In this article, we will take a look at the 5 best stocks to buy on Robinhood for beginners. To see more such companies, go directly to 11 Best Stocks to Buy on Robinhood for Beginners.
5. Tesla, Inc. (NASDAQ:TSLA)
Number of Hedge Fund Holders: 91
Tesla, Inc. (NASDAQ:TSLA) is one of the most popular stocks among both retail investors and hedge funds. We recently reported in our list of the most promising car stocks how analysts are growing bullish on Tesla, Inc. (NASDAQ:TSLA) for the long term on the back of new growth catalysts. On average, analysts have a price target of around $196 on Tesla, Inc. (NASDAQ:TSLA). Cathie Wood, one of the biggest stakeholders of Tesla, Inc. (NASDAQ:TSLA), believes the stock could hit $500 by 2026.
At the end of the fourth quarter of 2022, 91 hedge funds had stakes in Tesla, Inc. (NASDAQ:TSLA). The net worth of these stakes was about $6 billion. The biggest stakeholder of Tesla, Inc. (NASDAQ:TSLA) was Ken Griffin of Citadel Investment Group with a $926 million stake.
ClearBridge Large Cap Growth Strategy made the following comment about Tesla, Inc. (NASDAQ:TSLA) in its Q4 2022 investor letter:
“Tesla, Inc. (NASDAQ:TSLA), meanwhile, also fits squarely within our earnings reset group. We took advantage of its enterprise multiple falling back to historic lows to initiate a starter position in the leading manufacturer of electric vehicles (EV) and developer of battery technologies. Tesla has a significant structural cost advantage in battery production, EV manufacturing and EV selling, which gives it industry-leading operating margins in EVs. As the auto cycle has softened, the stock has sold off substantially with the rest of the automakers, despite EVs continuing to have a secular growth advantage. Tesla has a clean balance sheet with negative net debt and enormous revenue growth, EBITDA growth and free cash flow generation. Its margin buffer also gives the company the ability to cut prices while still protecting earnings better than competitors, which should help support continued volume growth. There is also significant upside optionality driven by its software offerings, which we do not believe is currently priced into the stock.
That being said, Tesla is highly indexed to a flagging auto market and we expect its earnings outlook to worsen in the near term. We are also monitoring increasing EV competition and the recently emerging risks to the brand and management integrity raised by CEO Elon Musk’s actions at Twitter to determine future position size in the portfolio.”
4. The Walt Disney Company (NYSE:DIS)
Number of Hedge Fund Holders: 99
Entertainment giant The Walt Disney Company (NYSE:DIS) has been gaining investors’ attention in 2023 amid the return of Bob Iger and the steps he’s taking to turn the company around. Recently, The Wall Street Journal reported that most of the Disney+ subscribers kept using the service despite the recent $3 per month price increased. This shows there’s more room for price increases in the future.
As of the end of the fourth quarter of 2022, 99 hedge funds had stakes in The Walt Disney Company (NYSE:DIS). The biggest stakeholder of The Walt Disney Company (NYSE:DIS) during this period was Nelson Peltz’s Trian Partners which has a $785 million stake.
ClearBridge All Cap Growth Strategy made the following comment about The Walt Disney Company (NYSE:DIS) in its Q4 2022 investor letter:
“We exited The Walt Disney Company (NYSE:DIS) to focus on areas of the media industry with better risk/reward. Disney has significant exposure to consumer spending that is showing early signs of weakening. We decided to move on from the name as its traditional linear programming business is dissolving more quickly than expected, while its Disney+ streaming business cannot offset the affiliate fees and advertising revenue that the company has relied on for years. Disney’s parks business has done well recently due to strong pricing power but we have concerns that consumers will continue to spend on such discretionary purchases in a recessionary environment. At this point in the cycle, we believe Netflix has more ways to innovate and improve profitability.”
3. Alibaba Group Holding Limited (NYSE:BABA)
Number of Hedge Fund Holders: 113
Retail investors are piling into Alibaba Group Holding Limited (NYSE:BABA) on Robinhood. But hedge funds and institutional investors also like Alibaba Group Holding Limited (NYSE:BABA) for long-term growth. Recently, J.P. Morgan Asset Management launched its China-focused ETF, JPMorgan Active China ETF (NYSEARCA:JCHI). The ETF, according to the bank, offers “best ideas” portfolio of Chinese equities. Alibaba Group Holding Limited (NYSE:BABA) is one of the notable holdings of this ETF.
