In this piece, we will take a look at the five best long-term growth stocks to buy now. If you want to learn more about growth stocks, then head on over to the 11 Best Long Term Growth Stocks To Invest In.
5. Advanced Micro Devices, Inc. (NASDAQ:AMD)
Number of Hedge Fund Holders: 110
P/E Ratio: 964.59
Advanced Micro Devices, Inc. (NASDAQ:AMD), commonly abbreviated as AMD, is an American multinational semiconductor company based in Santa Clara, California, specializing in the development of computer processors and related technologies for business and consumer markets.
On November 13, investment advisory firm Roth MKM initiated coverage of Advanced Micro Devices, Inc. (NASDAQ:AMD) with a Buy rating and a price target of $125, emphasizing the company’s differentiated portfolio of high-performance compute and networking processors.
In the third quarter of 2023, there were 110 hedge funds with long positions in Advanced Micro Devices, Inc. (NASDAQ:AMD), down from 112 in the preceding quarter.
4. Adobe Inc. (NASDAQ:ADBE)
Number of Hedge Fund Holders: 112
P/E Ratio: 55.74
Adobe Inc. (NASDAQ:ADBE) is a versatile software company providing a range of products and solutions enabling individuals, teams, and enterprises to generate, publish, and promote content. Recognized as a leading choice for content creators, students, professionals, and consumers, Adobe Inc. (NASDAQ:ADBE) also operates a Digital Experience segment, empowering brands and businesses to create, manage, implement, and monetize customer experiences.
On October 27, Oppenheimer analyst Brian Schwartz upgraded Adobe Inc. (NASDAQ:ADBE) from Perform to Outperform, coupled with a revised price target of $660.00, signaling a positive perspective on Adobe Inc.’s performance and growth prospects.
112 out of the 910 hedge funds part of Insider Monkey’s third quarter of 2023 database had invested in the firm. Adobe Inc. (NASDAQ:ADBE)’s biggest hedge fund investor in the September quarter was Ken Fisher’s Fisher Asset Management as it owned 4.5 million shares that are worth $2.3 billion.
Here is what Polen Global Growth has to say about Adobe Inc. (NASDAQ:ADBE) in its Q3 2023 investor letter:
“Both Alphabet and Adobe’s businesses continue to perform well. With respect to Adobe, the most recent quarter delivered more of the same with constant currency revenue growing 13%, margin expansion, and over 2% of shares outstanding repurchased for non-GAAP earnings growth of over 20%. We believe its approach to GenAI through Firefly, which guarantees safe content because it trains on Adobe Stock, will continue to be attractive to enterprises. The counter to GenAI, and something we are keeping an eye on with Alphabet and Adobe, is that it requires heavy investment. While both businesses can leverage their scale and manage costs in other areas, we expect the investment in future growth through GenAI will weigh on company-wide margins over the near term.”
3. Salesforce, Inc. (NYSE:CRM)
Number of Hedge Fund Holders: 122
P/E Ratio: 140.34
Salesforce, Inc. (NYSE:CRM), headquartered in San Francisco, California, stands as an American cloud-based software company, specializing in customer relationship management. The company provides tailored software and applications designed for sales, customer service, marketing automation, e-commerce, analytics, and application development.
On August 30, Salesforce, Inc. (NYSE:CRM) unveiled its fiscal 2024 second-quarter results, reporting earnings of $2.12 per share—a significant 78% increase from the same quarter in the previous year. Fueled by an 11% rise in revenue, surpassing $8.6 billion, the company is scheduled to release its fiscal Q3 results on November 30 after the market closes. Salesforce, Inc. (NYSE:CRM) anticipates revenue between $8.70 billion and $8.72 billion, with diluted earnings per share ranging from $1.02 to $1.03. Analysts project a 53% growth in earnings for the full fiscal year.
Within Insider Monkey’s Q3 2023 database, 122 out of 910 hedge funds had invested in the company, with Ken Fisher’s Fisher Asset Management emerging as the largest shareholder, contributing to its $2.87 billion investment during the specified time period.
Harding Loevner talked about Salesforce, Inc. (NYSE:CRM) in its second-quarter 2023 investor letter. Here is what it said:
“Salesforce, Inc. (NYSE:CRM), a company we’ve owned since 2019, recently added ChatGPT-like capabilities onto its existing Al module, Einstein, to support its internal sales efforts and customer-facing software. For example, Einstein GPT can help generate marketing emails tailored to specific clients by using Salesforce’s customer database and past email correspondence to learn the most effective approach for each client. Einstein GPT is also different from off-the-shelf LLMS in three important ways: It keeps personal identifiable information private and secure, compared with external tools that retain anything a user enters. It employs the latest data in Salesforce’s system, as opposed to the sometimes-stale public data that train generic models. And generative Al capabilities can be integrated with other Salesforce offerings; the company has already introduced Slack GPT and Tableau GPT, Al-equipped versions of its workplace collaboration and analytics tools.”
