In this article, we will take a look at the 11 Best Gig Economy Stocks to Buy According to Hedge Funds.
During the COVID-19 pandemic, the gig economy stocks experienced one of the most profitable periods. As remote work opportunities increased, individuals and freelancers took advantage of the growing gig economy trend. However, post-pandemic the gig economy stocks came back to their normal trend. Still, the remote culture got a massive push that continues to grow and support most of the gig economy companies today.
Also Read: Jim Cramer Discusses These 11 Stocks & President Trump’s Sovereign Wealth Fund
According to the report from ResearchAndMarkets, the global market for freelance platforms is expected to reach $13.8 billion by 2030, growing from $4.8 billion in 2023. Whereas, research from Payoneer shows that the U.S. and the U.K. are two of the top destinations for freelancers, with diverse markets offering a range of opportunities for freelancers. Brazil, Pakistan, Ukraine, and the Philippines are also top locations with large and highly skilled workforces that support the global freelance market.
Asia remains one of the fast-growing freelance markets backed by India, Bangladesh, Pakistan, Ukraine, and the Philippines, with a large pool of talented workers and a burgeoning tech industry. Russia and Serbia are also experiencing a surge in freelancers, with more businesses looking for freelance contractors.
The North American market remains the highest-paid market for remote or freelance work. The average hourly rate in North America is around $44, while Western Europe follows next with an average per-hour rate of $31. Freelancers in Asia earn around $22 per hour on average, as per the report.
The growing freelance market and remote work are driving the gig economy and it can be a great time to invest in gig economy stocks. With that, let’s take a look at the 11 Best Gig Economy Stocks to Buy According to Hedge Funds.
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Our Methodology
We shifted through ETFs and online rankings to compile a list of gig economy stocks. We have selected the 11 gig economy stocks to buy with the highest number of hedge fund holders, as of Q3 2024. The stocks are ranked in ascending order based on hedge fund sentiment.
Why do we care about what hedge funds do? 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 275% since May 2014, beating its benchmark by 150 percentage points (see more details here).
11 Best Gig Economy Stocks to Buy According to Hedge Funds
11. Upwork Inc. (NASDAQ:UPWK)
No. of Hedge Fund Holders: 24
Upwork Inc. (NASDAQ:UPWK) is a communication services company that operates a global freelancing platform, connecting various businesses with individuals and agencies. With the gig economy continuing to expand, the company is well-positioned to benefit from this structural shift in the labour market. Upwork reportedly holds the largest market share in the global freelance market.
On January 6, Jefferies analyst Brent Thill upgraded the price target on UPWK shares from $19 to $20, maintaining a Buy rating on the stock. The analyst shared thoughts on Upwork, stating that a seasonally challenging Q1 leads the firm to believe in a more cautious, selective approach heading into 2025. However, Thill expects the company to accelerate in the second half of 2025, driven by more contributions from AI and as “positive revisions on conservative guidance come through.”
In Q3 2024, Upwork Inc. (NASDAQ:UPWK) posted record net income and a 193% rise in FCF, driven by its one-off billing schedule and cost-reduction initiatives. The company is also focusing on driving the audience towards its newly launched Business Plus membership, targeting to attract more consistent client spending. The company is expected to generate between $756 million and $761 million in revenues for the full year 2024, up by nearly 9.7% or 10.4% year-over-year.
10. Payoneer Global Inc. (NASDAQ:PAYO)
No. of Hedge Fund Holders: 30
Payoneer Global Inc. (NASDAQ:PAYO) is a financial technology company that allows SMBs to make transactions and do business globally. The company has penetrated global markets, particularly in emerging markets, to meet the demand for online payments. The company has built its market around SMBs and manages their cross-border and other needs from a single platform. Payoneer supports over 100 banking and payment service providers internationally.
On February 3, Deutsche Bank analyst Nate Svensson initiated coverage on PAYO shares with a Buy rating and a price target of $13 per share. The analyst initiated the rating on the stock highlighting the company’s strong positioning in cross-border fintech services for SMBs. Payoneer operates in over 190 countries and serves more than 2 million active customers, which allows the firm to benefit from key fintech trends. Svensson stated that the firm has the potential to accelerate core revenue growth beyond 2025. The analyst also cited risks including the company’s exposure to macro-sensitive micro-SMBs in emerging markets.
On the back of strong performance in the third quarter of 2024, Payoneer Global Inc. (NASDAQ:PAYO) increased the full-year 2024 guidance for revenue and adjusted EBITDA by $30 million. In Q3, the company posted a record-breaking quarter in both volume and revenue, with total volume soaring for a seventh consecutive quarter to 25%. The company’s B2B volume increased by 57% during the quarter, adding to Payoneer’s overall growth and revenue.
