In this article, we discuss the 9 best Dow stocks to buy according to analysts.
Since its introduction in 1896, the Dow Jones has undergone significant changes but remains a popular benchmark for measuring the economy and the overall stock market outlook. While the Index has gained 13% year to date, it has lagged the S&P 500, up by 21% over the same period.
The significant underperformance is because the Dow is mostly made up of blue-chip American companies, most of which have come under pressure amid deteriorating macroeconomics. While the Index is mostly made up of financial services companies at 23%, followed by technology at 20%, it has felt the full brunt of deteriorating economic conditions.
READ ALSO: 8 Worst Performing Tech Stocks in 2024 and 10 Worst Performing Blue Chip Stocks in 2024.
The U.S. economy is reeling from the effects of high interest rates, resulting in a slowdown in the labour market, and the manufacturing sector has significantly affected the Dow holdings. Additionally, the soaring geopolitical tensions in the Middle East have rattled investors’ sentiments, resulting in most of them shunning equities in favor of safe havens like bonds and treasuries.
The uncertainty around the upcoming U.S. presidential election has only exacerbated the situation, with investors shunning stocks that would be affected mainly by a change of policies once there is a leadership change at the White House. According to analysts at Bank of America, who ends up in the White House and Congress could have a significant impact on critical corners of the stock market.
“Profits accelerating are far more important than who is sitting in the Oval Office. But politics can make or break sub-sectors,” the firm wrote in a research note to investors.
Amid the headwinds, the overall equity market has been trading higher, with major indices led by the Dow and the S&P 500 rallying to record highs. The strong gains have come on most companies delivering solid financial results and shrugging off the effects of high interest rates. Nevertheless the rallies have resulted in overstretched valuations, raising serious concerns for the investment community.
“The market had moved into overbought territory, making it vulnerable to anything it perceives as negative … It’s now worried that the Fed has not declared victory on inflation, and not to mention, the concerns post-election,” said LPL Financial chief global strategist Quincy Krosby.
A resilient U.S. economy that has steered clear of recession has helped support most stocks in the Dow, helping fuel the upward momentum. The International Monetary Fund thinks growth in the U.S. will remain robust. In its latest World Economic Outlook, the IMF increased its estimate for U.S. GDP in 2024 to 2.8% from its 2.6% forecast in July while raising its 2025 growth forecast for the country. It’s the only advanced economy with its economic trajectory revised upwards for both years by the IMF. Nevertheless, it has warned of slowdowns in emerging markets.
“Projected slowdowns in the largest emerging market and developing economies imply a longer path to close the income gaps between poor and rich countries. Having growth stuck in low gear could also further exacerbate income inequality within economies,” the IMF warned.
With the U.S. economy expected to remain resilient as the Federal Reserve pushes forth with interest rate cuts, Dow stocks that have underperformed are well poised to bounce back. A lower interest rate environment on the back of improved economic conditions heading into year-end would make the case for the best Dow stocks to buy, according to analysts.
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Our Methodology
To compile our list of the best Dow stocks to buy according to analysts, we started by analyzing the Dow Jones Industrial Average. We screened these stocks based on average price targets, focusing on stocks with significant upside potential. Finally, we ranked these companies in ascending order based on their price target upside as of October 23. We have also mentioned the hedge fund sentiment around each stock.
At Insider Monkey, we are obsessed with the stocks that hedge funds pile into. The reason is simple: our research has shown that we can outperform the market by imitating the top stock picks of the best hedge funds. Our quarterly newsletter’s strategy selects 14 small-cap and large-cap stocks every quarter and has returned 275% since May 2014, beating its benchmark by 150 percentage points (see more details here).
