIA Corporation (NASDAQ:NVDA) increased to 86 in the second quarter, up from 80 in Q1.
In the Q2 2021 investor letter of Harding Loevner, the fund mentioned NVIDIA Corporation (NASDAQ:NVDA) and discussed its stance on the firm. Here is what the fund said:
“Within IT, shares of US-based computer chip developer NVIDIA continued their climb as rising demand across segments-from work-from-home laptops to data centers to cryptocurrency mining rigs-led to shortages that translated into surging prices for its chips. Such was the windfall that NVIDIA even made technical changes to some of its products to make them towards what it believes are more sustainable uses. Less attractive to cryptocurrency miners, to steer scarce supply viewed by geography, the lion’s share of excess returns came from good stock performance in the US. In addition to the contributions from NVIDIA and our health care holdings, a pair of IT software and service providers also aided relative returns.”
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Disclosure: None. 10 Best Stocks to Buy Today is originally published on Insider Monkey.
