12 Best Fortune 500 Stocks To Buy According to Hedge Funds

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1. Amazon.com, Inc. (NASDAQ:AMZN)

Number of Hedge Fund Holders: 338

Topping our list of the Best Large Cap Stocks to Buy Now is Amazon.com, Inc. (NASDAQ:AMZN), an American multinational technology company that engages in e-commerce, cloud computing, online advertising, digital streaming, and artificial intelligence.

Amazon.com, Inc. (NASDAQ:AMZN) made headlines this month when it reported a massive revenue of $187.8 billion in Q4 2024, up 10% YoY. The company managed to pass Walmart in quarterly revenue for the first time ever, unseating the retailing giant from the top spot it has held for over a decade. Amazon’s core retail unit remains its biggest revenue generator, with the company reporting online sales growth of 7% YoY in Q4 to $75.56 billion. However, the company’s cloud unit reported a 19% rise in revenue to $28.79 billion, falling short of estimates of $28.87 billion. Though Amazon’s cloud services segment continues to be the fastest-growing and most profitable part of the business, investors have grown increasingly impatient with its multibillion-dollar capital spending and are hungry for higher returns from hefty investments in AI. For the full year 2024, Amazon’s revenue grew 11% to $638 billion, while operating income soared 86%, reaching $68.6 billion.

Amazon.com, Inc. (NASDAQ:AMZN) is expected to exceed $100 billion in capex for 2025, mainly directed toward AWS, its cloud unit. With a return on invested capital (ROIC) of 17% in 2024, up from 10.6% in 2023, the returns on these investments are expected to drive continued value creation.

Overall, Amazon.com, Inc. (NASDAQ:AMZN) ranks first on our list of the best Fortune 500 stocks to buy according to hedge funds. While we acknowledge the potential for AMZN to grow, our conviction lies in the belief that some AI stocks hold greater promise for delivering higher returns and doing so within a shorter time frame. If you are looking for an AI stock that is more promising than AMZN but that trades at less than 5 times its earnings, check out our report about the cheapest AI stock.

READ NEXT: 20 Best AI Stock To Buy Now and Complete List of 59 AI Companies Under $2 Billion in Market Cap

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