Best Dow Stocks to Buy According to Analysts
9. Dow Inc. (NYSE:DOW)
Average Upside Potential as of October 23: 10.16%
Number of Hedge Fund Holders: 32
Dow Inc. (NYSE:DOW) is a basic materials company that provides materials sciences solutions for packaging consumer, mobility and infrastructure applications. It is one of the best Dow Jones stocks to buy, according to analysts, owing to its impressive track record of innovation, inclusivity, and sustainability, which have been key to its achieving profitable growth.
While the company has been under pressure, going down by about 7.84% year to date compared to a 12.35% gain for the Dow index, it is a solid long-term play as it trades at a discount. The underperformance comes from Dow Inc. (NYSE:DOW), which is facing headwinds from demand softness in Europe and Asia. Lower consumer spending and inflationary pressure have also presented significant challenges.
Amid the overall weakness in the basic materials sector, Dow has consistently paid dividends affirming its financial health. It has already announced a quarterly dividend of 70 cents a share, continuing its long-standing tradition. While trading at a price-to-earnings multiple of 13, Dow Inc. (NYSE:DOW) yields 5.36%, which is ideal for generating passive income.
The company’s prospects to generate additional free cash flow to continue paying dividends have further been affirmed by the U.S. Energy Department announcing plans to invest $3 billion in the battery manufacturing sector. As the U.S. moves to reduce its dependence on China for battery reduction, Dow Inc. (NYSE:DOW) should be one of the beneficiaries. Analysts on Wall Street rate the stock as a Hold with an average price target of $57.36, implying 10.16% upside potential.
ClearBridge Investments, an investment management company, released its second quarter 2024 investor letter. Here is what the fund said:
“Our industrials holdings weighed on relative performance as we are more exposed to transports such as “less than truckload” provider XPO and parcel delivery company United Parcel Service, Inc. (NYSE:UPS), which are struggling with weak volumes during the post-COVID freight recession. With industry volumes down to pre-COVID levels and strong pricing power in the LTL space in particular, we believe that the next upcycle will prove to be very strong for earnings. As a result, we added to XPO in the quarter while reducing our position in UPS on concerns that industry capacity remains excessive. Meanwhile, we have less exposure to electrical equipment stocks, which have been rewarded by views that they will benefit from the buildout of AI data centers.”
8. Intel Corp. (NASDAQ: INTC)
Average Upside Potential as of October 23: 13.13%
Number of Hedge Fund Holders: 75
Intel Corporation (NASDAQ:INTC) has been under pressure going by the 53.26% year-to-date decline. The selloff comes on the company struggling with production shortages, chip shortages, and strategic changes under different CEOs.
Stiff competition from Taiwan Semiconductor and Samsung has been one factor that has rattled Intel’s sentiments in the market. As AMD decided to outsource its production to third-party foundries, Intel refused to spin off the capital-intensive unit, opting for the entire manufacturing.
The company struggled in the foundries business due to persistent delays and shortages that forced some of its customers to pivot towards AMD. Intel’s foundry operations also face an uncertain future amid plans to lay off 15% of the workforce.
Amid the struggles in the Foundry business, Intel Corporation (NASDAQ:INTC) is increasingly pursuing a new path in artificial intelligence by doubling down its integrated device manufacturing industry. It has already started offering its chip-making services to other companies, including Microsoft and Amazon.
The federal government awarded Intel $3 billion for its IDM strategy to increase semiconductor manufacturing in the United States. This was on top of an additional $8.5 billion government award. The multibillion deals underscore the company’s long-term prospects.
Intel Corporation (NASDAQ:INTC) is one of the best Dow stocks to buy, according to analysts, as it is trading at a discount after a 50% pullback. The company also continues to return value, announcing a $60 billion share buyback program. It has also announced a 10% increase in its quarterly dividend, which currently yields 2.19%. The average price target on the stock is $25.34, implying 13.13% upside potential.
According to the Insider Monkey database, 75 hedge fund portfolios included Intel Corporation (NASDAQ:INTC) at the end of the second quarter this year, down slightly from 77 in the previous quarter.
