10 Stocks to Buy When Everyone is Selling

Published May 23, 2022 at 10:32 am EDT Updated September 7, 2026 at 2:11 pm EDT

In this article, we discuss the 10 stocks to buy when everyone is selling.

On May 20, the benchmark S&P 500 Index fell 20% from a recent high in January. The index is the broadest measure of the overall health of the market and a 20% fall indicated that the stocks had officially entered a bear market. Traditionally, a bear market represents investor pessimism and brings about a sustained market selloff. However, the panic also presents an opportunity to pick up the shares of companies that have long-term growth potential at bargain prices. Smart investors, like Warren Buffett, have historically benefited from bear markets.

At the annual shareholder meeting of Berkshire Hathaway, Buffett touched on some of the bets that his company had made in the past few months as the market slumped. The legendary value investor, who holds over $150 billion in cash for these “situations”, revealed that he had spent nearly $51 billion on equities in the first three months of 2022. As a result, the cash stake of his company was reduced to around $106 billion. Buffett assured investors that the cash stockpile would grow again as Berkshire has stakes in many cash-generating firms.

The stock market activity of Buffett is representative of the mindset of the hedge fund industry in general. Apart from value investors like Buffett, famous growth bulls like Brad Gerstner have also urged investors to buy stocks that could be “worth more in the future” during the sell-off. Some of the stocks that hedge funds think will provide investors with handsome returns in the long-term include Meta Platforms, Inc. (NASDAQ:FB), Mastercard Incorporated (NYSE:MA), and Apple Inc. (NASDAQ:AAPL).

Our Methodology

The companies that are best positioned to gain value in the future but are trading at a discount due to a weak economy and inflation were selected for the list. The business fundamentals and analyst ratings of these firms are also discussed to provide further context. Hedge fund sentiment was included as a classifier as well. Data from around 900 elite hedge funds tracked by Insider Monkey was used to quantify the hedge fund sentiment around each stock.

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Stocks to Buy When Everyone is Selling

10. BHP Group (NYSE:BHP)

Number of Hedge Fund Holders: 21

BHP Group (NYSE:BHP) is a diversified metals and mining firm. Mike Henry, the CEO of the company, recently stated at a mining conference that supply chain disruptions in the mining sector due to COVID-19 and the Ukraine invasion could take over two years to resolve. As a result of these disruptions, as well as a slash in the reference benchmark rate for mortgages in China, the prices of base metals have surged in the past few days, benefiting the stock. The firm also has an impressive dividend history stretching back thirteen years.

On April 21, Citi analyst Ephrem Ravi upgraded BHP Group stock to Buy from Neutral and raised the price target to GBP 3,200 from GBP 2,750, noting that the cash flow generation of the firm was up strongly due to higher iron prices and was “too much to ignore”.

Among the hedge funds being tracked by Insider Monkey, Washington-based investment firm Fisher Asset Management is a leading shareholder in BHP Group as of Q1 2022, with 16.9 million shares worth more than $1.3 billion.

Just like Meta Platforms, Inc., Mastercard Incorporated, and Apple Inc., BHP Group is one of the stocks that elite investors are buying as the market selloff continues.

In its Q1 2021 investor letter, Harding Loevner, an asset management firm, highlighted a few stocks and BHP Group was one of them. Here is what the fund said:

“Our purchase of Australian mining company BHP Group is an example of a quality company at a moderate valuation that should deliver attractive long-term returns. We believe the market has undervalued its enduring competitive advantage due to its low cost iron and copper mining operations which has allowed the company to deliver consistent profits and cash flows across the inevitable ups and downs of the global metals cycle. While the variability of commodity prices prevents BHP Group from scoring in the top ranks of measured quality, we are willing to bear some of that uncertainty in return for a more attractive valuation given the company’s strong business fundamentals.”

9. Bristol-Myers Squibb Company (NYSE:BMY)

Number of Hedge Fund Holders: 66

Bristol-Myers Squibb Company (NYSE:BMY) develops and sells biopharmaceutical products. The healthcare sector is one of the safest bets in times of uncertainty due to the high percentage of insured population in the United States. The firm can expect to earn around $29 billion through the drugs it markets by 2029 since patents in the health sector are issued for ten years or more. The firm is also one of the largest drug firms in the US where an average citizen spends around 8% of the salary on health insurance.

On May 2, Truist analyst Robyn Karnauskas maintained a Buy rating on Bristol-Myers Squibb Company stock and raised the price target to $81 from $76, noting there was potential upside from expansion opportunities across the drug portfolio of the firm.

