In this article, we discuss 5 best debt free stocks to buy. If you want to see more best debt free stocks to buy, the risk/reward, and methodology of this list, go directly to 11 Best Debt Free Stocks to Buy.
5. T. Rowe Price Group, Inc. (NASDAQ:TROW)
Number of Hedge Fund Holders: 30
T. Rowe Price Group, Inc. (NASDAQ:TROW) is a leading asset management company with a debt to equity ratio of 0 and a long term debt to equity ratio of 0. As of December 31, 2022, the company had $1.28 trillion in assets under management.
Although the stock has fallen over 46% from its highs in 2021, shares of T. Rowe Price Group, Inc. (NASDAQ:TROW) have still nearly doubled from the beginning of 2013. T. Rowe Price Group, Inc. (NASDAQ:TROW) has a dividend yield of 4.05% as of 1/17.
4. Monster Beverage Corporation (NASDAQ:MNST)
Number of Hedge Fund Holders: 39
Monster Beverage Corporation (NASDAQ:MNST) is a leading energy drink company whose stock has has surged from under $16 in January 2013 to $102.17 as of 1/17. Given the company’s strong marketing, Monster Beverage Corporation (NASDAQ:MNST) has achieved 30 straight years of increased sales. For the nine months ended September 30,2022 the company achieved $4.8 billion in net sales, up 16.6% over the net sales of $4.1 billion for the same period in 2021.
Despite the strong growth, Monster Beverage Corporation (NASDAQ:MNST) has a debt to equity ratio of 0 and a long term debt to equity ratio of 0.
3. Arista Networks, Inc. (NYSE:ANET)
Number of Hedge Fund Holders: 42
Arista Networks, Inc. (NYSE:ANET) is a cloud networking solutions company that reported sales of $1.177 billion in Q3 2022, up 57.2% from the third quarter of 2021. For the period, Arista Networks, Inc. (NYSE:ANET) also earned an adjusted net income of $1.25 per diluted share up from the adjusted net income of $0.74 per share in Q3 2021.
42 hedge funds in our database owned shares of Arista Networks, Inc. (NYSE:ANET) at the end of Q3, ranking the stock #3 on our list of 11 Best Debt Free Stocks to Buy.
Arista Networks, Inc. (NYSE:ANET) shares have increased substantially from their 2014 stock price of under $23 per share.
2. Chipotle Mexican Grill, Inc. (NYSE:CMG)
Number of Hedge Fund Holders: 45
Chipotle Mexican Grill, Inc. (NYSE:CMG) has been one of the more volatile stocks on our list in terms of its performance over the past decade. Nevertheless, despite the volatility, Chipotle Mexican Grill, Inc. (NYSE:CMG) stock has tripled from 2013 as the market anticipates Chipotle Mexican Grill, Inc. (NYSE:CMG) to grow its EPS in the future considering its forward P/E ratio of 36.04. Although opening restaurants take capital, Chipotle Mexican Grill, Inc. (NYSE:CMG) does not franchise and the company has a debt to equity ratio of 0 and long term debt to equity ratio of 0.
1. Meta Platforms, Inc. (NASDAQ:META)
Number of Hedge Fund Holders: 177
Meta Platforms, Inc. (NASDAQ:META) ranks #1 on our list of 11 Best Debt Free Stocks to Buy given 177 hedge funds in our database owned shares of the social media giant at the end of the third quarter. Although Meta Platforms, Inc. (NASDAQ:META) actually does have some long term debt given its long term debt ratio of 0.08, Meta Platforms, Inc. (NASDAQ:META) has a lot of cash and short term investments on its balance sheet to more than cover its debt. As of September 30, the company had cash, cash equivalents, and marketable securities of $41.78 billion versus long term debt of $9.92 billion. Although Meta Platforms, Inc. (NASDAQ:META) stock hasn’t done well in 2022, shares are still substantially higher than in 2013.
ClearBridge Investments commented on Meta Platforms, Inc. (NASDAQ:META) in a Q3 2022 investor letter,
We initiated a new position in Meta Platforms, Inc. (NASDAQ:META), in the communication services sector, which operates the Facebook and Instagram social media platforms and is a leading digital advertising provider. We have been carefully watching the company over the last few quarters and believe headwinds from lower monetizing in Facebook and Instagram Reels and pressures from consumer privacy measures are poised to lessen. We believe the company has begun to fully acclimate to this new environment, will achieve greater effectiveness in Reels monetization and find ways to adapt to new privacy standards which will rebound advertising efficiency. Combined with a greater focus on cost control, we believe these initiatives will help contribute to further margin expansion and leave the company well-positioned moving forward.
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