In this article, we discuss the 5 best grocery stocks to buy now. To go through our analysis of the grocery and food industry, go directly to the 13 Best Grocery Stocks to Buy Now.
5. Albertsons Companies, Inc. (NYSE:ACI)
Number of Hedge Fund Holders: 53
Albertsons Companies, Inc. (NYSE:ACI) is a retail company that operates a chain of supermarkets and drug stores across the U.S. It markets its products under various brand names, including Lucerne Dairy Farms, Waterfront Bistro, Signature Reserve, and more.
Albertsons Companies, Inc. (NYSE:ACI) saw net sales and other revenue increase to $18.6 billion in the third quarter of its financial year from $18.2 billion in the same period in the previous financial year. Albertsons attributed this growth to a 2.9% increase in same-store sales, driven by robust growth in pharmacy sales. The retailer also saw 21% year-on-year growth in digital sales in this period.
In the third quarter, 53 hedge funds had investments in Albertsons Companies, Inc. (NYSE:ACI)’s stock. Stephen Feinberg’s Cerberus Capital Management was the biggest stakeholder in the company, with 151.818 million shares worth $3.45 billion.
4. Target Corporation (NYSE:TGT)
Number of Hedge Fund Holders: 58
Target Corporation (NYSE:TGT) is a prominent retail company that operates a chain of general merchandise stores across the United States. Known for its consistent dividend growth, Target has been rewarding shareholders with increasing dividends for the past 52 years. As of December 21, the stock provides a quarterly dividend of $1.10 per share, resulting in a dividend yield of 3.21%.
In the third quarter of 2023, the number of hedge funds tracked by Insider Monkey that owned stakes in Target Corporation (NYSE:TGT) increased to 58, up from 45 in the previous quarter. The combined value of these stakes exceeds $1.3 billion.
3. Costco Wholesale Corporation (NASDAQ:COST)
Number of Hedge Fund Holders: 65
Costco Wholesale Corporation (NASDAQ:COST) operates a global network of membership warehouses, primarily under the “Costco Wholesale” brand. The company provides high-quality, brand-name products at significantly lower prices compared to traditional wholesale or retail outlets. As of January 15, Costco Wholesale Corporation (NASDAQ:COST) offers a quarterly dividend of $15.00 per share, resulting in a dividend yield of 0.60%. The company has consistently increased its dividend for the past 19 years, emphasizing its commitment to rewarding shareholders.
According to data from Insider Monkey, 65 hedge funds had long positions in Costco Wholesale Corporation (NASDAQ:COST) at the end of Q3 2023, compared to 67 funds in the previous quarter. Bridgewater Associates, led by Ray Dalio, is a notable stakeholder with 828,184 shares valued at over $467.8 million.
Tsai Capital Corporation stated the following regarding Costco Wholesale Corporation (NASDAQ:COST) in its fourth quarter 2023 investor letter:
“Costco Wholesale Corporation (NASDAQ:COST) ($660.08 – up 49.0% for the year. Recent high $681.91): Costco operates more than 860 warehouses worldwide and provides its members with a deep value proposition, promising not to charge more than a 15% markup on goods versus its own cost. This in turn has resulted in an extremely loyal membership base of more than 70 million, over $1,900 in net sales per square foot, and high-margin, recurring membership fees. Since 2012, W. Craig Jelinek has been at the helm of Costco and has perpetuated the values and culture of the company’s founder, Jim Sinegal. And while Mr. Jelinek recently stepped down as Chief Executive Officer, we see little change under his successor, Ron Vachris, who has worked at the firm for more than 40 years, having started out as a forklift driver. In many ways, Costco is a cult (I mean that in a positive way), and its allure is only just beginning to spread to international markets, including China. With a stellar management team, strong returns on capital and ample opportunities for growth, domestically and internationally, we believe Costco will continue to compound earnings at a low double-digit rate.”
2. Walmart Inc. (NYSE:WMT)
Number of Hedge Fund Holders: 80
Walmart Inc. (NYSE:WMT), a prominent American retail giant headquartered in Bentonville, Arkansas, is widely recognized for its expansive network of hypermarkets, discount department stores, and strategically positioned grocery outlets across the United States.
The company has maintained a remarkable track record of dividend increases for an impressive five decades, spanning 50 years. As of January 15, Walmart Inc. (NYSE:WMT) offers a quarterly dividend of $0.57 per share, resulting in a dividend yield of 1.41%.
In the third quarter of 2023, Walmart Inc. (NYSE:WMT) garnered significant attention from hedge funds, with 80 hedge funds establishing positions in the company, according to Insider Monkey’s database. The collective holdings of these hedge funds were valued at over $5.94 billion. Notably, Ken Fisher’s Fisher Asset Management emerged as the largest shareholder, boasting holdings valued at approximately $1.45 billion.
1. Amazon.com Inc (NASDAQ:AMZN)
Number of Hedge Fund Investors: 286
Amazon.com, Inc. (NASDAQ:AMZN), a prominent American multinational technology company, encompasses a diverse range of business interests, including e-commerce, cloud computing through Amazon Web Services (AWS), online advertising, digital streaming, and artificial intelligence. The company’s e-commerce platform is well-diversified, offering a wide range of products, including gourmet food, groceries, apparel, baby products, consumer electronics, beauty products, and more.
In the quarter ending in September, Amazon.com, Inc. (NASDAQ:AMZN) reported a 236% growth in EPS to $0.94. For its closely-watched Amazon Web Services Cloud business, the company recorded a 12% year-over-year sales increase to $23.1 billion, slightly below analysts’ expectations for sales of $23.2 billion. Amazon.com, Inc. (NASDAQ:AMZN) also stated that it anticipates sales to fall within the range of $160 billion and $167 billion for the current fourth quarter.
Based on data from Insider Monkey’s database, a total of 286 elite hedge funds held positions in Amazon.com, Inc. (NASDAQ:AMZN) stock, with a collective stake value of $38.8 billion. This represents an increase from the 278 hedge funds that collectively held a stake valued at $34.9 billion previously. Notably, Ken Fisher’s Fisher Asset Management emerged as the most significant stakeholder in the company, with 41.35 million shares valued at $5.25 billion.
Tsai Capital Corporation stated the following regarding Amazon.com, Inc. (NASDAQ:AMZN) in its fourth quarter 2023 investor letter:
“Amazon.com, Inc. (NASDAQ:AMZN) ($151.94 – up 80.9% for the year. Recent high $155.63): Amazon, founded by Jeff Bezos in his garage in 1994, is the most dominant e-commerce company and owns Amazon Web Services (AWS), the leading cloud provider. Andy Jassy, formerly head of AWS, became CEO of Amazon in 2021 and is executing exceptionally well. Because of their scale, AWS and Amazon retail benefit from numerous competitive advantages, which in turn drive a high customer value proposition. For example, instead of using the benefits of size to maximize short-term profits, Amazon operates with a scale-economies-shared business model, giving back some of its margin to the underlying consumer. This in turn drives further demand and strengthens the company’s ecosystem. Amazon’s long-term strategy masks the underlying earnings power of the business. As consumers continue to shift their spending from in-store purchases to online shopping, and as data continues to migrate from on-premise servers to the cloud, we expect Amazon to grow revenue at a low double-digit rate for at least the next five years and increase its profit margins over time.”
You can also take a look at 16 Best Mid-Cap Growth Stocks To Buy Now and 10 Narrow Moat Stocks Hedge Funds Are Buying
