In this article we will take a look at the 16 best beginner stocks to invest in right now. You can skip our detailed analysis of these stocks, and go directly to 5 Best Beginner Stocks to Invest in Right Now. Note that all hedge fund data is based on the exclusive group of 800+ funds tracked by Insider Monkey as part of our market-beating investment strategy.
The coronavirus pandemic caused a major economic clampdown globally. In the initial days of the virus, S&P 500 and The Dow reported their worst fall since 2011. The global economy is still recovering from the after-effects but the recurrent waves of the virus are creating chaos. Recently, the inflation in the UK reached 2.1%, surpassing the Bank of England’s target. A report published by the Federal Reserve Bank of New York in May 2020 stated that the U.S. companies stood at a loss of $1.7 trillion in their value due to the tariffs imposed against China. This volatility has forced an average American to turn to investing and passive income streams to diversify their revenue and income sources.
In this article we will mention some of the best and safest stocks to buy for beginner investors. Investing your money in stocks offers one of the best ways to increase your wealth. To see examples of that you don’t have to go back far into the history.
Cloudflare, Inc. (NYSE: NET) went public in 2019 and was traded at $15 per share. The stock price of this network security company has now soared by 423% since its IPO. The company also has a solid customer base globally with countries outside of the U.S. accounting for 48% of its revenue. Another software company, Palantir Technologies Inc. (NYSE: PLTR) is gaining the attention of investors. The stock price has grown by 167.8% since its initial public offering IPO in September 2020, when it was priced at $7.25 per share.
Companies offering digital payments also tend to gain investors’ attention. Palantir Technologies Inc. (NYSE: PLTR) made the headlines when it announced the acceptance of payments in Bitcoin. Another financial services company, Square, Inc. (NYSE: SQ) supports payments in cryptocurrency. The crypto investments in Square, Inc. (NYSE: SQ) account for nearly $400 million. Similarly, earlier in March 2021, Visa Inc. (NYSE: V) announced its partnership with Hong Kong-based cryptocurrency platform, Crypto.com, allowing the customers to convert the cryptocurrency into fiat currency. This could be a good step for Visa Inc. (NYSE: V) considering Crypto.com has over 10 million users.
In the technology sector, smartphone manufacturer Apple Inc. (NASDAQ: AAPL) remains the top choice of investors due to its continuous growth over the years. According to the report published by CounterPoint Research, Apple Inc. (NASDAQ: AAPL) accounted for 55% of smartphone shipments in the U.S. in the first quarter of 2021.
The pandemic-driven changing global trends have also affected the work industry. According to a report by Upwork Inc. (NASDAQ: UPWK), 36% of Americans worked freelance in 2020 and contributed $1.2 trillion to the national economy. This rise brought Upwork Inc. (NASDAQ: UPWK) in the eyes of the investors, making it one of the best beginner stocks to invest in right now. Upwork Inc. (NASDAQ: UPWK) stock price also benefitted from the situation at hand, surging by 130% since its IPO in 2018.
Photo by Jason Briscoe on Unsplash
But beginner investors should practice extreme caution as investing is becoming difficult by the day, even for the smart money. The entire hedge fund industry is feeling the reverberations of the changing financial landscape. Its reputation has been tarnished in the last decade, during which its hedged returns couldn’t keep up with the unhedged returns of the market indices. On the other hand, 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 124 percentage points since March 2017. Between March 2017 and February 26th 2021 our monthly newsletter’s stock picks returned 197.2%, vs. 72.4% for the SPY. Our stock picks outperformed the market by more than 124 percentage points (see the details here). We were also able to identify in advance a select group of hedge fund holdings that significantly underperformed the market. We have been tracking and sharing the list of these stocks since February 2017 and they lost 13% through November 16th. 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.
Let’s analyze the 16 best beginner stocks to invest in right now. We took into account analysts’ ratings, fundamentals, future growth potential and hedge fund sentiment while choosing these stocks.
Best Beginner Stocks to Invest in Right Now
16. Linde plc (NYSE: LIN)
Number of Hedge Fund Holders: 43
Linde plc (NYSE: LIN) is a Dublin-based chemical and gas company. It is one of the best beginner stocks to invest in right now due to its recent investments in hydrogen power, a focus of the Joe Biden administration.
