In this article, we discuss 10 strong buy stocks to invest in now according to Reddit. If you want to see more stocks in this selection, click 5 Strong Buy Stocks to Invest in Now According to Reddit.
The first half of 2022 was decidedly one of the worst on record in terms of corporate performance and deteriorating macroeconomic environment. However, retail investors have been strengthening their long positions as an upcoming recession threatens a downturn in US equities yet again. For the three months ending May, retail investors purchased stocks worth $76 billion. The market turbulence did not stop novice traders from loading up on growth and tech equities when the S&P 500 benchmark came close to announcing a bear territory.
In March, retail investors poured a net $28 billion into tech-heavy US securities, which is the largest monthly investment since Vanda Research began tracking retail activity in 2014. In April, May, and June, retail traders put $25 billion a month on average in the stock market, up drastically from the pre-pandemic levels, where monthly average stock market activity came in at $3 billion in 2019. The market selloff, paired with rampant inflation and rising rates, has battered growth stocks and significant market players are now trading at large discounts.
Reddit is an internet platform where retail investors often share their trades, discuss possible portfolio positions, celebrate their stock market triumphs, and bemoan their trade losses. Reddit forums are abuzz with potential stock market plays that the retail investors are extremely fond of, as these companies seem to be trading at attractive valuations and the beaten down stock prices create solid buying opportunities. Some of the strong buy stocks to invest in now according to Reddit include Alphabet Inc. (NASDAQ:GOOG), The Walt Disney Company (NYSE:DIS), and Intel Corporation (NASDAQ:INTC).
Photo by Chris Liverani on Unsplash
Our Methodology
We used the r/Stocks subreddit for our research for this article, selecting the most prominent and commonly purchased stocks by the community members. These stocks have strong growth prospects for the future and also received positive ratings from market analysts recently.
Strong Buy Stocks to Invest in Now According to Reddit
10. AMN Healthcare Services, Inc. (NYSE:AMN)
Number of Hedge Fund Holders: 25
AMN Healthcare Services, Inc. (NYSE:AMN) was founded in 1985 and is based in Dallas, Texas. The company offers healthcare staffing services to hospitals and healthcare facilities in the United States, operating through three segments – Nurse and Allied Solutions, Physician and Leadership Solutions, and Technology and Workforce Solutions. AMN Healthcare Services, Inc. (NYSE:AMN) announced a $250 million share repurchase program in mid-June and the company more than doubled its revenue in Q4 2021 amid the pandemic-related staffing shortages.
According to Redditors, the labor situation in the United States is bleak and more people are moving away from the healthcare sector. Since it takes extensive training to become a healthcare professional, the healthcare staffing companies who can recruit and deploy the most workforce will grow and print money rapidly in the future. While HCA has recently pointed towards easing labor pressures in the healthcare space, Redditors believe that healthcare professionals, specially at-home staff or nurses, will be too expensive to hire and the labor market will once again be pressurized, paving the way for AMN Healthcare Services, Inc. (NYSE:AMN).
According to Insider Monkey’s data, 25 hedge funds were bullish on AMN Healthcare Services, Inc. (NYSE:AMN) at the end of the first quarter of 2022, compared to 28 funds in the prior quarter. Billionaire Israel Englander’s Millennium Management is the leading position holder in the company, with 890,147 shares worth about $93 million.
In addition to Alphabet Inc. (NASDAQ:GOOG), The Walt Disney Company (NYSE:DIS), and Intel Corporation (NASDAQ:INTC), Redditors are lately bullish on AMN Healthcare Services, Inc. (NYSE:AMN).
Polen Capital Management mentioned AMN Healthcare Services, Inc. (NYSE:AMN) in its Q3 2020 investor letter. Here is what the firm said:
“AMN Healthcare Services also contributed during the quarter. As a leading provider of healthcare workforce solutions and staffing services in the U.S., the business has experienced substantial dislocation because of COVID-19. Still, the company has adapted, adding services like telehealth and audio/video interpretation services, and deepened and expanded its relationships. While demand for its services remains depressed, order flows are beginning to resume. Over the long-term, we believe its competitive position along with secular tailwinds should continue to drive demand for the company’s services and solutions.”
9. GFL Environmental Inc. (NYSE:GFL)
Number of Hedge Fund Holders: 27
GFL Environmental Inc. (NYSE:GFL) operates as a diversified environmental services company in Canada and the United States. The company specializes in non-hazardous solid waste management, infrastructure and soil remediation, and liquid waste management services. It is headquartered in Vaughan, Canada. On July 27, GFL Environmental Inc. (NYSE:GFL) reported Q2 2022 earnings per share of $0.19 and a revenue of $1.33 billion, above Street consensus by $0.04 and $116.97 million, respectively.
Redditors observed that GFL Environmental Inc. (NYSE:GFL)’s main strategy is to grow by acquisition and one day they will own a big share of the waste management market. The Reddit investors called GFL Environmental Inc. (NYSE:GFL) a gold mine, since everyone makes waste and companies will mine plastics and metals from these dumps, and use methane for natural gas production as well. This will give greater revenue streams to GFL Environmental Inc. (NYSE:GFL) in the future.
