In this article, we discuss the 5 best fundamental stocks to buy. If you want to read our detailed analysis of these stocks, go directly to the 11 Best Fundamental Stocks to Buy.
5. Eli Lilly and Company (NYSE:LLY)
Number of Hedge Fund Holders: 102
Eli Lilly and Company (NYSE:LLY) develops and markets human pharmaceuticals. On November 8, investment advisory Deutsche Bank initiated coverage of Eli Lilly and Company (NYSE:LLY) stock with a Hold rating and a price target of $535.
Among the hedge funds being tracked by Insider Monkey, Florida-based investment firm GQG Partners is a leading shareholder in Eli Lilly and Company (NYSE:LLY) with 3.2 million shares worth more than $1.7 billion.
In its Q3 2023 investor letter, RiverPark Advisors highlighted a few stocks and Eli Lilly and Company (NYSE:LLY) was one of them. Here is what the fund said:
“Eli Lilly and Company (NYSE:LLY): LLY discovers, develops, manufactures, and markets pharmaceuticals. The company manufactures and distributes products through facilities in the United States and seven other countries and sells into 110 countries. The company has a broad and deep portfolio of products including a focus on diabetes, oncology, immunology, and neuroscience. More recently, LLY’s obesity drug Mounjaro, has delivered revenue growth acceleration, and investors are optimistic that the company’s Alzheimer drug, currently in trials, will add to that growth in the future.
LLY has a stable portfolio of franchise products that enables it to invest heavily in its product pipeline. We believe that this combination of franchise and growth products will drive high teens revenue growth and a four-fold increase in free cash flow in the next five years. We initiated a small position in August.”
4. UnitedHealth Group Incorporated (NYSE:UNH)
Number of Hedge Fund Holders: 104
UnitedHealth Group Incorporated (NYSE:UNH) operates as a diversified healthcare firm. On November 20, investment advisory Jeffeires maintained a Hold rating on UnitedHealth Group Incorporated (NYSE:UNH) stock and lowered the price target to $503 from $565.
At the end of the third quarter of 2023, 104 hedge funds in the database of Insider Monkey held stakes worth $10.9 billion in UnitedHealth Group Incorporated (NYSE:UNH), compared to 111 in the preceding quarter worth $10.1 billion.
In its Q3 2023 investor letter, Madison Investments, an asset management firm, highlighted a few stocks and UnitedHealth Group Incorporated (NYSE:UNH) was one of them. Here is what the fund said:
“The top contributors in the quarter were Eli Lilly, Jacobs, Alphabet, Costco, and UnitedHealth Group Incorporated (NYSE:UNH). UnitedHealth responded well to a solid second quarter, with a better medical loss ratio driving the better-than-expected results. Additionally, UNH modestly raised guidance for the full year.
We updated the sustainable scorecard for UnitedHealth Group. The company continues to have Above Average Corporate Governance with a clear policy on separating the roles of the Chair of the Board and the CEO. We also rate the company Above Average on Social factors due to its clear cybersecurity, privacy, and data governance policies. The company continues to diversify its top management positions, where 40% of top management positions are held by women, up from 37% in 2020. We reduced our Environment rating to Average from Above Average as the company has significantly expanded its footprint in the last few years by acquiring local providers. The company is at the beginning of its journey to source renewable electricity for 100% of its operations by 2030.”
3. JPMorgan Chase & Co. (NYSE:JPM)
Number of Hedge Fund Holders: 109
JPMorgan Chase & Co. (NYSE:JPM) operates as a financial services company worldwide. On December 14, investment advisory Wells Fargo maintained an Overweight rating on JPMorgan Chase & Co. (NYSE:JPM) stock and raised the price target to $200 from $185.
At the end of the third quarter of 2023, 109 hedge funds in the database of Insider Monkey held stakes worth $6.6 billion in JPMorgan Chase & Co. (NYSE:JPM), compared to 106 in the preceding quarter worth $4.3 billion.
2. Apple Inc. (NASDAQ:AAPL)
Number of Hedge Fund Holders: 134
Apple Inc. (NASDAQ:AAPL) is a consumer electronics firm. On November 19, investment advisory Morgan Stanley maintained an Overweight rating on Apple Inc. (NASDAQ:AAPL) stock.
At the end of the third quarter of 2023, 134 hedge funds in the database of Insider Monkey held stakes worth $179 billion in Apple Inc. (NASDAQ:AAPL), compared to 135 in the previous quarter worth $194 billion.
In its Q3 2023 investor letter, Baron Funds highlighted a few stocks and Apple Inc. (NASDAQ:AAPL) was one of them. Here is what the fund said:
“After a strong start to the year, shares of Apple Inc. partially retraced their gains this quarter. Mixed second calendar quarter financial results, with iPhone, iPad, and Wearables revenue coming in just shy of consensus expectations, coupled with elevated investor concerns about the macro economy and potential weakness in consumer spending later this year, pressured shares. Despite these quarterly fluctuations in product sales, we are encouraged by several long-term trends, including: (1) revenue from higher-margin services like the App Store, iCloud, and Apple Pay, which are growing faster than the overall business, driving better revenue visibility and higher free-cash-flow (FCF) margins; (2) continued gains in global market share in smartphones, wearables, and other hardware categories; and (3) consistent returns of capital to shareholders via share repurchases and dividends. On top of these trends in the core business, Apple is thoughtfully investing in new categories like augmented reality, search, financial services, and streaming media content. We took advantage of weakness in the quarter to add to our position in Apple.”
1. Microsoft Corporation (NASDAQ:MSFT)
Number of Hedge Fund Holders: 306
Microsoft Corporation (NASDAQ:MSFT) is a Washington-based technology company. On November 16, investment advisory Jefferies maintained a Buy rating on Microsoft Corporation (NASDAQ:MSFT) stock with a price target of $400.
Among the hedge funds being tracked by Insider Monkey, Texas-based investment firm Fisher Asset Management is a leading shareholder in Microsoft Corporation (NASDAQ:MSFT) with 24 million shares worth more than $7.8 billion.
In its Q3 2023 investor letter, Jackson Peak Capital, an investment management firm, highlighted a few stocks and Microsoft Corporation (NASDAQ:MSFT) was one of them. Here is what the fund said:
“The Microsoft Corporation (NASDAQ:MSFT)/Activision Blizzard, Inc. (NASDAQ:ATVI) merger arbitrage came to a successful conclusion with the court denying the FTC’s preliminary injunction request. The deal subsequently received approval from the UK CMA and closed in October. The ATVI position was an example of “staying around the hoop” of a significant arb opportunity. At first, the position led to a small loss in Q2 when the UK CMA initially blocked the deal in April, but we stayed close to the case, analyzed the FTC trial and scaled up the ATVI position as it became apparent FTC had a weak case, meaning the probability of the deal going through was mispriced by the market since the companies would likely find a solution to work with the UK CMA (only global regulator who had an issue) if the FTC lost.”
You can also take a peek at 10 Best Stocks in Each Sector and 10 Best Regional Bank Stocks To Invest In.