In Q1 2021, Linde plc (NYSE: LIN) generated over $7.2 billion in revenues, up from $6.7 billion during the same period last year. The share price of LIN stock has grown by 37.8% in the past year, after hitting a low of $151 in March 2020. Linde plc (NYSE: LIN) has received a price target of $330 from Morgan Stanley, raised from $285, on May 10, 2021.
At the end of Q1 2021, 43 hedge funds, tracked by Insider Monkey hold positions in Linde plc (NYSE: LIN), worth $4.6 billion.
15. Palantir Technologies Inc. (NYSE: PLTR)
Number of Hedge Fund Holders: 32
An American software company, Palantir Technologies Inc. (NYSE: PLTR) is next on our list of the best beginner stocks to invest in right now.
In Q1 2021, Palantir Technologies Inc. (NYSE: PLTR) generated a revenue of over $341 million, up from $229 million during the same period last year. The PLTR share price has grown by 164% in the past year. Recently, Palantir Technologies Inc. (NYSE: PLTR) has come under an $18.4 million contract with Federal Aviation Administration FAA to manage the safety activities in the agency.
Of the 866 hedge funds in our database, 32 funds hold stakes in Palantir Technologies Inc. (NYSE: PLTR) as of the end of the first quarter, worth $1.1 billion.
Like Bristol-Myers Squibb Company (NYSE: BMY), MGM Resorts International (NYSE: MGM), Cloudflare, Inc. (NYSE: NET), and BP p.l.c. (NYSE: BP), Palantir Technologies Inc. (NYSE: PLTR) is one of the best beginner stocks to invest in right now.
14. Sea Limited (NYSE: SE)
Number of Hedge Fund Holders: 98
A Singaporean internet company, Sea Limited (NYSE: SE) is ninth on our list of the best beginner stocks to invest in right now. It is one of the largest companies with a market cap of $144 billion. In Q1 2021, Sea Limited (NYSE: SE) generated over $1.7 billion in revenues, surging 147% year-over-year.
Sea Limited’s (NYSE: SE) e-commerce and gaming arms, Shopee and Garena, are growing at a rapid pace, benefiting the SE stock. Due to this growth of Shopee, BofA raised the price target for Sea Limited’s (NYSE: SE) from $260 to $340, rating the stock as a ‘Buy’ on June 10, 2021. The SE stock price has surged by 157% in the past year and 38.7% in the past six months.
Like Palantir Technologies Inc. (NYSE: PLTR), BP p.l.c. (NYSE: BP), Uber Technologies, Inc. (NYSE: UBER), General Motors Company (NYSE: GM), MGM Resorts International (NYSE: MGM), Bristol-Myers Squibb Company (NYSE: BMY), Chevron Corporation (NYSE: CVX), and Linde plc (NYSE: LIN), Sea Limited (NYSE: SE) is one of the best beginner stocks to invest in right now.
At the end of Q1 2021, 98 hedge funds tracked by Insider Monkey hold positions in Sea Limited (NYSE: SE), worth $10.4 billion.
Clearbridge Investments published its Q1 2021 investment letter and mentioned Sea Limited (NYSE: SE) along with other stocks. Here is what the firm has to say:
“Singapore-based Sea maintains leading positions in Southeast Asia in video games and e-commerce and operates an emerging digital payments and banking business. While the company is investing heavily into e-commerce and payments, this growth is being funded by its highly profitable gaming segment. We see a long runway for growth across Sea’s businesses with multiple opportunities like e-commerce expansion in Latin America not fully factored into the valuation today. The company also has a well-respected management team that has successfully executed in expanding its total addressable market. Along with existing holding Alibaba, Sea provides exposure to secular growth trends in emerging markets that are harder to replicate through U.S. stocks.”
13. BP p.l.c. (NYSE: BP)
Number of Hedge Fund Holders: 29
BP p.l.c. (NYSE: BP) is a British energy company with productions in oil and gas. The Q1 2021 report of BP p.l.c. (NYSE: BP) shows a profit of $4.7 billion, up from $1.4 billion the quarter earlier.
The BP stock has been on the rise after suffering the oil prices crash in the previous year. The share prices have surged by 26% in the past six months and by 32% year to date. Earlier in April 2021, the board of BP p.l.c. (NYSE: BP) announced a quarterly dividend of $0.05 per share.
As of Q1 2021, 29 hedge funds tracked in our database hold positions in BP p.l.c. (NYSE: BP), worth $1.24 billion.