2. Uber Technologies, Inc. (NYSE:UBER)
Number of Hedge Fund Holders: 146
P/E Ratio: 111.64
Headquartered in San Francisco, California, Uber Technologies, Inc. (NYSE:UBER) operates technology platforms that connect consumers with independent ride service providers. The company extends its services to various forms of transportation, such as public transit, bikes, and scooters. Additionally, Uber provides on-demand food delivery, freight services, business fleet solutions, and same-day delivery options. With a presence in over 70 countries, Uber serves more than 142 million monthly active platform consumers.
On November 20, Uber Technologies Inc (NYSE:UBER) announced its intention to issue $1.2 billion in five-year convertible bonds, scheduled to mature in 2028 and targeted at qualified institutional buyers. The ride-sharing company specified that a portion of the funds would be allocated to cover expenses related to entering capped call transactions, with the goal of mitigating dilution during the conversion into equity. Uber further outlined that the remaining proceeds would be utilized for the repayment, redemption, or repurchase of outstanding debt, including $1 billion of 7.5% notes set to mature in 2025.
At the end of the third quarter of 2023, 146 hedge funds in the database of Insider Monkey held stakes worth $8.1 billion in Uber Technologies, Inc. (NYSE:UBER), up from 144 in the preceding quarter, with a total value of $7.66 billion.
Here is what RiverPark Advisors said about Uber Technologies, Inc. (NYSE:UBER) in its Q3 2023 investor letter:
“Uber Technologies, Inc. (NYSE:UBER): UBER was the top contributor in the quarter following a better-than-expected 2Q23 earnings report and 3Q23 guidance. Gross bookings of $33.6 billion were up 16% year over year. Mobility gross bookings of $17 billion grew 25% over last year driven by a combination of product innovation and driver availability. Delivery gross bookings of $16 billion were up 12% from last year. 2Q Adjusted EBITDA of $916 million, up $552 million year over year, significantly beat Street estimates of $845 million and the company generated $1.1 billion of free cash flow. Management guided to continuing growth in 3Q Gross Bookings (17%-20% growth) and Adjusted EBITDA (of $975-1,025 million).
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. 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 just ride sharing and food delivery, but also as a global mobility platform with the ability to sell to its 130 million users (by comparison, Amazon Prime has 200 million members) and penetrate new markets of on-demand services, such as package and grocery delivery, travel, and worker staffing for shift work. Given its $4.3 billion of unrestricted cash and $4.4 billion of investments, the company’s enterprise value of $95 billion equates to just over 20x next year’s estimated free cash flow.”
1. NVIDIA Corporation (NASDAQ:NVDA)
Number of Hedge Fund Holders: 180
P/E Ratio: 63.08
Headquartered in Santa Clara, California, Nvidia Corporation (NASDAQ:NVDA) is an American multinational technology company incorporated in Delaware. Widely recognized for its expertise in integrated circuit development, Nvidia’s proficiency spans across a diverse range of devices, from electronic game consoles to personal computers (PCs).
On November 21, NVIDIA Corporation (NASDAQ:NVDA) unveiled its financial results for the third quarter, which concluded on October 29, 2023. The company reported a revenue of $18.12 billion, marking a substantial increase of 206% compared to the same period last year and a notable 34% rise from the previous quarter. In terms of GAAP earnings per diluted share, the quarter recorded $3.71, reflecting a more than 12-fold increase from a year ago and a 50% uptick from the previous quarter. Non-GAAP earnings per diluted share were $4.02, indicating an almost 6-fold rise from a year ago and a 49% increase from the previous quarter.
Insider Monkey’s analysis of hedge fund portfolios for Q3 2023 revealed that 180 hedge funds had a stake in NVIDIA Corporation (NASDAQ:NVDA). Citadel Investment Group emerged as its largest stakeholder, holding approximately 21.85 million shares valued at about $9.5 billion in NVIDIA Corporation (NASDAQ:NVDA).
Baron Opportunity Fund made the following comment about NVIDIA Corporation (NASDAQ:NVDA) in its Q3 2023 investor letter:
“NVIDIA Corporation (NASDAQ:NVDA) is a leading semiconductor company that sells chips and software for accelerated computing and gaming. Shares have nearly tripled year-to-date, as the company continues reporting unprecedented growth because of the acceleration in demand for its data center chips. After reporting revenue of $7 billion in the first quarter and providing guidance of $11 billion for the second quarter, NVIDIA reported second quarter revenue of $13.5 billion and guided for another step up in the third quarter to $16 billion, with its CFO declaring “[d]emand for our Data Center platform for AI is tremendous and broad-based across industries and customers.” We are at the tipping point of a new era of computing with NVIDIA at its epicenter. This is how CEO and founder Jensen Huang put it (during the company’s August 23 earnings call):
“[T]he easiest way to think about the demand is the world is transitioning from general purpose computing to accelerated computing…[W]hat you’re seeing companies do now is recognizing this…tipping point…recognizing the beginning of this transition, and diverting their capital investment to accelerated computing and generative AI…This isn’t a singular application that is driving the demand, but this is a new computing platform…a new computing transitioning that’s happening…A new computing era has begun. The simultaneously going through two platform transitions, accelerated computing and generative AI.””
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