At the end of the fourth quarter of 2021, 66 hedge funds in the database of Insider Monkey held stakes worth $3.3 billion in Bristol-Myers Squibb Company, compared to 74 in the previous quarter worth $4.7 billion.

In its Q4 2021 investor letter, Saturna Capital, an asset management firm, highlighted a few stocks and Bristol-Myers Squibb Company was one of them. Here is what the fund said:

“Given the likelihood of rising inflation and interest rates ahead, we anticipate adjustments to the portfolio to reduce exposure to highly valued stocks dependent on low interest rates to support terminal year valuations, while seeking investments in companies more correlated with a return to economic normalcy. We sold our positions in Bristol-Myers Squibb Company. We believe there are better opportunities than Bristol-Myers Squibb Company in pharmaceuticals.”

8. The Coca-Cola Company (NYSE:KO)

Number of Hedge Fund Holders: 70

The Coca-Cola Company (NYSE:KO) makes and sells beverages. The company is one of the most reliable dividend players in the market, with a history of consecutive payouts stretching back close to six decades in a sector where the median in this regard is just two years. In late April, the firm declared a quarterly dividend of $0.44 per share, in line with previous. During the first quarter of 2022, the company grew organic sales by 18% against estimates of 9.5%.

On April 26, Guggenheim analyst Laurent Grandet maintained a Buy rating on The Coca-Cola Company stock and raised the price target to $71 from $68, noting the firm was best placed to benefit from inflation given the pricing power it enjoyed.

Among the hedge funds being tracked by Insider Monkey, Nebraska-based firm Berkshire Hathaway is a leading shareholder in The Coca-Cola Company, with 400 million shares worth more than $23 billion.

In its Q4 2021 investor letter, ClearBridge Investments, an asset management firm, highlighted a few stocks and The Coca-Cola Company was one of them. Here is what the fund said:

“Over the last year, we have repositioned our portfolio to navigate the course we see ahead. We added to more defensive areas of the portfolio like consumer staples (The Coca-Cola Company). While the next month or two will likely prove choppy on account of the Omicron variant, we believe that Omicron, like Delta, represents a speed bump on the way to recovery rather than a true change in course. We see strong economic momentum continuing in 2022 and we expect interest rates to rise. After a decade of remarkably low rates, we would not be surprised if this change in direction is accompanied by some fits and starts in the markets. With our emphasis on pricing power, purposeful sector exposure, valuation discipline, and a strong dividend profile, we believe we are well-positioned for the year ahead.”

7. Johnson & Johnson (NYSE:JNJ)

Number of Hedge Fund Holders: 83

Johnson & Johnson makes and sells healthcare products. The company makes and sells COVID-19 vaccines, putting it in a leading position to benefit from the recent spike in virus cases across the United States. The stock is also trading at around 16% below the record high of $189 it touched almost a month ago. This decline presents an opportunity to buy as the firm posted strong earnings for the first quarter of 2022 recently and has a diversified business that greatly reduces overall risk for the investor in a volatile market.

On April 20, Credit Suisse analyst Matt Miksic kept an Outperform rating on Johnson & Johnson stock and raised the price target to $205 from $200, noting the firm had demonstrated “better-than-expected growth across its MedTech businesses” in the first quarter.

At the end of the fourth quarter of 2021, 83 hedge funds in the database of Insider Monkey held stakes worth $7.3 billion in Johnson & Johnson, compared to 88 in the previous quarter worth $6.8 billion.

6. Thermo Fisher Scientific Inc. (NYSE:TMO)

Number of Hedge Fund Holders: 95

Thermo Fisher Scientific Inc. (NYSE:TMO) markets analytical instruments, specialty diagnostics, and laboratory products. The firm is emerging as a strong dividend player, registering five consecutive years of growth in this regard. Over the past decade, the company has grown revenues by over 200%, or 13.5% annualized. Operating income during the period has improved as well, totaling 23.2% annualized. The gross profits and free cash flows for the company are growing faster than revenues.

In late April, Thermo Fisher Scientific Inc. posted earnings for the first quarter of 2022, reporting earnings per share of $7.25, beating estimates by $1.04. The revenue over the period was $11.8 billion, up over 19% year-on-year.

At the end of the fourth quarter of 2021, 95 hedge funds in the database of Insider Monkey held stakes worth $9.4 billion in Thermo Fisher Scientific Inc., up from 94 in the preceding quarter worth $8.2 billion.

In addition to Meta Platforms, Inc., Mastercard Incorporated, and Apple Inc., Thermo Fisher Scientific Inc. is one of the stocks that smart investors are monitoring in the bear market.

