In this article, we discuss the 5 best growth stocks to invest in for the next 5 years. If you want to review our discussion on the stock market landscape, head over to the 13 Best Growth Stocks To Invest In For the Next 5 Years.
5. Merck & Co., Inc. (NYSE:MRK)
P/E Ratio: 961.50
Quarterly Revenue Growth: 13.82%
Number of Hedge Fund Holders: 98
Merck & Co., Inc. (NYSE:MRK), an esteemed American multinational pharmaceutical giant headquartered in Rahway, New Jersey, boasts a storied legacy dating back to the Merck Group’s inception in Germany in 1668. Serving as the American branch, the company operates under the name Merck Sharp & Dohme (MSD) outside the United States and Canada, maintaining a prominent position within the pharmaceutical landscape. Its core pursuits encompass the development of pharmaceuticals, vaccines, biologic therapies, and animal health products.
In the fourth quarter of 2023, Insider Monkey’s tracking of hedge fund activity revealed that 98 out of the 933 surveyed hedge funds held shares of Merck & Co., Inc. (NYSE:MRK). Notably, among these investors, Ken Fisher’s Fisher Asset Management emerged as the foremost shareholder in the company, boasting holdings valued at $1.4 billion.
4. Eli Lilly and Company (NYSE:LLY)
P/E Ratio: 130.71
Quarterly Revenue Growth: 28.10%
Number of Hedge Fund Holders: 102
Established in 1876, Eli Lilly and Company (NYSE:LLY) is a prestigious American pharmaceutical firm headquartered in Indianapolis, Indiana. Named after its founder, Colonel Eli Lilly, a distinguished pharmaceutical chemist and Civil War veteran, the company boasts a global presence, with operations spanning 18 other countries.
Eli Lilly and Company (NYSE:LLY) attracted attention on April 2 when Citi analyst Andrew Baum raised its shares’ price target to $895 from $675, maintaining a Buy rating.
Insider Monkey’s analysis of hedge fund activity in December 2023 revealed that out of the 933 profiled hedge funds, 102 held shares of the company. Among these, Ken Fisher’s Fisher Asset Management had the largest stake in Eli Lilly and Company (NYSE:LLY), valued at $2.6 billion.
3. Advanced Micro Devices, Inc. (NASDAQ:AMD)
P/E Ratio: 292.68
Quarterly Revenue Growth: 10.16%
Number of Hedge Fund Holders: 120
Based in Santa Clara, California, Advanced Micro Devices, Inc. (NASDAQ:AMD) is a renowned global semiconductor company specializing in the development of computer processors and associated technologies, catering to both business and consumer markets.
On March 11, Cantor Fitzgerald analysts reaffirmed their Overweight rating on Advanced Micro Devices, Inc. (NASDAQ:AMD) and set a price target of $190.
Insider Monkey’s analysis of hedge fund activity in the fourth quarter of 2023 revealed that out of the 933 surveyed hedge funds, 120 had holdings in Advanced Micro Devices, Inc. (NASDAQ:AMD). The largest hedge fund shareholder of the company is Ken Fisher’s Fisher Asset Management, boasting ownership of 28 million shares valued at $4.1 billion.
Meridian Funds stated the following regarding Advanced Micro Devices, Inc. (NASDAQ:AMD) in its fourth quarter 2023 investor letter:
“Advanced Micro Devices, Inc. (NASDAQ:AMD) is a global semiconductor chip maker specializing in central processing units (CPUs), which are considered the core component of most computing devices, and graphics processing units (GPUs), which accelerate operations running on CPUs. We invested in 2018 when it was a mid-cap value stock plagued by many years of underperformance due to lagging technology and lost market hi share versus competitors Intel and Nvidia. Our research identified that changes and investments made by current management under CEO Lisa Su had, over several years, finally resulted in compelling technology that positioned AMD as a stronger competitor to Nvidia and that its latest products were superior to Intel’s. We invested on the the belief that AMD’s valuation at that that time did not reflect the potential for its technology leadership to generate significant market share gains and improved profits. This thesis has been playing out for several years. During the quarter, AMD unveiled more details about its upcoming GPU products for the AI market. The stock reacted positively to expectations that AMD’s GPU servers will be a viable alternative to Nvidia. Although we pared back our exposure to AMD into strength as part of our risk-management practice, we maintained a position in the stock. We believe AMD will continue to gain share in large and growing markets and is reasonably valued relative to the potential for significantly higher earnings.”