Here’s what ClearBridge Large Cap Value mentioned about Intel Corporation (NASDAQ:INTC) in its Q3 2024 investor letter:
“While the market environment clearly was a headwind in the third quarter, several of our large positions also faced challenging conditions, which negatively impacted results. In the information technology (IT) sector, Intel Corporation (NASDAQ:INTC) has come under additional pressure due to continued softness in the company’s core PC and server markets as well as concerns on the company’s longer-term competitive position. While Intel’s turnaround is not happening overnight, we are constructive on the outlook into 2025: the company’s product positioning should be much improved and it should be positioned to gain market share in a cyclical upswing in which it has strong earnings power. A somewhat adverse spending environment due to AI myopia has weighed on shares, but we still think the market is undershipping PCs and general servers following a COVID normalization period that saw demand get pulled ahead and then languish as companies froze IT budgets. The installed base is now getting older, and we expect a strong refresh cycle into next year. The delay is actually beneficial to Intel, whose product positioning will be all the more improved. While our investment case is not predicated on an M&A transaction, and we believe one is unlikely, the expression of interest in the company speaks to the value of the assets, which we think still trade at a meaningful discount to fair value.”
7. NIKE, Inc. (NYSE:NKE)
Average Upside Potential as of October 23: 13.23%
Number of Hedge Fund Holders: 66
Apparel and footwear giant NIKE, Inc. (NYSE:NKE) has been under pressure for the better part of the year amid disappointing financial results and guidance that have sent jitters about the company’s growth metrics. The stock was yet again under pressure after it delivered disappointing second-quarter results, with revenues dropping 10% and profits down 285 year over year. Failure to provide a forecast for the fiscal year ending in May also rattled investors.
Amid the disappointing results and muted outlook, Nike remains one of the best Dow stocks to buy, according to analysts, as it is in a transition period. NIKE, Inc. (NYSE:NKE) has already appointed Elliott Hill as its new CEO, tasked with reinvigorating its growth prospects. In addition to a new CEO, the company boasts of one of the strongest brands as a leader in the global sportswear industry, affirming its long-term prospects.
NIKE, Inc. (NYSE:NKE) continues to dominate the global sportswear market. Decades of innovation and skilful marketing to establish a strong customer connection have led to this position. Because of pricing power, the unique brand has reported an average gross margin of 44.7% over the last ten years.
While Nike is trading at an average P/E of 23, it is significantly lower than its average P/E of 37 in the past decade. Additionally, analysts on Wall Street rate the stock as a Buy with an average price target of $92.19, implying a 13.23% upside potential.
According to the Insider Monkey database, 66 hedge funds held bullish positions on NIKE, Inc. (NYSE:NKE) at the end of Q2 2024. This indicates a strong interest in the stock among institutional investors, despite a slight decrease from 71 in the previous quarter.
Mar Vista Investment Partners’ Mar Vista Focus strategy stated the following regarding NIKE, Inc. (NYSE:NKE) in its Q2 2024investor letter:
“NIKE, Inc.’s (NYSE:NKE) stock declined following management’s revised forecast for fiscal year 2025, projecting negative mid-single-digit revenue growth instead of the previously anticipated positive growth. The company has observed a marked slowdown in lifestyle product sales since April, a trend that persisted into June. Our current projections indicate that both sales and earnings will fall 15-20% below the conservative estimates set by management just a quarter ago. This substantial downward revision in sales and earnings is attributed to insufficient product innovation, wholesale channel shift, and intentional reduction of supply in lifestyle franchises. While the negative adjustments to guidance could potentially act as a clearing event for the stock, the degree of conservatism in the new projections remains uncertain.
Nike maintains its position as the global leader in sportswear. However, its revenue growth has been hampered by a lack of innovation, and deteriorating macroeconomic conditions in the US and China further complicate its recovery. The company’s renewed focus on innovation and efforts to re-engage with wholesale channels may eventually help restore growth, but we believe increased skepticism regarding management’s ability to execute is justified.”
