5 Best Stocks That Will Always Grow

In this article, we discuss the 5 best stocks that will always grow. To read the detailed analysis of the current economic landscape, go directly to the 13 Best Stocks That Will Always Grow.

5. PepsiCo, Inc. (NASDAQ:PEP)

1-year Revenue Growth Rate: 4.36%

3-year Revenue Growth Rate: 8.81%

5-year Revenue Growth Rate: 7.17%

Number of Hedge Fund Holders: 64

PepsiCo, Inc. (NASDAQ:PEP) is one of the key players in the beverage industry around the globe due to its many famous brands, including Gatorade, Pepsi-Cola, Mountain Dew, and others.

On April 24, Morgan Stanley “strongly reiterated” PepsiCo, Inc. (NASDAQ:PEP) as its Top Pick with an Overweight rating and a $190 price target. The stock’s revenue grew 7.17% over the past five years and is among the best stocks that will always grow.

64 hedge funds held stakes in PepsiCo, Inc. (NASDAQ:PEP) in the fourth quarter of 2023, with positions worth $4.556 billion. With 6.63 million shares, valued at $1.126 billion, Fundsmith LLP is the biggest shareholder of the company, as of December 31, 2023.

RiverPark Advisors made the following comment about PepsiCo, Inc. (NASDAQ:PEP) in its Q3 2023 investor letter:

“PepsiCo, Inc. (NASDAQ:PEP): PepsiCo is a leading global beverage and snack food company with a portfolio of brands, including Lay’s, Doritos, Cheetos, Gatorade, Pepsi-Cola, Mountain Dew, Quaker and SodaStream. The company, through its operations, authorized bottlers, contract manufacturers and other third parties, makes, markets, distributes and sells a wide variety of beverages and snack foods, serving customers and consumers in more than 200 countries and territories.

PEP, through acquisitions, marketing, and product innovation has reinvigorated top line expansion and is now expected to grow revenues in the mid-single digit percent rate for the foreseeable future. We expect this revenue growth to drive margin expansion and free cash flow growth from $5.6 billion in 2022 to $12.3 billion in 2028. Based on this more than doubling of free cash flow and the company’s 2.8% dividend yield, we believe we can achieve double digit rates of return from the stock regardless of the economic environment ahead. We initiated a small position in August.”

4. NextEra Energy, Inc. (NYSE:NEE)

1-year Revenue Growth Rate: 9.47%

3-year Revenue Growth Rate: 16.61%

5-year Revenue Growth Rate: 9.87%

Number of Hedge Fund Holders: 65

NextEra Energy, Inc. (NYSE:NEE) is a major player in the utilities industry, and its subsidiary, Florida Power & Light, has a near monopoly in Florida as it is the largest rate-regulated utility in the state. At a stake value of $9.59 billion, 65 hedge funds held positions in NextEra Energy, Inc. (NYSE:NEE). As of Q4 of 2023, Two Sigma Advisors is the largest shareholder in the company and has a position worth $237.208 million.

Over the past 5 years, the company’s revenue increased 9.87%. On April 22, Scotiabank raised the price target on NextEra Energy, Inc. (NYSE:NEE) to $73 from $69 and maintained an Outperform rating on the shares.

ClearBridge Investments stated the following regarding NextEra Energy, Inc. (NYSE:NEE) in its fourth quarter 2023 investor letter:

“We added a new position in NextEra Energy, Inc. (NYSE:NEE), in the utilities sector, which acquires, owns and manages contracted clean energy projects in the U.S. The company was at the center of the defensive stock storm when it slowed its renewable growth outlook modestly in late September, and the stock collapsed almost 30% in less than two weeks. We saw this as an opportunity to invest in arguably the best combination of a regulated utility and an experienced renewable operator with good long-term growth options. Even at a much-reduced estimated growth rate from higher financing costs, which will likely prove to be conservative, our estimate of intrinsic business value is materially higher.”

3. Intuitive Surgical, Inc. (NASDAQ:ISRG)

1-year Revenue Growth Rate: 13.81%

3-year Revenue Growth Rate: 17.16%

5-year Revenue Growth Rate: 13.71%

Number of Hedge Fund Holders: 82

Intuitive Surgical, Inc. (NASDAQ:ISRG) is a dominant player in the surgical robotics market owing to its Da Vinci Surgical Systems. The company’s revenue increased 13.71% in the last five years.

On April 18, Intuitive Surgical, Inc. (NASDAQ:ISRG) reported first-quarter earnings. The non-GAAP EPS reported was $1.50, which beat the market estimates by $0.08. The revenue climbed 11.8% year-over-year to $1.89 billion, which topped the estimates by $20 million.

Intuitive Surgical, Inc. (NASDAQ:ISRG) was part of 82 hedge funds’ portfolios in the fourth quarter of 2023 with a total stake value of $6.087 billion. Fisher Asset Management is the most prominent shareholder in the company and has a position worth $1.51 billion as of the fourth quarter of 2023. The company is among the best stocks that will always grow.