Like Visa Inc. (NYSE: V), Square, Inc. (NYSE: SQ), and Apple Inc. (NASDAQ: AAPL), BP p.l.c. (NYSE: BP) is one of the beginner stocks to invest in right now.
12. Uber Technologies, Inc. (NYSE: UBER)
Number of Hedge Fund Holders: 130
Uber Technologies, Inc. (NYSE: UBER) is eighth on our list of the best beginner stocks to invest in right now.
The Q1 2021 revenue of Uber Technologies, Inc. (NYSE: UBER) stood at over $2.9 billion or $0.57 per share. In the past year, the UBER stock price has grown by 46.8% and 17.6% since its IPO in 2019. Uber Technologies, Inc. (NYSE: UBER) has announced to buy the remaining shares of a grocery company, Cornershop, acquiring 100% of the business.
Altimeter Capital Management remains the biggest shareholder in the company with over 28 million shares. At the end of Q1 2021, 135 hedge funds tracked in our database hold positions in Uber Technologies, Inc. (NYSE: UBER), worth $10.5 billion.
RiverPark Advisors, LLC published its Q4 2020 investor letter and highlighted Uber Technologies, Inc. (NYSE: UBER), along with other stocks in it. Here is what the fund has to say:
“UBER was also a strong contributor, as shares rallied following the approval of California’s Proposition 22 by voters, allowing the company’s California-based drivers to remain independent contractors (rather than become more expensive employees). We believe this news is not just about the 10%-15% of Uber Technologies, Inc. (NYSE: UBER)’s revenue tied to California, but the influence this will have on other states reassessing driver pay. UBER also reported strong third quarter results with Delivery Gross Bookings growing 135% year-over-year which nearly fully offset a reduction in Mobility Gross Bookings, which were down 50% year over year. Total Gross Bookings for the quarter were down only 10% year over year as compared with down 35% last quarter.
Despite the COVID disruption, Uber Technologies, Inc. (NYSE: UBER) remains the undisputed global leader in ride sharing (44% of the Company’s third quarter revenue), with greater than 50% share in every major region in which it operates. The company is also a leader in food delivery (46% of revenue), where it is number one or two in the more than 25 countries in which it operates. We view UBER as more than just ride sharing and food delivery, but also as a global mobility platform with the ability to sell to its more than 100 million users (by comparison, Amazon Prime has 130+ million members) and penetrate new markets of on-demand services, such as grocery delivery, truck brokerage and worker staffing for shift work. At its current $96 billion market capitalization, UBER trades at only 6x next year’s revenue from its two core businesses. Additionally, the company has substantial, seemingly unrecognized, value in its several nascent development businesses and another $12 billion in equity stakes in synergistic businesses around the world.”
11. General Motors Company (NYSE: GM)
Number of Hedge Fund Holders: 86
General Motors Company (NYSE: GM) is an American producer and distributor of vehicles and related products. It is one of the best beginner stocks to invest in right now because the number of EV buyers is expected to grow in the coming years.
In Q1 2021, the revenue of General Motors Company (NYSE: GM) stood at over $32.4 billion. The GM stock has also performed well this year. Currently traded at $60 per share, the stock price has grown by 49.2% year to date and 122% in the past year. Morgan Stanley recently said it would not be “surprised” if General Motor (NYSE:GM) raised full-year guidance by as much as $1 per share or even more. The firm’s analyst Adam Jonas has an Overweight rating on the stock with a price target of $80.
As of Q1 2021, hedge funds are turning bullish on General Motors Company (NYSE: GM), as the number of hedge fund holders has increased from 70 to 86, with stakes worth over $8 billion.
10. Chevron Corporation (NYSE: CVX)
Number of Hedge Fund Holders: 41
Chevron Corporation (NYSE: CVX) is an American energy company and stands seventh on our list of the best beginner stocks to invest in right now. In Q1 2021, the company reported a revenue of $31 billion, up from $29.7 billion during the same period last year. Chevron Corporation (NYSE: CVX) has recently partnered with Toyota Motor Corporation (NYSE: TTM) to develop hydrogen-powered vehicles.
The CVX stock has shown consistent growth over the years, with share price soaring by 19.8% in the past year. It is one of the best beginner stocks to invest in right now because of its long period of increasing annual dividends. The board of Chevron Corporation (NYSE: CVX) announced a 4% increase in its quarterly dividend to $1.34 per share, earlier in April.