6. Chevron Corporation (NYSE:CVX)
Average Upside Potential as of October 23: 13.64%
Number of Hedge Fund Holders: 64
Chevron Corporation (NYSE:CVX) is one of the energy stocks that have come down tumbling in the aftermath of oil prices plunging from above $80 a barrel to lows of $70 a barrel. While the stock is flat for the year compared to a 13% gain for the Dow Jones index, it is one of the best Dow stocks to buy, according to analysts.
The fact that the company boasts of one of the lowest debt-to-equity ratios of 0.15 underlines its ability to generate significant cash flows, consequently maintaining low debt levels. Additionally, Chevron Corporation (NYSE:CVX) is one of the largest and most diversified energy companies that should continue to generate long-term value with oil prices above $40 a barrel.
Chevron boasts of an impressive track record of dividend growth supported by a strong balance sheet. It boasts an above-industry average yield of 4.4%, making it a solid investment play for passive income. The company has increased its dividend payment for 37 consecutive years, which is an incredible feat given the challenges in the energy sector.
While falling oil prices will affect Chevron Corporation (NYSE:CVX), it is well-equipped to handle lower prices. The company is well positioned to generate enough cash flow for operations to cover its dividend, even with oil prices dropping to the $50 barrel level. Likewise, it can use its cash-rich solid balance to repurchase shares, bolstering its earnings per share.
By purchasing Hess, Chevron Corporation (NYSE:CVX) hopes to improve its capacity to prosper at lower oil prices further. That deal would greatly strengthen and extend Chevron’s production and free cash flow growth profile. On the other hand, analysts on Wall Street maintain a buy rating on Chevron with an average price argot of $171.50, implying a 13.64% upside potential.
According to Insider Monkey’s database for Q2 2024, 64 hedge funds had investments in Chevron, up from 62 in the first quarter.
In its Q4 2023 investor letter, Diamond Hill Capital’sDiamond Hill Large Cap Strategy shared insights on Chevron Corporation (NYSE:CVX):
“Other bottom contributors included Chevron Corporation (NYSE:CVX), Carrier Global and Becton, Dickinson. Shares of integrated oil and gas company Chevron were pressured as global oil production is growing — particularly in the US, which has now surpassed its past production levels — in turn pressuring oil prices and company profit margins.”
5. The Walt Disney Company (NYSE:DIS)
Average Upside Potential as of October 23: 15.91%
Number of Hedge Fund Holders: 92
The Walt Disney Company (NYSE:DIS) is an entertainment company that produces and distributes film and television video streaming content. It also operates the world’s largest theme park business, accounting for over 30% of its revenues.
The Walt Disney Company (NYSE:DIS) has sought to alleviate concerns about its theme park business by announcing plans to invest $60 billion in the unit over the next 10 years. It plans to introduce four new cruise ships, lands, and rides across its global theme parks. In addition, the company is pursuing growth opportunities around content streaming with its Disney+ streaming service. The unit already has over 118 million subscribers, providing a new avenue for growth, especially in generating advertising revenues.
The Walt Disney Company (NYSE:DIS) is a well-known brand, and even though the state of the economy has an impact on its short-term prospects, there are many reasons to be hopeful about the long term, particularly if it can continue to turn a profit from its streaming business, which is a challenge for many media companies.
While trading at a price-to-earnings multiple of 18, The Walt Disney Company (NYSE:DIS) rewards investors with a 0.93% dividend yield. Additionally, analysts on Wall Street believe it is a strong buy with an average price target of $112.13, implying a 15.91% upside potential.
In the second quarter, 92 hedge funds held positions in the company, collectively valuing their stakes at $4.76 billion. The substantial hedge fund interest underscores the company’s attractiveness as a stable and promising investment opportunity.