In its Q4 2021 investor letter, ClearBridge Investments, an asset management firm, highlighted a few stocks and Thermo Fisher Scientific Inc. was one of them. Here is what the fund said:

“Improving health remains a key impact theme for the portfolio, and over the past year or so we have increased our exposure to the health care sector, through the addition of Thermo Fisher Scientific Inc., a leading health care tools company, a leading provider of fertility benefit management services to self-insured employers that offers a rare win-win-win for employers, employees, health systems, and doctors, with clear savings and quality improvements.”

5. Alibaba Group Holding Limited (NYSE:BABA)

Number of Hedge Fund Holders: 96

Alibaba Group Holding Limited (NYSE:BABA) is a diversified technology company. The stock has suffered amid a regulatory crackdown in China but latest signs indicate that the crackdown may be easing. Chinese Vice-Premier Liu He recently told top tech executives that the government would “properly manage” the relationship in the battle for key core technologies. COVID lockdowns in China have recently boosted the stock and the firm has been quietly buying back shares to calm investors as well.

On May 16, JPMorgan analyst Alex Yao upgraded Alibaba Group Holding Limited stock to Overweight from Underweight and raised the price target to $130 from $75, noting that the uncertainties facing the Chinese internet stocks were beginning to abate.

Among the hedge funds being tracked by Insider Monkey, Washington-based investment firm Fisher Asset Management is a leading shareholder in Alibaba Group Holding Limited in Q1, with 14.4 million shares worth more than $1.5 billion.

In its Q1 2022 investor letter, Baron Funds, an asset management firm, highlighted a few stocks and Alibaba Group Holding Limited was one of them. Here is what the fund said:

“We have eliminated 6 holdings during the first quarter (including) Alibaba Group Holding Limited. We have sold our Alibaba Group Holding Limited position as the company continues to face competitive challenges and regulatory pressures remain, making it difficult (if not impossible) to appropriately assess the range of outcomes and associated probabilities for the future profitability of the business.”

4. The Walt Disney Company (NYSE:DIS)

Number of Hedge Fund Holders: 111

The Walt Disney Company (NYSE:DIS) operates as an entertainment company. The stock is trading at nearly 40% below record highs amid park closures due to COVID-19. However, these closures do not represent a long-time concern as most economies around the world have returned to normal and those remaining are likely to follow suit soon. The firm is impressing on the streaming front, with subscribers growing 33% year-on-year in the second quarter. The company has pricing power with a massive original content library to draw from as well.

On May 12, BMO Capital analyst Daniel Salmon maintained a Market Perform rating on The Walt Disney Company stock with a price target of $140, highlighting that the stock was “the type of blue chips investors will want to buy once the market stabilizes”.

At the end of the fourth quarter of 2021, 111 hedge funds in the database of Insider Monkey held stakes worth $6.9 billion in The Walt Disney Company, up from 101 the preceding quarter worth $9.4 billion.

In its Q4 2021 investor letter, ClearBridge Investments, an asset management firm, highlighted a few stocks and The Walt Disney Company was one of them. Here is what the fund said:

“The communication services sector was a weak spot in both the benchmark and the portfolio in the fourth quarter. The Walt Disney Company announced lower than expected streaming subscriber growth to the company’s Disney+ offering, attributable primarily to the content release schedule. The Walt Disney Company has been ramping up content spending given strong global response to Disney+, although production capability was temporarily impacted by COVID-19. We still believe Disney is on track to reach the subscriber outlook outlined at its December 2020 analyst day, driven by a very robust slate of content releases, particularly in the 2022–2024 time period.”

3. Apple Inc. (NASDAQ:AAPL)

Number of Hedge Fund Holders: 134

Apple Inc. is a consumer electronics firm. Although the company has avoided the market meltdown of 2022, recent signs suggest that the overall volatility is beginning to catch up with the stock as well. The stock dropped by about 5% in mid-May after the firm said it expected an $8 billion hit from supply chain pressures in 2022. However, despite the forecast, the firm continues to deliver on the earnings front, managing positive growth in earnings per share and revenue in the first quarter. It also has strong pricing power due to the iPhone brand.

On May 20, Wedbush analyst Daniel Ives maintained an Outperform rating on Apple Inc. stock with a price target of $200, highlighting that the firm was a “compelling name to own and ride out the market storm”.

At the end of the fourth quarter of 2021, 134 hedge funds in the database of Insider Monkey held stakes worth $186 billion in Apple Inc., up from 120 in the previous quarter worth $146 billion.

