In this article, we will discuss the 11 best Fast Money stocks to buy now according to hedge funds. If you want to explore similar stocks, you can also take a look at 5 Best Fast Money Stocks To Buy According To Hedge Funds.
“Trendlines Over Headlines”
On April 12 Piper Sandler’s chief market technician, Craig Johnson, appeared in an interview on CNBC where he discussed the current market situation and his market outlook. According to Johnson, the market is going to undergo 3 phases: “a hop, and drop, and a pop”, and right now we are in a “hop” phase. According to Johnson, the S&P 500 has the potential to trade up to anywhere between 4,200 and 4,300 during the “hop” phase. As for the “drop” phase, Johnson expects the market to decline when the Fed decides to cut interest rates, which he expects will happen in the middle of 2023 or possibly in the third quarter of 2023.
Craig Johnson noted that “great downturn reversals have already occurred” over the past 24 months on the Dow, the S&P 500, the NASDAQ, the Russell 2000, and the Dow Jones Transportation Average as well. According to Craig Johnson, we have had “a series of higher highs and higher lows” and when we look at the lows that were made in September and October 2022, we observe that at that point in time the market was extremely oversold. Here are some comments from Craig Johnson:
“If you come back and you look at history, all the way back to 1929, when you look at the fact that we haven’t seen in the first quarter (of 2023) a break back below the December lows of last year (2022). That has historically been a pretty bullish sign for the market. In fact, when you look back in time, the market is typically 83% of the time higher, with about 13.7% annual return, when you don’t break back below those December lows in the first quarter of the new year. And that’s exactly what we are seeing happen this year.”
While the markets may undergo a correction, according to Craig Johnson, investors should focus on the long term for 2023. Craig Johnson expects the S&P 500 to move up to 4,625 by the end of the year. Here is what Craig Johnson of Piper Sandler said:
“If you look at some of the underlying indices, clearly, it is trendlines over headlines at this point in time… All the negativity out there at this point in time, stocks aren’t going down. They’re starting to trend higher and we really need to pay attention to that fact.”
Craig Johnson thinks that the National Bureau of Economic Research will officially declare a recession in the back half of 2023. He noted that once a recession is official, “history shows that you typically backdate that recession’s start date by about 7.6 months”. Out of all the recessions since 1929, it was only in 2002 that the market did not bottom, said Johnson, and he thinks that after the market bottoms the S&P 500 will “pop” back to 4,625.
Craig Johnson further noted that he sees the Fed starting to cut interest rates in July 2023, or possibly after that, and this will lead to a “quick drop” in the markets. Craig Johnson talked about investor positioning right now and said:
“We’re at levels right now that we have seen only at the lows of the market in 2020, 2011, and 2007. The world is already very negatively positioned, and any drop will get bought from our perspective.”
While Craig Johnson’s market outlook offers valuable insights into the broader market, investors can also consider the individual stocks recommended by Fast Money traders to identify potential near-term opportunities. Fast Money is a popular TV show on CNBC that offers daily stock picks and market insights from a group of experienced traders. However, these traders provide valuable insights into individual stocks and sectors that are likely to outperform in the short term. For investors with a long-term time horizon, looking at Fast Money stocks that are also popular among elite hedge funds can be a systematic way to position their portfolios, while avoiding losses in the short-term. Some of the best Fast Money stocks to buy now according to hedge funds include Tesla, Inc. (NASDAQ:TSLA), UnitedHealth Group Inc. (NYSE:UNH), and Microsoft Corporation (NASDAQ:MSFT). Let’s now discuss these stocks, among others, in detail below.
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Our Methodology
We watched all Fast Money episodes from April 1 to April 12 and compiled a list of stocks that were pitched by Fast Money traders as their final trades for the day. We the sourced each stock’s hedge fund sentiment from Insider Monkey’s database of roughly 900 elite hedge funds and narrowed down our selection to stocks that were the most widely held by institutional investors. We have ranked these stocks in ascending order of the number of hedge funds that have stakes in them.
11 Best Fast Money Stocks To Buy According To Hedge Funds
11. Delta Air Lines, Inc. (NYSE:DAL)
Number of Hedge Fund Holders: 51
Delta Air Lines, Inc. (NYSE:DAL) was one of Timothy Seymour’s final trades this April. Timothy Seymour is the CIO and managing partner of Seymour Asset Management and is also a Fast Money trader. On April 3, Raymond James raised its price target on Delta Air Lines, Inc. (NYSE:DAL) to $54 from $53 and maintained a Strong Buy rating on the shares.
Shares of Delta Air Lines, Inc. (NYSE:DAL) have gained 11.06% over the past 6 months, as of April 12, and the stock is trading at a PE multiple of 16x.
Delta Air Lines, Inc. (NYSE:DAL) is one of the best Fast Money stocks to buy now according to hedge funds. At the end of Q4 2022, 51 hedge funds were long Delta Air Lines, Inc. (NYSE:DAL) and disclosed stakes worth $1.65 billion in the company. Of those, Citadel Investment Group was the leading investor in the company and disclosed a position worth $234 million.
Some stocks that Fast Money is talking about that are also popular among smart money investors include Tesla, Inc. (NASDAQ:TSLA), UnitedHealth Group Inc. (NYSE:UNH), and Microsoft Corporation (NASDAQ:MSFT).
10. Raytheon Technologies Corporation (NYSE:RTX)
Number of Hedge Fund Holders: 51
Raytheon Technologies Corporation (NYSE:RTX) was a part of 51 investors’ portfolios at the end of Q4 2022. These funds held collective positions worth $1.81 billion in the company. As of December 31, Balyasny Asset Management is the top investor in the company and has a position worth $229 million.