Among the hedge funds tracked by Insider Monkey, GFL Environmental Inc. (NYSE:GFL) was part of 27 public stock portfolios at the end of Q1 2022, compared to 30 funds in the earlier quarter. Robert Pohly’s Samlyn Capital is the leading stakeholder of the company, with 4.16 million shares worth $135.6 million.
8. United States Steel Corporation (NYSE:X)
Number of Hedge Fund Holders: 37
United States Steel Corporation (NYSE:X) is a Pennsylvania-based company that manufactures and sells flat-rolled and tubular steel products in North America and Europe. The company declared on July 28 a $0.05 per share quarterly dividend, which is payable on September 8 to shareholders of record as of August 8. United States Steel Corporation (NYSE:X) posted a Q2 EPS of $3.86, in-line with estimates. The revenue of $6.29 billion gained 25.17% year over year and exceeded market consensus by $468.84 million. The company also announced a $500 million repurchase authorization. With a price to earnings ratio of just 1.36, Redditors are interested in United States Steel Corporation (NYSE:X)’s attractive valuation relative to earnings potential and its steady dividend payment.
On July 6, Morgan Stanley analyst Carlos De Alba maintained an Equal Weight rating on United States Steel Corporation (NYSE:X) and lowered the price target on the stock to $20 from $27. Steel prices have dropped swiftly from their March highs and he is marking-to-market his steel and scrap price forecasts for 2022 and 2023, and reducing estimates and price targets across his Americas Steel coverage, the analyst told investors.
Among the hedge funds tracked by Insider Monkey, United States Steel Corporation (NYSE:X) was part of 37 funds in the first quarter of 2022, compared to 39 funds in the earlier quarter. Eric W. Mandelblatt’s Soroban Capital Partners is the biggest position holder in the company, with 11.6 million shares valued at roughly $441 million.
7. Academy Sports and Outdoors, Inc. (NASDAQ:ASO)
Number of Hedge Fund Holders: 40
Academy Sports and Outdoors, Inc. (NASDAQ:ASO) is a Texas-based retailer of sporting goods and outdoor recreational products. Redditors were bullish on Academy Sports and Outdoors, Inc. (NASDAQ:ASO) as the stock has gained about 17% in the last year and its financials are solid. Some Redditors said that they had loaded up on Academy Sports and Outdoors, Inc. (NASDAQ:ASO) when it was trading in the $30 range, and they wish they had purchased more of the stock back then. The Reddit community claimed that they preferred Academy Sports and Outdoors, Inc. (NASDAQ:ASO) over other sporting goods companies including DICK’S Sporting Goods, Inc. (NYSE:DKS) and Hibbett, Inc. (NASDAQ:HIBB).
On June 8, Stephens analyst Daniel Imbro raised the price target on Academy Sports and Outdoors, Inc. (NASDAQ:ASO) to $72 from $70 and reiterated an Overweight rating on the shares after the company reported “another strong quarter” and gave better-than-expected margin guidance that he sees as “evidence of the self-help initiatives management has discussed since the IPO”. The quarterly results boost his confidence that Academy Sports and Outdoors, Inc. (NASDAQ:ASO) is maintaining share gains and he believes the present valuation remains largely discounted given the quality of the business.
According to Insider Monkey’s data, 40 hedge funds were long Academy Sports and Outdoors, Inc. (NASDAQ:ASO) at the end of March 2022, compared to 47 funds in the earlier quarter. Shellback Capital is a notable stakeholder of the company, with 1.20 million shares worth $47.2 million.
6. Walmart Inc. (NYSE:WMT)
Number of Hedge Fund Holders: 60
Walmart Inc. (NYSE:WMT) is an American retailer that operates through three segments – Walmart U.S., Walmart International, and Sam’s Club. Redditors believe that Walmart Inc. (NYSE:WMT) stock is always a buy, and provides great value especially at the current prices. The discounted price, paired with the valuation and scale of operations, makes Walmart Inc. (NYSE:WMT) an attractive stock for many Redditors.
On July 27, Deutsche Bank analyst Krisztina Katai reiterated a Buy rating on Walmart Inc. (NYSE:WMT) but lowered the price target on the shares to $142 from $166. The company reassured investors about their biggest concern coming out of the Q1 earnings season, confirming that it did not slash its guidance due to internal factors such as the surplus discretionary inventory. Walmart Inc. (NYSE:WMT)’s guidance update actually indicates a larger softening within the retail space, especially among the low to middle-income consumers who are increasingly pressured by soaring inflation and the outrageous gas prices, the analyst told investors in a research note.
Among the hedge funds tracked by Insider Monkey, Rajiv Jain’s GQG Partners is the leading stakeholder of Walmart Inc. (NYSE:WMT), with 15.4 million shares worth about $2.3 billion. Overall, 60 hedge funds were bullish on Walmart Inc. (NYSE:WMT) at the end of Q1 2022, compared to 63 funds in the prior quarter.
Like Alphabet Inc. (NASDAQ:GOOG), The Walt Disney Company (NYSE:DIS), and Intel Corporation (NASDAQ:INTC), retail investors are piling into Walmart Inc. (NYSE:WMT).
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Disclosure: None. 10 Strong Buy Stocks to Invest in Now According to Reddit is originally published on Insider Monkey.
