In this article, we will take a look at the 5 best socially responsible stocks to buy according to analysts. To see more such companies, go directly to 10 Best Socially Responsible Stocks to Buy According to Analysts.
5. NVIDIA Corporation (NASDAQ:NVDA)
Number of Hedge Fund Holders: 106
Analyst Price Target: $355
NVIDIA Corporation (NASDAQ:NVDA) has pledged to use advanced technologies to fight the climate change problem. NVIDIA Corporation (NASDAQ:NVDA) has also cut its emissions by 15% per employee. Nvidia plans to source 65% of its global electricity from renewable sources by 2025. It is a key part of the Vanguard FTSE Social Index Fund.
According to CNN Business, NVIDIA Corporation (NASDAQ:NVDA)’s median price target set by analysts is $355, which presents a strong upside to its current stock price of $277. Hedge fund sentiment for NVIDIA Corporation (NASDAQ:NVDA) saw a huge jump in the fourth quarter, with 106 funds tracked by Insider Monkey reporting stakes in the company at the end of the period, up from 89 funds in the previous quarter.
Aristotle Atlantic Focus Growth Strategy made the following comment about NVIDIA Corporation (NASDAQ:NVDA) in its Q1 2023 investor letter:
“NVIDIA Corporation (NASDAQ:NVDA) contributed to outperformance, as the company announced better-than-expected fourth quarter earnings driven by a strong rebound in Gaming and an improving outlook for the Datacenter business due to the acceleration of Graphics Processing Unit (GPU) driven Artifical Intelligence (AI) deployment. The company also hosted its Global Technology Conference (GTC) in March where it further highlighted its leading technology being used to develop AI Large Language Models (LLM). The company announced new partnerships with hyperscalers for its AI cloud-based service while also releasing new software and hardware offerings that will support GPU-driven AI growth. Nvidia continues to see a growing addressable market for its products and services as AI uses become more prevalent.”
4. UnitedHealth Group Inc. (NYSE:UNH)
Number of Hedge Fund Holders: 110
Analyst Price Target: $600
UnitedHealth Group Inc. (NYSE:UNH) ranks 4th in our list of the best socially responsible stocks to buy according to analysts. UnitedHealth Group Inc. (NYSE:UNH)’s ESG risk score is 15.3, according to Sustainalytics, which comes under the low risk category. UnitedHealth Group Inc. (NYSE:UNH)’s median price target is $600, which presents an attractive upside potential from the current levels.
As of the end of the fourth quarter of 2022, 110 hedge funds tracked by Insider Monkey had stakes in UnitedHealth Group Inc. (NYSE:UNH). The biggest hedge fund stakeholder of UnitedHealth Group Inc. (NYSE:UNH) is GQG Partners of Rajiv Jain which owns a $2 billion stake in the company.
Polen Focus Growth Strategy made the following comment about UnitedHealth Group Incorporated (NYSE:UNH) in its Q1 2023 investor letter:
“UnitedHealth Group Incorporated (NYSE:UNH) was our largest absolute detractor, declining by over 10% in the quarter. Besides healthcare as a sector coming under pressure in the quarter, we believe there was some additional pressure on the shares from the February advance release of 2024 Medicare rates for Medicare Advantage health plans. In the preview, CMS (Center for Medicare and Medicaid Services) announced Medicare rates would come in well below most people’s assumptions, which could pressure the profits of Medicare managed care providers like UnitedHealth, who also face inflationary medical cost pressures. After quarter end though, CMS adjusted those rates a bit higher. On the announcement, UnitedHealth has recouped most of its modest decline from the original announcement.
While CMS rate rules are important for companies like UnitedHealth, we believe the company is far better positioned than its peers to be able to mitigate any rate pressure or medical cost inflation. We believe this is due to its scale advantages and its other, higher-profit-margin businesses like Optum Insight, its data and analytics business, and its larger Optum Health business, where it operates the medical practices of primary care providers on a national basis.”
3. Visa Inc. (NYSE:V)
Number of Hedge Fund Holders: 177
Analyst Price Target: $300
A strong ESG score and investments in the ESG space makes Visa Inc. (NYSE:V) a key part of the Vanguard FTSE Social Index Fund.
Recently, Visa Inc. (NYSE:V) posted strong fiscal second quarter results. Adjusted EPS in the period came in at $2.09, beating estimates by $0.10. Revenue in the quarter jumped 11.1% year over year to reach $8 billion, beating estimates by $210 million.
Visa Inc. (NYSE:V)’s median price target is $300, which shows the stock has a lot of room to run in the next 12 months.