Meridian Funds, managed by ArrowMark Partners, released its second quarter 2024 investor letter. Here is what the fund said:
“The Walt Disney Company (NYSE:DIS) operates a diversified entertainment business with theme parks, media networks, and streaming services. We own Disney because we believe its strong brand, valuable IP, and expanding streaming offerings will drive sustainable long-term growth. The company’s stock, however, underperformed in the quarter due to concerns about a slowdown in growth at its theme park division. While park revenue still grew by 10% year-over-year, management’s commentary suggested a moderation in post-pandemic demand and rising costs, leading to a disappointing outlook for park operating income in the second half of the year. This overshadowed the positive news that the company’s streaming segment, driven by strong subscriber growth at Disney+, reached profitability ahead of schedule. We held our position and will continue to monitor the performance of the theme park division.”
4. Amazon.com Inc. (NASDAQ: AMZN)
Average Upside Potential as of October 23: 18.17%
Number of Hedge Fund Holders: 308
According to analysts, Amazon.com, Inc. (NASDAQ:AMZN) is arguably one of the best Dow stocks to buy, owing to the diversified nature of its business empire and tremendous opportunities for growth. While the company is best known for its e-commerce operations, it’s become a key player in the artificial intelligence race, strengthening its growth prospects in cloud computing.
An increasingly important aspect of Amazon’s operations is its third-party seller services division. With little risk, it is its second-largest revenue segment and offers a pleasant profit boost. It makes sense that Amazon.com, Inc. (NASDAQ:AMZN) provides this service to independent sellers who wish to join the Amazon network, given that it has established a sizable warehouse footprint and logistics network to transport goods from seller to buyer. Because third-party sellers are in charge of maintaining the product inventory, the business benefits from this.
With an annualized run rate of $50 billion and a 20% growth rate, Amazon’s advertising division is now a significant player in digital advertising, trailing only Facebook, Instagram, and Search. However, advertising should continue proliferating as Amazon can better target ads to customers more likely to purchase by connecting its vast customer data. Additionally, there are still unexplored opportunities in this segment.
For Amazon.com, Inc. (NASDAQ:AMZN), advertising is a rising star. With a 20% increase in revenue in the second quarter, it is currently the segment with the fastest growth rate, and it is not finished yet. Although it has experienced rapid expansion, management says it thinks video advertising is still in its infancy. Its commerce business also benefits significantly from advertisements, contributing to the recent profit margin increase.
Going by the tremendous opportunities for growth to generate long-term value, Amazon is rated as a strong buy with an average price target of $224.16, implying an 18.17% upside potential.
According to Insider Monkey, Amazon.com, Inc. (NASDAQ:AMZN) is currently the most widely held stock among hedge funds. As of Q2 2024, 308 hedge funds had stakes in the company, reflecting its strong appeal to institutional investors.
Alphyn Capital Management stated the following regarding Amazon.com, Inc. (NASDAQ:AMZN) in its Q3 2024 investor letter:
“Amazon.com, Inc.’s (NASDAQ:AMZN) continued growth is driven by its strong performance in AWS and advertising, which grew 19% and 20%, respectively. E-commerce growth moderated to 9.3%, likely due to softer consumer demand.
In previous letters, I mentioned how Amazon’s heavy investments in logistics and fulfillment suppressed margins for some time, but the company is now reaping the rewards of those earlier expenditures. European operations have been profitable for the second consecutive quarter, while North American operating margins have risen from pandemic lows to 5.3%. A key ongoing area of focus for Amazon has been reducing the “cost to serve”; this is beginning to show tangible benefits. In 2023, Amazon undertook a “regionalization” strategy, which divided the U.S. into eight distinct regions for fulfilment and transportation, with corresponding distribution centres in each. As I learned from an expert interview done by InPractise, “regionalization” has resulted in estimated shipping expenses dropping from $4.76 per unit to $4.50, and they are now approximately $4.26, with potential reductions of 2-3% annually. Interestingly, Amazon leaned on its third-party vendors (3P) to finance much of this strategy. It did so by requiring 3P vendors to ship inventory to the multiple regional distribution centers, instead of to a single location as they used to do.