Baron Health Care Fund mentioned Intuitive Surgical, Inc. (NASDAQ:ISRG) in its first quarter 2024 investor letter:

“Intuitive Surgical, Inc. (NASDAQ:ISRG) sells the da Vinci surgical robotic system for minimally invasive surgical procedures. The stock rose after the company announced the planned launch of the da Vinci 5, its next-generation, multiport robotic system. The new system has 10,000 times the computing power of its predecessor and features over 150 design upgrades such as force feedback, improved visualization, and productivity enhancements. Intuitive plans to launch the device at a small number of customers in the U.S. before releasing it more broadly. We think the da Vinci 5 will enable Intuitive to continue to generate strong revenue and earnings growth and maintain its competitive edge.”

2. Eli Lilly and Company (NYSE:LLY)

1-year Revenue Growth Rate: 19.56%

3-year Revenue Growth Rate: 11.62%

5-year Revenue Growth Rate: 9.69%

Number of Hedge Fund Holders: 102

Eli Lilly and Company (NYSE:LLY) is a major player in the insulin market. Eli Lilly and Company (NYSE:LLY) was held by 102 hedge funds in Q4 of 2023 with stakes worth $11.18 billion. Fisher Asset Management is the most significant shareholder of the company and has a position worth $2.6 billion as of Q4 of 2023.

Eli Lilly and Company’s (NYSE:LLY) revenue increased 9.69% in the past five years. On April 12, Leerink reiterated an Outperform rating on the stock with an $821 price target.

Baron Funds stated the following regarding Eli Lilly and Company (NYSE:LLY) in its first quarter 2024 investor letter:

“Eli Lilly and Company (NYSE:LLY) is a global pharmaceutical company that discovers, develops, manufactures, and sells medicines in the categories of diabetes, oncology, neuroscience, and immunology, among other areas. Stock performance was strong due to robust fourth quarter sales of Mounjaro/ Zepbound, better-than-anticipated initial guidance for fiscal year 2024, and ongoing enthusiasm surrounding the company’s obesity and diabetes franchises. We continue to think Lilly is well positioned to grow revenue and earnings at attractive rates through the end of the decade and beyond.”

1. UnitedHealth Group Incorporated (NYSE:UNH)

1-year Revenue Growth Rate: 12.96%

3-year Revenue Growth Rate: 13.01%

5-year Revenue Growth Rate: 10.40%

Number of Hedge Fund Holders: 113

UnitedHealth Group Incorporated (NYSE:UNH) is one of the few major players in the health insurance market. The stock tops our list of the best stocks that will always grow and its revenue increased by 10.40% over the last five years.

On April 16, UnitedHealth Group Incorporated (NYSE:UNH) announced first-quarter earnings. The non-GAAP EPS reported was $6.91, which surpassed the estimates by $0.29. The revenue surged 8.6% year-over-year to $99.79 billion and beat the estimates by $490 million.

According to our database, 113 hedge funds held stakes in UnitedHealth Group Incorporated (NYSE:UNH) with positions worth $11.12 billion in the fourth quarter of 2023. GQG Partners is the biggest shareholder of the company, as of December 31, 2023, and has a position worth $1.8 billion.

Baron Funds stated the following regarding UnitedHealth Group Incorporated (NYSE:UNH) in its first quarter 2024 investor letter:

“UnitedHealth Group Incorporated (NYSE:UNH) is a leading health insurance company that operates across four segments: United Healthcare, Optum Health, OptumInsight, and OptumRX. Shares fell alongside other managed care organizations (MCOs) due to patient utilization of Medicare Advantage (MA) that was higher than consensus forecasts, raising concerns that MCOs had mispriced 2024 bids and could suffer margin compression as a result. In addition, the industry is facing headwinds from MA reimbursement cuts and Star Rating changes. While management said higher cost trends are mostly transitory and reflected in its bidding, and 2024 guidance was roughly in line with consensus, investors took a more cautious wait-and-see approach. We believe UnitedHealth should remain a core portfolio holding, as it is a way to play positive demographic, population health, and value-based reimbursement trends. Despite its size, we think the company should be able to grow earnings consistent with its 13% to 16% long-term EPS annual target, the fastest among major MCOs.”

Should you invest $1,000 in UnitedHealth Group Incorporated (NYSE:UNH) right now?

Before you buy stock in UNH, consider this:

The Insider Monkey Quarterly Newsletter just identified what we believe are the 14 best stocks for investors to buy now… and UNH wasn’t one of them. The 14 stocks that made the cut could produce monster returns in the next few months.

Quarterly Newsletter is your easy-to-follow blueprint for building a winning portfolio.  It includes stock picks from billionaires, regular updates from hedge fund investor letters, and 14 fresh stock picks each quarter. The Quarterly Newsletter service has more than doubled the return of S&P 500 since 2014.

See the 14 stocks

Disclosure: None. You can also look at the 14 Best Financial Sector Dividend Stocks To Invest In and the 15 Most Competitive Countries in Europe.

Insider Monkey focuses on uncovering the best investment ideas of hedge funds and investors. Please subscribe to our daily free newsletter to get the latest investment ideas from hedge funds’ investor letters by entering your email address below.