In this article, we discuss the 5 best low risk stocks to buy now. If you want to read our detailed analysis of these stocks, go directly to the 10 Best Low Risk Stocks to Buy Now.
5. The Procter & Gamble Company (NYSE:PG)
Number of Hedge Fund Holders: 68
The Procter & Gamble Company (NYSE:PG) is one of the most stable stocks on the market. The company markets consumer packaged goods. Bank of America analyst Bryan Spillane recently initiated coverage of the stock with a Buy rating and a price target of $160, noting that bigger brands were adapting better to market dynamics than smaller ones in the direct-to-consumer capability.
On October 20, The Procter & Gamble Company (NYSE:PG) declared a quarterly dividend of $0.8698 per share, in line with previous. The firm beat market expectations on earnings per share by $0.02 in the first fiscal quarter results posted a day earlier.
Among the hedge funds being tracked by Insider Monkey, London-based investment firm Cedar Rock Capital is a leading shareholder in The Procter & Gamble Company (NYSE:PG) with 7.5 million shares worth more than $1 billion.
4. Bristol-Myers Squibb Company (NYSE:BMY)
Number of Hedge Fund Holders: 73
Bristol-Myers Squibb Company (NYSE:BMY) makes and sells biopharmaceutical products. It operates from New York. The company recently posted earnings for the third quarter, reporting earnings per share of $2, beating market estimates by $0.08. The revenue over the period was $11.6 billion, up 10% year-on-year and beating market predictions by $100 million. The firm also raised guidance numbers for the fiscal year in the earnings report.
Citi analyst Andrew Baum has a Buy rating on Bristol-Myers Squibb Company (NYSE:BMY) stock with a price target of $73. In an investor note, Baum has said that reports that the firm is looking to acquire Aurinia Pharmaceuticals make “sense” in terms of commercial synergies.
At the end of the second quarter of 2021, 73 hedge funds in the database of Insider Monkey held stakes worth $4.5 billion in Bristol-Myers Squibb Company (NYSE:BMY), down from 81 in the preceding quarter worth $5.7 billion.
In its Q4 2020 investor letter, Wedgewood Partners, an asset management firm, highlighted a few stocks and Bristol-Myers Squibb Company (NYSE:BMY) was one of them. Here is what the fund said:
“Bristol-Myers Squibb recently reported accelerating sales as much of the medical services industry returned to work. The Company continues to expect double-digit earnings growth over the next few years, driven by existing drugs, in addition to a broad pipeline of new drugs and indications. While the market remains fixated on a couple of patent expirations that could occur over the next several years, we think this is well-known at this point, yet the market still undervalues a couple of key acquisitions the Company has made in the past few years, particularly Celgene, which was acquired for a song.”
3. Merck & Co., Inc. (NYSE:MRK)
Number of Hedge Fund Holders: 79
Merck & Co., Inc. (NYSE:MRK) is another healthcare giant that features on our list of the best low risk stocks to buy now. The company markets a range of healthcare products that are likely to provide investors with plenty of cover in case of economic upheaval. The firm recently entered into an agreement with Gilead Sciences for trials of a new drug for the treatment of breast cancer patients.
On October 22, investment advisory SVB Leerink maintained an Outperform rating on Merck & Co., Inc. (NYSE:MRK) stock and raised the price target to $105 from $104. Daina Graybosch, an analyst at the firm, issued the ratings update.
Among the hedge funds being tracked by Insider Monkey, Washington-based investment firm Fisher Asset Management is a leading shareholder in Merck & Co., Inc. (NYSE:MRK) with 10.3 million shares worth more than $802 million.
In its Q1 2021 investor letter, Artisan Partners highlighted a few stocks and Merck & Co., Inc. (NYSE:MRK) was one of them. Here is what the fund said:
“In Q1, we initiated a position in Merck, a provider of health care solutions including prescription medicines, vaccines, biologic therapies, animal health and consumer care products. We purchased Merck when the stock came under pressure in part on concerns that the newly minted Biden administration could implement regulatory changes and lower drug costs in the pharmaceutical industry. Recent, but anticipated changes to Merck’s management team have also weighed on shares, as have concerns over the company’s heavy reliance on immunotherapy treatment Keytruda. Notably, Merck is not getting much credit from investors for the 60+ programs it has in clinical development, despite having several solid and large new product opportunities. Additionally, the company’s strong balance sheet and robust free cash flow provide it multiple options for future partnerships and acquisitions. While Merck is undergoing a period of transition, we think the company’s fundamentals are strong and believe changes to management should be a catalyst for improvement.”
2. Johnson & Johnson (NYSE:JNJ)
Number of Hedge Fund Holders: 88
On October 21, health authorities in the United States granted approval to the COVID-19 booster shots developed by Johnson & Johnson (NYSE:JNJ) and Moderna. The booster shots were approved for people aged 18 years or older who were administered the initial vaccine dose about two months ago. The same day, the company had declared a quarterly dividend of $1.06 per share, in line with previous. The forward yield was 2.6%.
There are other drug-related positives for the firm as well. On October 15, Johnson & Johnson (NYSE:JNJ) had announced that authorities in Canada had granted approval for OPSYNVI, a drug developed by the firm to treat pulmonary arterial hypertension.
At the end of the second quarter of 2021, 88 hedge funds in the database of Insider Monkey held stakes worth $7 billion in Johnson & Johnson (NYSE:JNJ), up from 81 in the previous quarter worth $6.9 billion.
1. T-Mobile US, Inc. (NASDAQ:TMUS)
Number of Hedge Fund Holders: 100
T-Mobile US, Inc. (NASDAQ:TMUS) is perhaps the largest communications company in the world. It is certainly a hedge fund favorite and features among the 20 most popular firms among hedge funds. Wells Fargo analyst Eric Luebchow recently kept an Overweight rating on the shares but lowered the price target to $160 from $170, noting that the recent pullback in share price represented a buying opportunity for investors.
T-Mobile US, Inc. (NASDAQ:TMUS) recently announced that it would be expanding a partnership with Walmart that will see the presence of the firm rise significantly across all Walmart retail stores as well as the online presence.
Among the hedge funds being tracked by Insider Monkey, Greenwich-based investment firm Viking Global is a leading shareholder in T-Mobile US, Inc. (NASDAQ:TMUS) with 7.5 million shares worth more than $1 billion.
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