Moreover, Amazon imposed penalties for failing to meet strict minimum and maximum quantities. In this way, Amazon used 3P inventory to expand its distribution capacity by around 24 million square feet, much of which it could use for its own 1P inventory. Clever strategy, but one wonders if this raises the risk of an eventual vendor backlash due to the added financial and logistical pressures on 3P sellers.
Like Alphabet, Amazon invests heavily in its AWS infrastructure to support its growing AI business. In the first half of the year, the company spent $30.5 billion on capital expenditures, with plans to exceed that in the year’s second half. When questioned about this during the earnings call, CEO Andy Jassy emphasized that they are seeing significant demand for AI-related services, which he believes will become a “very large” business for Amazon.”
3. Microsoft Corporation (NASDAQ:MSFT)
Average Upside Potential as of October 23: 17.75%
Number of Hedge Fund Holders: 279
Microsoft Corporation (NASDAQ:MSFT) has emerged as the biggest winner amid the artificial intelligence race owing to its multibillion-dollar investments in OpenAI and other generative A.I. innovations. Nevertheless, the company boasts a robust business empire spanning software, cloud computing, gaming, and devices, which is why it is one of the best Dow stocks to buy, according to analysts.
Microsoft Corporation (NASDAQ:MSFT)’s Azure cloud computing division has benefited most from A.I., as businesses use its platform to develop their own A.I. solutions. Similarly, as evidenced by revenue growth of between 29% and 30% over the last few quarters, the unit is becoming a major contributor to underlying growth. The business is looking at A.I. to support growth in areas other than cloud computing. Search is one area benefiting from Microsoft A.I. investments following the integration into Bing search to better compete against Google.
Another significant success story for A.I. is its GitHub Developer platform, where users have resorted to Copilot. This AI assistant can offer suggestions while developers type and even finish coding tasks. Additionally, Microsoft Corporation (NASDAQ:MSFT) is pursuing growth in gaming following its acquisition of Activision Blizzard, which provides another avenue for generating revenues and long-term value.
While the stock trades at a 10.5% premium with a price-to-earnings multiple of 35.5, it is expected of a company with tremendous opportunities for growth. The stock rewards investors with a 0.79% Dividend yield for generating passive income. Likewise, Wall Street analysts rate it as a buy with an average price target of $503.38, implying a 17.75% upside potential.
Additionally, Insider Monkey’s Q2 data reveals that 279 hedge funds have invested in Microsoft Corporation (NASDAQ:MSFT), making it one of the most popular stocks among hedge funds at the moment.
2. Boeing Co (NYSE: BA)
Average Upside Potential as of October 23: 23.74%
Number of Hedge Fund Holders: 42
Down by about 50% over the past five years, Boeing Co (NYSE:BA) has lagged the Dow Jones index and the overall market. While the company boasts of a Competitive edge and virtual duopoly in the aerospace industry, a string of quality control and legal challenges have dragged the brand’s reputation down the drain. The aerospace giant has struggled with manufacturing problems, management turmoil, and horrible financial results.
A string of safety issues touching on aeroplanes has caused Boeing Co (NYSE:BA) to get hit with billions of fines and fees, rattling its sentiments in the market. While employee strikes in recent weeks have exacerbated the situation, the company’s long-term prospects remain intact, affirming why it is one of the best Dow stocks to buy, according to analysts.
Boeing Co (NYSE:BA) and Airbus operate as a virtual duopoly in the large commercial jet aircraft market. It is a significant U.S. military contractor as well. Therefore, there is very little chance that its customers will abruptly stop purchasing its products in the near future. Rival Airbus has such a large backlog that it rejects some orders because it cannot produce the planes quickly enough. Consequently, regardless of its issues, Boeing will always have business at its exposure.