As of the end of the fourth quarter of 2022, 113 hedge funds had stakes in Alibaba Group Holding Limited (NYSE:BABA), up from 105 hedge funds in the previous quarter. The total value of these stakes was about $5.6 billion. The biggest stakeholder of Alibaba Group Holding Limited (NYSE:BABA) was Philippe Laffont’s Coatue Management.
Artisan Global Equity Fund made the following comment about Alibaba Group Holding Limited (NYSE:BABA) in its Q4 2022 investor letter:
“Finally, within our technology theme, an area that we have trimmed heavily over the year, we exited Alphabet due to deteriorating fundamentals and reinitiated a position in Alibaba Group Holding Limited (NYSE:BABA), a stock we have owned previously, as it enters a new phase in its history, one most likely without founder Jack Ma after he became a lightning rod for the Chinese government’s technology crackdown beginning in late 2020. We are attracted to the company’s secular growth prospects in online and mobile commerce.”
2. Apple Inc. (NASDAQ:AAPL)
Number of Hedge Fund Holders: 135
Apple Inc. (NASDAQ:AAPL) is one of the best stocks to buy on Robinhood for beginners. It is also a favorite of Wall Street analysts. Recently, Gene Munster, managing partner at Deepwater Asset Management, said in an interview with CNBC that Apple Inc. (NASDAQ:AAPL) is “probably the safest place to be” amid the current market turmoil. The analyst also praised Apple Inc. (NASDAQ:AAPL)’s performance compared to other major tech companies. The analyst continues to believe that tech stocks will start recovering in the second half of 2023 and will have a “great year” in 2024. Earlier this year the analyst gave a $250 price target for Apple Inc. (NASDAQ:AAPL).
At the end of the fourth quarter of 2022, 135 hedge funds had stakes in Apple Inc. (NASDAQ:AAPL). The biggest stakeholder of Apple Inc. (NASDAQ:AAPL) was Warren Buffett’s Berkshire Hathaway which owns an $116 billion stake in the company.
Here is what Distillate Capital has to say about Apple Inc. (NASDAQ:AAPL) in its Q3 2022 investor letter:
“The largest new purchase was Apple Inc. (NASDAQ:AAPL), which after underperforming saw its valuation improve significantly. Over the course of the last year, Apple’s consensus estimated forward free cash flows rose modestly, while its enterprise value fell by around 30%. Apple ranks below the 25th most attractive name in the portfolio and so its weight is capped at 4% vs. 6% for names in the top quartile.”
1. Microsoft Corporation (NASDAQ:MSFT)
Number of Hedge Fund Holders: 259
Microsoft Corporation (NASDAQ:MSFT) is one of the best stocks to buy for beginners on Robinhood.
Recently, Evercore ISI increased its price target on Microsoft Corporation (NASDAQ:MSFT) to $295 from $280.
Microsoft Corporation (NASDAQ:MSFT) has been gaining attention in 2023 amid the AI mania. Microsoft Corporation (NASDAQ:MSFT) continues to integrate ChatGPT with its tools and apps.
Microsoft Corporation (NASDAQ:MSFT) is also the most popular stock among the 943 hedge funds tracked by Insider Monkey. A total of 259 hedge funds in Insider Monkey’s database had stakes in Microsoft Corporation (NASDAQ:MSFT). The biggest stakeholder of Microsoft Corporation (NASDAQ:MSFT) after Bill & Melinda Gates Foundation was TCI Fund Management of Chris Hohn which had a $5.3 billion stake.
Ariel Global Strategy made the following comment about Microsoft Corporation (NASDAQ:MSFT) in its Q4 2022 investor letter:
“Enterprise software provider Microsoft Corporation (NASDAQ:MSFT) also traded lower, as higher interest rates and economic concerns have created headwinds for growth-oriented technology companies. We believe this price action runs counter to Microsoft’s solid fundamentals, competitive positioning and long-term business outlook. We continue to anchor on the company driving value creation by capitalizing on a broad and deep set of opportunities, most notably within hybrid cloud infrastructure. The platform continues to demonstrate share gains and strong multi-year purchase intent as enterprises transition to cloud based platforms. At current trading levels, we believe Microsoft’s risk/reward is skewed to the upside.”
You can also take a peek at 15 Most Promising Dividend Stocks According to Analysts and 15 Most Promising Long-Term Stocks.