In its Q4 2021 investor letter, Berkshire Hathaway highlighted a few stocks and Apple Inc. was one of them. Here is what the fund said:

“Apple Inc. – our runner-up Giant as measured by its yearend market value – is a different sort of holding. Here, our ownership is a mere 5.55%, up from 5.39% a year earlier. That increase sounds like small potatoes. But consider that each 0.1% of Apple’s 2021 earnings amounted to $100 million. We spent no Berkshire funds to gain our accretion. Apple’s repurchases did the job. It’s important to understand that only dividends from Apple are counted in the GAAP earnings Berkshire reports – and last year, Apple paid us $785 million of those. Yet our “share” of Apple’s earnings amounted to a staggering $5.6 billion. Much of what the company retained was used to repurchase Apple Inc. shares, an act we applaud. Tim Cook, Apple’s brilliant CEO, quite properly regards users of Apple Inc. products as his first love, but all of his other constituencies benefit from Tim’s managerial touch as well.”

2. Mastercard Incorporated (NYSE:MA)

Number of Hedge Fund Holders: 144

Mastercard Incorporated is a technology firm with core interests in transaction processing services. Although the short-term fortunes of the firm are linked to the health of the economy, the long-term catalysts for the stock outweigh the near-term concerns. The firm is responsible for nearly a quarter of the credit card network purchase volume. Since it is not a lender, it is not exposed to loan delinquencies during recessions either. The firm has a long runway of growth in emerging markets as well.

On May 17, Goldman Sachs analyst Will Nance initiated coverage of Mastercard Incorporated stock with a Buy rating and a price target of $460, backing the firm to continue to deliver “best-in-class” earnings supported by secular tailwinds and strong operating leverage.

Among the hedge funds being tracked by Insider Monkey, Virginia-based investment firm Akre Capital Management is a leading shareholder in Mastercard Incorporated, with 5.8 million shares worth more than $2 billion.

In its Q1 2022 investor letter, Ensemble Capital, an asset management firm, highlighted a few stocks and Mastercard Incorporated was one of them. Here is what the fund said:

“Mastercard Incorporated (7.6% weight in the Fund): This company literally earns a percent based fee on dollars spent. When inflation increases the prices of goods across the economy, Mastercard’s revenue increases along with inflation. Thus, Mastercard Incorporated in some respects is perfectly hedged against inflation with their revenue accelerating automatically when inflation surges.”

1. Meta Platforms, Inc. (NASDAQ:FB)

Number of Hedge Fund Holders: 224

Meta Platforms, Inc. is a tech firm that owns and runs social media platforms. In 2021, the firm posted topline growth of 31%. However, this growth has stalled this year and the firm has put on a hiring freeze to deal with the challenging macroeconomic environment. At the core, the firm remains a digital advertising firm, despite a recent pivot to the metaverse, and growth in this sector is likely to remain strong for years to come. The firm is also devising a long-term plan to compete with social media giant TikTok.

On May 16, Morgan Stanley analyst Brian Nowak kept an Overweight rating on Meta Platforms, Inc. stock with a price target of $330, noting that the “combination of a revenue acceleration in the second half and cost discipline” could lead to significant free cash flow for the firm.

At the end of the fourth quarter of 2021, 224 hedge funds in the database of Insider Monkey held stakes worth $31.8 billion in Meta Platforms, Inc., compared to 248 in the preceding quarter worth $38.5 billion.

In its Q1 2022 investor letter, Vulcan Value Partners, an asset management firm, highlighted a few stocks and Meta Platforms, Inc. was one of them. Here is what the fund said:

“Meta Platforms, Inc., the parent company of Facebook, reported excellent operating results in 2021. Its revenue increased 37%, operating earnings increased 40%, and the company generated $40 billion of free cash flow. Despite these excellent results, Meta experienced extreme volatility in its stock price during the first quarter. We believe that two factors are responsible for this volatility. First, the company quantified the headwind to revenue from Apple’s recent privacy changes in the amount of approximately $10 billion for 2022. Meta is rebuilding its advertising technology, and we believe the long-term headwinds from Apple’s privacy changes will be limited because Meta Platforms, Inc. will create a suitable solution. Second, Meta continues to invest heavily into its Reality Labs segment, also known as the metaverse. While we believe the metaverse presents great opportunity for Meta Platforms, Inc., we are not assigning any value to it in our valuation work. While 2022 may be challenging for Meta, the company’s competitive advantages are still intact, and the company trades at a significant discount to our estimate of its intrinsic value. Despite our concerns about a possible recession, we expect Meta to return to double-digit bottom line growth next year.”

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