A total of 177 hedge funds tracked by Insider Monkey had stakes in Visa Inc. (NYSE:V) as of the end of the fourth quarter of 2022, up from 165 funds in the previous quarter. This shows hedge fund sentiment for Visa Inc. (NYSE:V) gained in the last quarter of 2022.
Polen Global Growth Strategy made the following comment about Visa Inc. (NYSE:V) in its Q1 2023 investor letter:
“We trimmed Mastercard and Visa Inc. (NYSE:V) to equal weights of the Portfolio. Mastercard and Visa operate as a duopoly in a large and growing market. Over the last 50 years, global personal consumer expenditures (PCE) has grown 7-9% annualized. We expect 4-5% long-term PCE growth going forward. Additionally, the shift from cash to credit continues unabated, with a total credit penetration of only approximately 50% globally.3 This shift provides Visa and Mastercard with another ~4-6% of growth. When combined with PCE, this gives both companies high-single-digit to low-double[1]digit revenue growth opportunities. This growth estimate is before accounting for growth amplifiers like the acceleration of e[1]commerce, the shift from offline to online, and additional services. Both companies enjoy extremely strong network effects that provide strong competitive advantages.
We have trimmed Visa and Mastercard because their combined weight grew to over 12% of the Global Growth Portfolio because of their recent performance and to fund our increase in Amazon’s position size. We added to both positions when their prices were depressed due to cross-border transactions deteriorating materially from the pandemic. Cross-border volumes came roaring back when travel corridors reopened, and although we are several quarters removed from the cross-border nadir, Visa still grew volumes >30% in 1Q23. Total cross-border volumes are now 132% of 2019 levels. At 4.5% each, both companies remain high conviction positions for Global Growth.”
2. Alphabet Inc. (NASDAQ:GOOG)
Number of Hedge Fund Holders: 209
Analyst Price Target: $130
Alphabet Inc. (NASDAQ:GOOG) is famous for investing heavily into the ESG space and environment-related projects. Last year Alphabet Inc. (NASDAQ:GOOG) revaled its plans to invest $5.75 billion in ESG-related initiatives.
A total of 209 hedge funds tracked by Insider Monkey were long Alphabet Inc. (NASDAQ:GOOG) as of the end of the fourth quarter of 2022. The biggest hedge fund stakeholder of Alphabet Inc. (NASDAQ:GOOG) is TCI Fund Management of Chris Hohn which owns a $5 billion stake in the company.
Polen Focus Growth Strategy made the following comment about Alphabet Inc. (NASDAQ:GOOG) in its Q1 2023 investor letter:
“One area we are watching regarding Alphabet Inc. (NASDAQ:GOOG) and Adobe is AI systems and their capabilities, including generative AI. Interestingly, both Adobe and Alphabet could see benefits or threats from the emergence of generative AI and large language models (LLMs). Both companies already use generative AI to the benefit of their users in anticipating how content creators edit their work (Adobe) and in how search results are anticipated and generated (Google). At the same time, breakthrough technologies like AI can open the door to additional competition and/or impact a company’s profitability levels. We now see AI systems others are developing, including LLMs and generative AI offerings, that could be more competitive in the future. While we think it remains early days for ChatGPT and the capabilities of these types of LLMs and generative AI programs like DALL-E, the technology seems to be progressing at a fast rate and will at least require a strong response from incumbents.
As of now, we believe Alphabet and Adobe are leaders in their own right in these areas and have a clear path to improving their existing offerings with AI advancements, which would allow them to be net beneficiaries of AI. There are also significant barriers to building leading AI offerings in these areas. As a result, our position sizes in Adobe and Alphabet remain sizeable. For Adobe, the status of its pending $20 billion-plus Figma acquisition is also uncertain. There is a good chance, in our view, that it will be blocked by regulators, which would mean the future opportunity to expand its offerings to the developer community (beyond designers) may not occur.”
1. Microsoft Corporation (NASDAQ:MSFT)
Number of Hedge Fund Holders: 259
Analyst Price Target: $304
Microsoft Corporation (NASDAQ:MSFT) has secured solid ESG ratings from several independent agencies because of its investments in the ESG space and sustainable business practices. Microsoft Corporation (NASDAQ:MSFT)’s average analyst price target is $304, which shows a strong upside potential from the current levels. Microsoft Corporation (NASDAQ:MSFT)’s ESG risk score is 15, which comes under the low risk category.
As of the end the fourth quarter of 2022, Microsoft Corporation (NASDAQ:MSFT) was the most popular stock among the 943 hedge funds tracked by Insider Monkey. The biggest hedge fund stakeholder of Microsoft Corporation (NASDAQ:MSFT) during the period after Bill & Melinda Gates Foundation was TCI Fund Management of Chris Hohn.
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