This article presents an overview of the 5 Stocks to Buy at a Discount Now. For a detailed overview of such stocks, read our article, 12 Stocks to Buy at a Discount Now.
5. ON Semiconductor Corp (NASDAQ:ON)
Number of Hedge Fund Investors: 53
With a low PE ratio, 9% YTD decline in stock price and positive hedge fund sentiment, ON Semiconductor Corp (NASDAQ:ON) ranks fifth in our list of the top stocks to buy at a discount now according to hedge funds.
In November, Goldman Sachs published a list of stocks it recommends to buy on the back of sales growth, balance sheet strength and high return on equity. On Semiconductor made it to the list.
As of the end of the third quarter of 2023, 53 hedge funds out of the 910 funds tracked by Insider Monkey had stakes in ON Semiconductor Corp (NASDAQ:ON). The biggest stakeholder of ON Semiconductor Corp (NASDAQ:ON) was Ken Griffin’s Citadel Investment Group which owns a $232 million stake in ON Semiconductor Corp (NASDAQ:ON).
ClearBridge Sustainability Leaders Strategy made the following comment about ON Semiconductor Corporation (NASDAQ:ON) in its Q2 2023 investor letter:
“To fund our purchase of Lam Research, we exited ON Semiconductor Corporation (NASDAQ:ON), preferring Lam at this point in the semiconductor cycle, and as we are also cautious on automotive demand, a key end market for ON Semiconductor.”
4. Caesars Entertainment Inc (NASDAQ:CZR)
Number of Hedge Fund Investors: 56
Casino and entertainment company Caesars Entertainment Inc (NASDAQ:CZR) ranks fourth in our list of the best stocks to buy at a discount according to hedge funds. Earlier this month, JMP started covering the stock with a Market Perform rating as it expects the stock to rise due to strengths in its brick-and-mortar casinos.
As of the end of the third quarter of 2023, 56 hedge funds out of the 910 funds tracked by Insider Monkey had stakes in Caesars Entertainment Inc (NASDAQ:CZR).
Baron Real Estate Fund stated the following regarding Caesars Entertainment, Inc. (NASDAQ:CZR) in its fourth quarter 2023 investor letter:
“In the most recent quarter, we acquired additional shares in Caesars Entertainment, Inc. (NASDAQ:CZR), the largest casino-entertainment company in the U.S. and one of the world’s most diversified casino-entertainment providers. We are big fans of CEO Tom Reeg and remain optimistic about the long-term prospects for the company.
The company operates primarily under the Caesars, Harrah’s, Horseshoe, and Eldorado brand names. The company generates approximately 50% of its cash flow from Las Vegas and 50% from regional destination markets. The company owns approximately half of its real estate and leases the other half from gaming REIT companies – Gaming and Leisure Properties, Inc. and VICI Properties Inc…” (Click here to read the full article)
3. Charter Communications Inc (NASDAQ:CHTR)
Number of Hedge Fund Investors: 73
Charter Communications Inc (NASDAQ:CHTR) has a PE ratio of 11.9 as of January 16. The stock has lost about 6.8% year to date through December 16.
As of the end of the third quarter of 2023, 73 hedge funds tracked by Insider Monkey had stakes in Charter Communications Inc (NASDAQ:CHTR). The most significant stakeholder of Charter Communications Inc (NASDAQ:CHTR) was Natixis Global Asset Management’s Harris Associates which owns a $2.3 billion stake in Charter Communications Inc (NASDAQ:CHTR).
Here is what Weitz Conservative Allocation Fund has to say about Charter Communications, Inc. (NASDAQ:CHTR) in its Q3 2023 investor letter:
“We swapped the Fund’s Liberty Broadband Corporation (NASDAQ:LBRDK) shares back to Charter Communications, Inc. (NASDAQ:CHTR) (Charter is by far Liberty Broadband’s largest asset), and the combined position was the most notable quarterly contributor. Investor sentiment around broadband’s competitive position became less negative, and the stocks rebounded nicely from what we considered oversold levels.”
2. Teck Resources Ltd Class B (NYSE:TECK)
Number of Hedge Fund Investors: 75
Canadian-based natural resources company Teck Resources Ltd Class B (NYSE:TECK) ranks second in our list of the best stocks to buy at a discount now. The stock is down by about 7.1% in 2024 so far through January 16.
As of the end of the third quarter of 2023, 75 hedge funds out of the 910 funds tracked by Insider Monkey had stakes in Teck Resources Ltd Class B (NYSE:TECK).
1. Alibaba Group Holding Ltd – ADR (NYSE:BABA)
Number of Hedge Fund Investors: 110
Alibaba Group Holding Ltd – ADR (NYSE:BABA) has been struggling amid an unfriendly business environment in China and the rise of competitors in the country. But many analysts believe the stock will rebound thanks to its long-term growth catalysts and size of ecommerce operations. In December, Baird analyst Colin Sebastian said Alibaba Group Holding Ltd – ADR (NYSE:BABA) could be one of the stocks to benefit in 2024 due to AI and increased operating efficiencies. The analyst, however, decreased his price target on the stock to $95.
The analyst said some catalysts for Alibaba Group Holding Ltd – ADR (NYSE:BABA) are “ecommerce competition, corporate reorganization, shareholder returns, [generative AI] initiatives, and Alicloud trends.”
L1 Long Short Fund made the following comment about Alibaba Group Holding Limited (NYSE:BABA) in its second quarter 2023 investor letter:
“Alibaba Group Holding Limited (NYSE:BABA) (Long -18%) shares weakened in recent months as Chinese reopening strength faded and macro-economic datapoints began sequentially declining. Nevertheless, we believe the Chinese government will use consumption as a key lever to reinvigorate the economy post-COVID lockdowns. Alibaba remains a high-quality business with leading positions in both eCommerce and Public Cloud, and management is taking proactive steps to unlock shareholder value. It has announced plans to split into six major business groups – Cloud Intelligence, Taobao Tmall, Local Services, Global Digital, Cainiao Smart Logistics and Digital Media, and Entertainment Group. Each group will be managed independently, with a separate CEO and board, have the flexibility to raise external capital and potentially pursue separate IPOs. We believe this restructure will be a strong positive catalyst to unlock the sum-of-the-parts valuation upside in the company.”
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