Raytheon Technologies Corporation (NYSE:RTX) was Guy Adami’s final trade this April. Guy Adami is an American trader and professional investor and is also one of the notable traders on Fast Money. As of April 12, the stock has surged 19.62% over the past 6 months and is offering a forward dividend yield of 2.21%.
On April 12, Wolfe Research upgraded Raytheon Technologies Corporation (NYSE:RTX) to Outperform from Peer Perform, with a $117 price target. The stock is placed tenth on our list of the best Fast Money stocks to buy now according to hedge funds.
9. Lockheed Martin Corporation (NYSE:LMT)
Number of Hedge Fund Holders: 53
Another one of Guy Adami’s stock picks from the defense sector is Lockheed Martin Corporation (NYSE:LMT). As of January 25, Argus analyst John Eade has a Buy rating and a $500 price target on Lockheed Martin Corporation (NYSE:LMT).
Lockheed Martin Corporation (NYSE:LMT) has returned 20.23% to investors over the past 6 months and is offering a forward dividend yield of 2.46%, as of April 12. Lockheed Martin Corporation (NYSE:LMT) is placed ninth on our list of the best Fast Money stocks to buy now.
53 hedge funds disclosed having stakes in Lockheed Martin Corporation (NYSE:LMT) at the end of Q4 2022. The total value of these stakes amounted to $2.13 billion. As of December 31, GQG Partners is the largest shareholder in the company and has a position worth $559 million.
8. Amgen, Inc. (NASDAQ:AMGN)
Number of Hedge Fund Holders: 60
On March 13, Wells Fargo analyst Mohit Bansal upgraded Amgen, Inc. (NASDAQ:AMGN) to Overweight from Equal Weight and revised his price target on the stock to $265 from $275. Amgen, Inc. (NASDAQ:AMGN) is one of the best Fast Money stocks to buy now.
Amgen, Inc. (NASDAQ:AMGN) was one of Guy Adami’s final trades this April. He noted that the stock has rebounded from $225 twice over the past year and called it “epic”. As of April 12, the stock is offering a forward dividend yield of 3.40%.
At the close of the fourth quarter of 2022, 60 hedge funds were eager on Amgen, Inc. (NASDAQ:AMGN) and held collective positions worth $2.2 billion in the company. Of those, Two Sigma Advisors was the largest stockholder in Amgen, Inc. (NASDAQ:AMGN) and disclosed a stake worth $403 million.
In addition to Amgen, Inc. (NASDAQ:AMGN), other Fast Money stocks that are widely held by elite hedge funds include Tesla, Inc. (NASDAQ:TSLA), UnitedHealth Group Inc. (NYSE:UNH), and Microsoft Corporation (NASDAQ:MSFT).
7. Starbucks Corporation (NASDAQ:SBUX)
Number of Hedge Fund Holders: 61
Starbucks Corporation (NASDAQ:SBUX) was spotted on 61 investors’ portfolios at the end of Q4 2022. These funds disclosed collective stakes worth $2.65 billion in the company. As of December 31, Bridgewater Associates is the most prominent shareholder in the company and has a position worth $259 million.
Timothy Seymour likes Starbucks Corporation (NASDAQ:SBUX) and said that he is “long the stock” and he thinks the company is “rich”. The Fast Money trader mentioned it as one of his final trades this April. Starbucks Corporation (NASDAQ:SBUX) has a trailing twelve-month free cash flow of over $2 billion and is offering a forward dividend yield of 2.02%, as of April 12.
On February 15, BMO Capital analyst Andrew Strelzik raised his price target on Starbucks Corporation (NASDAQ:SBUX) to $125 from $120 and maintained an Outperform rating on the shares. Starbucks Corporation (NASDAQ:SBUX) is ranked seventh among the best Fast Money stocks to buy now.
Polen Capital made the following comment about Starbucks Corporation (NASDAQ:SBUX) in its Q4 2022 investor letter:
“We also liquidated our remaining position in Starbucks Corporation (NASDAQ:SBUX). While the company remains a unique and resilient franchise, China is a very important growth market for the company, and zero-COVID policies have made it challenging for the company to operate in this important market. While we expect China to return to more “normal” operation at some point, any COVID flare-ups, in China or other markets, present a very real headwind to Starbucks’ profitability. L’Oreal, Estée Lauder, and other holdings continue to have meaningful exposure to China, but in each of these cases, our research indicates they’re able to better adapt to these operating challenges and realize the growth opportunity in China through their online businesses. In short, we think there are better risk-reward opportunities.”
6. Occidental Petroleum Corporation (NYSE:OXY)
Number of Hedge Fund Holders: 71
Fast Money’s Courtney Garcia picked Occidental Petroleum Corporation (NYSE:OXY) as one of her final trades this April. Courtney Garcia currently serves as the senior wealth advisor at Payne Capital Management and is also a Fast Money trader. Courtney Garcia noted that though energy has underperformed the markets lately, “fundamentals continue to look strong” and Occidental Petroleum Corporation (NYSE:OXY) “is a good way of playing this”.
Shares of Occidental Petroleum Corporation (NYSE:OXY) have gained 8.76% over the past 12 months and the stock is trading at a TTM PE ratio of 5.23. The stock is one of the best Fast Money stocks to buy now according to hedge funds.
On April 11, Truist analyst Neal Dingmann raised his price target on Occidental Petroleum Corporation (NYSE:OXY) to $86 from $84 and maintained a Buy rating on the shares.
Occidental Petroleum Corporation (NYSE:OXY) was a part of 71 investors’ portfolios at the close of Q4 2022 that held collective positions worth $16.6 billion in the company. Of those, Berkshire Hathaway was the top investor in the company and disclosed a stake worth $12 billion.
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Disclosure: None. 11 Best Fast Money Stocks To Buy According To Hedge Funds is originally published on Insider Monkey.