As of Q1 2021, 41 hedge funds tracked by Insider Monkey hold positions in Chevron Corporation (NYSE: CVX), worth $4.8 billion.
Like Apple Inc. (NASDAQ: AAPL), Cloudflare, Inc. (NYSE: NET), and Nutrien Ltd. (NYSE: NTR), Chevron Corporation (NYSE: CVX) is one of the best beginner stocks to invest in right now.
ClearBridge Investments published its first-quarter 2021 investor letter and mentioned Chevron Corporation (NYSE: CVX). Here is what the investment management firm has to say:
“While reducing in health care and consumer staples, we increased our exposure to high-quality names in economically sensitive areas of the market. We added to low-cost, high-quality energy names, (including) Chevron. We are positive on the company’s strong balance sheets, competitive positions and exposure to an economic recovery.”
9. Nutrien Ltd. (NYSE: NTR)
Number of Hedge Fund Holders: 33
Nutrien Ltd. (NYSE: NTR) is a Canadian fertilizer company and a global leading producer of potash and nitrogen. The Q1 2021 revenues of the company stand at $4.6 billion, up from $4.1 billion during the same period last year.
With a significant rise in crop prices, Nutrien Ltd. (NYSE: NTR) becomes one of the best beginner stocks to invest in right now. The stock price has soared by over 50% in the past year and 18.5% year to date. Recently, Morgan Stanley has increased the price target of the NTR stock from $62 to $68 on June 16, 2021. Similarly, the Royal Bank of Canada raised the price target to $62.
As of Q1 2021, we see that hedge funds are turning bullish on Nutrien Ltd. (NYSE: NTR), as 33 funds have positions in the company, up from 25 in the quarter earlier.
Like Palantir Technologies Inc. (NYSE: PLTR), Sea Limited (NYSE: SE), BP p.l.c. (NYSE: BP), Uber Technologies, Inc. (NYSE: UBER), General Motors Company (NYSE: GM), MGM Resorts International (NYSE: MGM), Bristol-Myers Squibb Company (NYSE: BMY), Chevron Corporation (NYSE: CVX), and Linde plc (NYSE: LIN), Nutrien Ltd. (NYSE: NTR) is one of the best beginner stocks to invest in right now.
8. Bristol-Myers Squibb Company (NYSE: BMY)
Number of Hedge Fund Holders: 81
Bristol-Myers Squibb Company (NYSE: BMY) is an American biopharmaceutical company, operating globally. The company develops and delivers medications for serious conditions, including cancer, diabetes, cardiovascular disease, hepatitis, etc. This Fortune 500 company is 11th on our list of the best beginner stocks to invest in right now.
In Q1 2021, Bristol-Myers Squibb Company (NYSE: BMY) recorded a revenue of over $11 billion, up from $10.7 billion during the same period last year. The BMY stock price has also soared by 16% in the past year and 8.3% year to date. Bristol-Myers Squibb Company (NYSE: BMY) has paid dividends since 1970. The board has also announced a quarterly dividend of $0.49 per share earlier in March this year.
At the end of Q1 2021, 81 hedge funds tracked by Insider Monkey hold positions in Bristol-Myers Squibb Company (NYSE: BMY), worth over $5 billion.
Like Palantir Technologies Inc. (NYSE: PLTR), Sea Limited (NYSE: SE), BP p.l.c. (NYSE: BP), Uber Technologies, Inc. (NYSE: UBER), General Motors Company (NYSE: GM), MGM Resorts International (NYSE: MGM), Chevron Corporation (NYSE: CVX), and Linde plc (NYSE: LIN), Bristol-Myers Squibb Company (NYSE: BMY) is one of the best beginner stocks to invest in right now.
7. MGM Resorts International (NYSE: MGM)
Number of Hedge Fund Holders: 57
MGM Resorts International (NYSE: MGM) is an American resort and services company operating in different states. With the expected travel boom after the vaccination process, MGM Resorts International (NYSE: MGM) becomes one of the best beginner stocks to invest in right now.
In Q1 2021, MGM Resorts International (NYSE: MGM) recorded a revenue of over $1.6 billion, up from $1.4 billion in the quarter earlier. Having seen the low of $9 in March 2020, the stock price has soared by 119% in the past year and 39% year to date. On June 10, JPMorgan raised its price target on MGM Resorts International (NYSE: MGM) from $47 to $52.