Without a doubt, Boeing Co (NYSE:BA) faces difficulties, and it is uncertain if it can finance the next generation of narrow-body aircraft within the next ten years. Nevertheless, its multi-year backlog guarantees its long-term prospects. Likewise, investors rate Boeing as a Buy with an average price target of $197.83, implying a 23.74% upside potential.
By the end of the second quarter of 2024, a notable 42 out of the 912 hedge funds tracked by Insider Monkey had invested in Boeing Co (NYSE:BA).
1. Merck & Co., Inc. (NYSE:MRK)
Average Upside Potential as of October 23: 29.15%
Number of Hedge Fund Holders: 96
Merck & Co., Inc. (NYSE:MRK) is one of the best Dow stocks to buy, according to analysts, for diversifying an investment portfolio in the healthcare sector. The company offers human health pharmaceutical products in the areas of oncology, hospital acute care, immunology, and neuroscience.
The company’s long-term prospects revolve around its cancer drug Keytruda, which became the best-selling drug worldwide. The pharmaceutical company reported $16.1 billion in revenue for the second quarter, a 7% increase from the previous year. Sales for Keytruda totaled $7.3 billion, a 16% increase over the same period last year.
Even though Keytruda accounts for a large portion of Merck & Co., Inc. (NYSE:MRK)’s revenue, the company has been working to build its pipeline and become less reliant on the wildly popular blockbuster medication. New medications, such as the pulmonary arterial hypertension medication WINREVAIR, will be crucial in making up for the lost income.
Analysts predict that its sales will surpass $6 billion by 2029 and reach a much higher peak of $11 billion. These figures are not comparable to those of Keytruda, but Winrevair and other resources might lessen the impact on Merck & Co., Inc. (NYSE:MRK) and even guarantee an increase in revenue. The pneumococcal vaccine Capvaxive, which regulators approved earlier this year, is a more modest growth catalyst. It may generate over $1 billion in sales by 2027.
Merck is investing more in cancer treatments by agreeing to pay Japanese company Daiichi Sankyo $5.5 billion last year to co-develop three of its antibody-drug conjugates. These therapies specifically target cancer cells, which may be more successful than conventional chemotherapy, harming healthy cells.
Consequently, Merck & Co., Inc. (NYSE:MRK) should be able to expand its operations even after the patents for Keytruda expire, given the abundance of opportunities available and the potential for even more in the future. This explains why the stock is rated as a Buy with an average price target of $137.73, implying a 29.15% upside potential.
As of Q2 2024, from the total number of hedge funds that Insider Monkey tracked, 96 held stakes in Merck & Co., Inc. (NYSE:MRK), with Fisher Asset Management being the largest stakeholder with shares worth $1.77 billion.
Regarding Merck & Co., Inc. (NYSE:MRK), Carillon Tower Advisers’ Carillon Eagle Growth & Income Fund made the following statement in its investor letter for the first quarter of 2024:
“After posting lackluster returns in 2023, Merck & Co., Inc. (NYSE:MRK) got off to a strong start in January by raising the long-term sales forecasts for its oncology and cardiology pipelines and reporting solid fourth-quarter results, coupled with strong financial guidance for 2024. Merck shares also finished the quarter strong after receiving U.S. Food and Drug Administration approval in late March for a new cardiology medicine with the potential to contribute significantly to sales growth over the next several years.”
While we acknowledge the potential of MRK as an investment, our conviction lies in the belief that some deeply undervalued AI stocks hold greater promise for delivering higher returns, and doing so within a shorter timeframe. If you are looking for a deeply undervalued AI stock that is more promising than MRK but that trades at less than 5 times its earnings, check out our report about the cheapest AI stock.
READ NEXT: 8 Best Wide Moat Stocks to Buy Now and 30 Most Important AI Stocks According to BlackRock.
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