2. Uber Technologies, Inc. (NYSE:UBER)
P/E Ratio: 81.09
Quarterly Revenue Growth: 15.44%
Number of Hedge Fund Holders: 129
Based in San Francisco, California, Uber Technologies, Inc. (NYSE:UBER) operates as a technology platform connecting consumers with independent ride service providers, offering a range of transportation options including public transit, bikes, and scooters. Moreover, Uber provides on-demand food delivery, freight services, business fleet solutions, and same-day delivery, catering to more than 142 million monthly active platform consumers across 70 countries.
In a significant move on February 14, Uber Technologies, Inc. (NYSE:UBER) announced its inaugural share repurchase program, authorizing its Board of Directors to buy back up to $7 billion of the company’s common stock.
As revealed by Insider Monkey’s Q4 2023 database encompassing 933 hedge funds, 129 had acquired and retained shares of Uber Technologies, Inc. (NYSE:UBER). Among them, D. E. Shaw’s D E Shaw emerged as the largest hedge fund shareholder, with an investment valued at $886 million.
Uber Technologies, Inc. (NYSE:UBER) was mentioned in RiverPark Advisors’ fourth quarter 2023 investor letter:
“Uber Technologies, Inc. (NYSE:UBER): UBER was a top contributor in the quarter following better than expected 3Q23 earnings and 4Q23 guidance. Gross bookings of $35.3 billion were up 21% year over year. Mobility gross bookings of $17.9 billion grew 30% over last year driven by a combination of product innovation and driver availability. Delivery gross bookings of $16 billion were up 16% from last year and continued to be strong throughout the quarter. 1Q Adjusted EBITDA of $1.1 billion, up $576 million year over year, was better than management’s guidance of $1 billion, and the company generated $900 million of free cash flow, up from $358 million last year. Management guided to continuing growth in 4Q Gross Bookings (23.5% growth) and Adjusted EBITDA (of $1.2 billion).
UBER remains the undisputed global leader in ride sharing, with a greater than 50% share in every major region in which it operates. The company is also a leader in food delivery, where it is number one or two in the more than 25 countries in which it operates.1 Moreover, after a history of losses, the company is now profitable, delivering expanding margins and substantial free cash flow. We view UBER as more than a ride sharing and food delivery service; we also see it as a global mobility platform with 142 million users (by comparison, Amazon Prime has 200 million members) and the ability to penetrate new markets of on-demand services, such as package and grocery delivery, travel, and hourly worker staffing. Given its $5.2 billion of unrestricted cash and $5.1 billion of investments, the company today has an enterprise value of $128 billion, indicating that UBER trades at 21x our estimates of next year’s free cash flow.”
1. Salesforce, Inc. (NYSE:CRM)
P/E Ratio: 65.07
Quarterly Revenue Growth: 10.77%
Number of Hedge Fund Holders: 131
Salesforce, Inc. (NYSE:CRM) stands out as a leading American provider of cloud-based software, focusing on customer relationship management solutions. Its comprehensive suite of tailored software and applications covers various aspects including sales, customer service, marketing automation, e-commerce, analytics, and application development, catering to a wide range of business needs.
Insider Monkey’s tracking of hedge fund activity in the fourth quarter of 2023 revealed that 131 hedge funds held positions in Salesforce, Inc. (NYSE:CRM), marking an increase from 122 funds in the previous quarter.
Disclosure: None. You can also take a look at the 19 Best Alternatives to Discord in 2024 and Top 15 Cities Where Gen Z is Moving in the US.
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