Of the 866 hedge funds in our database, 57 funds hold positions in MGM Resorts International (NYSE: MGM) at the end of Q1, 2021. The number of holders is up from 44 in the previous quarter.
Like Palantir Technologies Inc. (NYSE: PLTR), Sea Limited (NYSE: SE), BP p.l.c. (NYSE: BP), Uber Technologies, Inc. (NYSE: UBER), General Motors Company (NYSE: GM), Bristol-Myers Squibb Company (NYSE: BMY), Chevron Corporation (NYSE: CVX), and Linde plc (NYSE: LIN), MGM Resorts International (NYSE: MGM) is one of the best beginner stocks to invest in right now.
Longleaf Partners Fund recently released its Q1 2021 investor letter and mentioned MGM Resorts International (NYSE: MGM) in it. Here is what the fund has to say:
“MGM (21%, 1.44%), the casino and online gaming company, also contributed to the Fund’s strong returns. MGM’s Las Vegas properties performed particularly well during the fourth quarter, with October marking the best month since pre-COVID February, positive quarterly EBITDA and strong 2021 bookings. MGM’s online gaming and sportsbetting app, BetMGM, is one of the leaders in US online gaming, with a better market share in the more profitable iGaming than in the higher profile but lower margin sports gaming. MGM has demonstrated high conversion rates of its hotel guests and we believe that, with Barry Diller’s help, they will build a competitive long-term advantage with lower customer acquisition costs. MGM’s Macau subsidiary, MGM China, also appreciated as the Macau market partially reopened. We believe there is significant additional upside for the Macau business over the medium-to-long term.”
6. Cloudflare, Inc. (NYSE: NET)
Number of Hedge Fund Holders: 45
Cloudflare, Inc. (NYSE: NET) is a web security and services company based in America. The company has shown consistent growth over the years with its Q1 2021 revenue standing at $138 million, compared with $91 million during the same period last year.
Recently, Cloudflare, Inc. (NYSE: NET) has partnered with California-based technology company NVIDIA Corporation (NASDAQ: NVDA) to provide the developers with artificial intelligence, which will be 75% faster and less expensive.
Insider Monkey’s database shows that 45 hedge funds own stakes in Cloudflare, Inc. (NYSE: NET), worth $792 million.
Like Palantir Technologies Inc. (NYSE: PLTR), Sea Limited (NYSE: SE), BP p.l.c. (NYSE: BP), Uber Technologies, Inc. (NYSE: UBER), General Motors Company (NYSE: GM), MGM Resorts International (NYSE: MGM), Bristol-Myers Squibb Company (NYSE: BMY), Chevron Corporation (NYSE: CVX), and Linde plc (NYSE: LIN), Cloudflare, Inc. (NYSE: NET) is one of the best beginner stocks to invest in right now.
Alger Mid Cap Focus Fund published its Q4 2020 investor letter and mentioned Cloudflare, Inc. (NYSE: NET) in it. Here is what it has to say:
“Cloudflare. Inc. provides a broad range of network services to businesses of all sizes across the world. Cloudflare’s intelligent global network spans more than 200 cities in over 100 countries. It offers network security, performance and reliability to a growing portion of global web traffic. Today. over 15% of global internet requests go through Cloudflare. Cloudflare’s serverless network design allows this global network to be a key component layer as new developments for edge cornputing. 5G and Internet of Things increase the importance of secure. reliable edge networks. Cloudflare stock outperformed in the fourth quarter following the announcement of Cloudflare One, a cloud-bas. network-as-a-service platform designed to replace the traditional enterprise network infrastructure. The Cloudflare One solution merges existing Cloudflare access and security solutions along with new enterprise-specific features into a unified Zero Trust network that can be managed through a single “pane of glass.” or display screen. With the rapid shift to remote work caused by the pandemic, this product increases Cloudflare’s potential for winning business from enterprise customers seeking to adapt to this new business environment.
While Cloudflare One adoption is still early. Cloudflare has already started to demonstrate an improved ability to sell to large customers. When discussing its third quarter results. Cloudflare said that it is continuing to sign up larger enterprise customers. including its first client to generate more than $10 million in annual recurring revenue. Cloudflare has just started to better monetize its more than 100.000 paying customer base. which along with continued product innovation, gives the company strong growth potential.”
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Disclosure. None. 16 Best Beginner Stocks to Invest in Right Now is originally published on Insider Monkey.
