5 Best Diversified Stocks to Buy Now

In this article, we discuss the 5 best diversified stocks to buy now. If you want to read a detailed analysis including the pros and cons of diversified companies, go directly to the 11 Best Diversified Stocks to Buy Now.

5. The Walt Disney Company (NYSE:DIS)

Number of Hedge Fund Holders: 99

The Walt Disney Company (NYSE:DIS) is a California-based mass media and entertainment conglomerate. The company operates entertainment studios, media networks, theme parks, and resorts. The Walt Disney Company (NYSE:DIS) also has investments in the gaming industry and real estate sector.

On February 13, JPMorgan analyst Philip Cusick resumed coverage on The Walt Disney Company (NYSE:DIS) shares with an Overweight rating and a $135 price target.

The Walt Disney Company (NYSE:DIS)’s shares were held by 99 hedge funds in the fourth quarter of 2022. Trian Partners initiated its position in the company in Q4 with approximately 9.03 million shares worth around $784.509 million, making it the most significant stakeholder of the company in the quarter.

Here is what ClearBridge Investments had to say about The Walt Disney Company (NYSE:DIS) in its fourth-quarter 2022 investor letter:

“We exited The Walt Disney Company (NYSE:DIS) to focus on areas of the media industry with better risk/reward. Disney has significant exposure to consumer spending that is showing early signs of weakening. We decided to move on from the name as its traditional linear programming business is dissolving more quickly than expected, while its Disney+ streaming business cannot offset the affiliate fees and advertising revenue that the company has relied on for years. Disney’s parks business has done well recently due to strong pricing power but we have concerns that consumers will continue to spend on such discretionary purchases in a recessionary environment. At this point in the cycle, we believe Netflix has more ways to innovate and improve profitability.”

4. Berkshire Hathaway Inc. (NYSE:BRK-B)

Number of Hedge Fund Holders: 110

Berkshire Hathaway Inc. (NYSE:BRK-B) is a multinational multi-industry holding company. It is one of the most diversified companies in the world with operations in insurance, energy and utilities, transportation, chemicals, batteries, construction, retail, and real estate, along with many others. As of February 2023, Berkshire Hathaway Inc. (NYSE:BRK-B) owns 65 discrete companies with over 260 subsidiaries.

Berkshire Hathaway Inc. (NYSE:BRK-B) has posted significant shareholder returns through buybacks in the last few years. Between 2020 and 2022, the firm made nearly $60 billion worth of share repurchases. In the first two months of 2023, Berkshire Hathaway Inc. (NYSE:BRK-B) repurchased $1.9 billion worth of company stock and plans to repurchase $3 billion worth of shares in total by the end of the first quarter.

Here is what Black Bear Value Fund has to say about Berkshire Hathaway Inc. (NYSE:BRK-A) in its Q3 2022 investor letter:

“Going forward I expect Berkshire to compound at above average returns from this price. BRK is a collection of high-quality businesses, excellent management, and a good amount of optionality in their cash position. If the cash were to be deployed accretively, the true value would be greater than an 8% premium (as mentioned above). The combination of a pie that is growing, an increasing share of said pie due to stock buybacks, upside optionality from cash and a tight range of likely business outcomes that span a variety of economic futures gives me comfort in continuing to own Berkshire.”

3. Alibaba Group Holding Limited (NYSE:BABA)

Number of Hedge Fund Holders: 113

Alibaba Group Holding Limited (NYSE:BABA) is a Chinese multinational company. Its operations include e-commerce, cloud computing, digital media and entertainment, financial services, and logistics and delivery. It was founded in 1999 and is headquartered in Hangzhou, China.

On March 17, Susquehanna reaffirmed a Positive rating on Alibaba Group Holding Limited (NYSE:BABA)’s shares and lowered the price target to $175 from $185. The firm considers the corporation to be China’s leading e-commerce company with a sizeable secular growth opportunity.

Here is what Artisan Partners had to say about Alibaba Group Holding Limited (NYSE:BABA) in its Q4 2022 investor letter:

“Finally, within our technology theme, an area that we have trimmed heavily over the year, we exited Alphabet due to deteriorating fundamentals and reinitiated a position in Alibaba Group Holding Limited (NYSE:BABA), a stock we have owned previously, as it enters a new phase in its history, one most likely without founder Jack Ma after he became a lightning rod for the Chinese government’s technology crackdown beginning in late 2020. We are attracted to the company’s secular growth prospects in online and mobile commerce.”

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

Number of Hedge Fund Holders: 240

Amazon.com, Inc. (NASDAQ:AMZN) is a multinational technology conglomerate headquartered in Washington. The company went public in 1997 and sold music and videos along with books through a number of online sellers. However, it is now one of the largest companies in the world by market cap and has diversified its portfolio to include e-commerce, advertising, cloud computing, digital streaming platforms, and artificial intelligence.

Amazon.com, Inc. (NASDAQ:AMZN) is one of the most buzzing stocks to buy. In the fourth quarter of 2022, 240 hedge funds had a stake worth $27.5 billion, and Harris Associates took the top spot among hedge fund holders with 19.32 million shares worth $1.62 billion.

Here is what Artisan Partners had to say about Amazon.com, Inc. (NASDAQ:AMZN) in its Q4 2022 investor letter:

“Amazon.com, Inc. (NASDAQ:AMZN) is the world’s largest retailer. The company has gone through a period of massive investment as it doubled its fulfillment network and hired over 800,000 people to meet growing demand over the past few years. Capital expenditure (capex) in the 2017 to 2019 period was $10 billion – $17 billion per year before ramping up to $40 billion in 2020, $61 billion in 2021 and is expected to end 2022 at another $61 billion. We believe the company is in the later innings of this capex cycle and will be transitioning toward a period of harvesting those investments through higher margins and free cash flow generation. At a valuation that appears to be discounting a deteriorating environment for consumer spending, we decided to start a GardenSM position.”

1. Microsoft Corporation (NASDAQ:MSFT)

Number of Hedge Fund Holders: 259

Microsoft Corporation (NASDAQ:MSFT) is an American tech giant that operates in several markets. The company’s products and services include operating systems, cloud computing, gaming, search and advertising, computer hardware, and developing tools, along with a few other things. 

Currently, Microsoft Corporation (NASDAQ:MSFT) is one of the most significant Strong Buy stocks. In the last three months, 31 analysts have covered the company and 26 of them maintain a Positive rating on Microsoft Corporation (NASDAQ:MSFT)’s shares. The average price target by Wall Street analysts for the company is $291.74.

Here is what Ariel Investments had to say about Microsoft Corporation (NASDAQ:MSFT) in its Q4 2022 investor letter:

“Enterprise software provider Microsoft Corporation (NASDAQ:MSFT) also traded lower, as higher interest rates and economic concerns have created headwinds for growth-oriented technology companies. We believe this price action runs counter to Microsoft’s solid fundamentals, competitive positioning and long-term business outlook. We continue to anchor on the company driving value creation by capitalizing on a broad and deep set of opportunities, most notably within hybrid cloud infrastructure. The platform continues to demonstrate share gains and strong multi-year purchase intent as enterprises transition to cloud based platforms. At current trading levels, we believe Microsoft’s risk/reward is skewed to the upside.”

You can also take a look at the 13 Best Consumer Discretionary Stocks To Buy and 13 Best Monthly Dividend Stocks to Buy According to Analysts.

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