5 Best Defensive Stocks To Buy Now

1. Visa Inc. (NYSE:V)

Number of Hedge Fund Holders: 173

Visa Inc. (NYSE:V) is one of the best defensive stocks to buy now according to hedge funds. Visa Inc. (NYSE:V) dominates the payments industry which continues to thrive even in the midst of recession as companies, vendors and customers have to process their payments and carry out basic transactions irrespective of the economic conditions. With several years of consistent dividend increases, Visa Inc. (NYSE:V) is a solid choice for risk-averse investors.

As of the end of the first quarter of 2023, 173 hedge funds out of the 943 funds tracked by Insider Monkey were long Visa Inc. (NYSE:V).

Manole Capital Management made the following comment about Visa Inc. (NYSE:V) in its second quarter 2023 investor letter:

“We like to start out all of our discussions by telling investors who we are. We are FINTECH investors, and we define Fintech as “anything utilizing technology to improve an established process.” We realize that half of Fintech is financial, but we don’t invest in traditional, credit sensitive banks. Having managed money during the Financial Crisis, we learned firsthand how certain opaque and balance sheet intensive financials could go bankrupt or insolvent.

We prefer transaction-based businesses, generating recurring revenue, with sustainable margins, and significant cash flow. From our perspective, the perfect example of a FINTECH business is the secularly growing payments industry. Names like Visa Inc. (NYSE:V) or Mastercard, that generate revenue and profit per swipe or transaction, without the underlying credit sensitivity or risk associated with that underlying line of credit.”

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