In this article, we will take a look at the top 5 couch potato stock portfolios. To see more such companies, go directly to Couch Potato Stock Portfolio: 10 Best Stocks To Buy.
5. NVIDIA Corporation (NASDAQ:NVDA)
Number of Hedge Fund Holders: 132
NVIDIA Corporation (NASDAQ:NVDA) is one of the top holdings of Vanguard U.S. Total Market Index ETF (VUN), the Vanguard Index 500 Fund (VFIAX) and Vanguard Total Stock Market ETF (VTI). The advantage NVIDIA Corporation (NASDAQ:NVDA) has in the GPU and chips industry will continue to make profits for the company in the future, driven by the AI revolution which is set to boost the demand for GPUs. Recently, NVIDIA Corporation (NASDAQ:NVDA) shareholders rejoiced after the stock jumped significantly following strong Q1 results and impressive Q2 guidance.
A total of 132 hedge funds in Insider Monkey’s database of 943 funds reported owning stakes in NVIDIA Corporation (NASDAQ:NVDA) as of the end of the first quarter. The biggest stakeholder of NVIDIA Corporation (NASDAQ:NVDA) during this period was Rajiv Jain’s GQG Partners which owns a $2.3 billion stake in the company.
Harding Loevner Global Equity Strategy made the following comment about NVIDIA Corporation (NASDAQ:NVDA) in its Q1 2023 investor letter:
“It also signaled lower capital expenditures and increased share repurchases. Other tech companies, including Salesforce, similarly benefited from plans to lower costs and increase profitability. Meanwhile, NVIDIA Corporation (NASDAQ:NVDA), the graphic-chips designer, surged amid investor enthusiasm over the potential commercial applications of artificial-intelligence technologies, such as ChatGPT, which requires the use of many chips.”
4. Alphabet Inc. (NASDAQ:GOOGL)
Number of Hedge Fund Holders: 204
Alphabet Inc. (NASDAQ:GOOGL) is a significant holding of several total market index funds including Vanguard U.S. Total Market Index ETF (VUN), the Vanguard Index 500 Fund (VFIAX) and Vanguard Total Stock Market ETF (VTI). Alphabet Inc. (NASDAQ:GOOGL)’s dominance in the search engine market, its Cloud computing growth, and its investments in futuristic sectors make it one of the best stock picks for couch potato portfolio.
As of the end of the first quarter of 2023, 204 hedge funds in Insider Monkey’s database of 943 hedge funds were long Alphabet Inc. (NASDAQ:GOOGL). The most notable stakeholder of Alphabet Inc. (NASDAQ:GOOGL) was Natixis Global Asset Management’s Harris Associates which owns a $3.83 billion stake in the company.
Lakehouse Global Growth Fund made the following comment about Alphabet Inc. (NASDAQ:GOOG) in its April 2023 investor letter:
“Alphabet Inc. (NASDAQ:GOOG) reported a modest quarterly result, with revenue and earnings per share up 2.6% and down 4.9% year-on-year, respectively. It was a mixed quarter with a weak advertising market offset by strong momentum in Google Cloud and growth in the YouTube subscription business. Advertisers continued to pull back on spending during the period, though we are starting to see quarter-on-quarter improvements in the performance of Google Search and YouTube ads. The highlight of the quarter was Google Cloud’s strong operational results, with revenues up 28% while posting profitability. This was driven by strong relationships with large enterprises and the partner ecosystems that have been built over the past four years. Moving forward, the opportunity for Alphabet to deliver consistent profitable growth relies on its ability to control costs and improve productivity. The recent restructuring round is a step in the right direction and we believe that management will be able to efficiently manage its costs while going after growth opportunities.”
3. Meta Platforms, Inc. (NASDAQ:META)
Number of Hedge Fund Holders: 220
Over the years Meta Platforms, Inc. (NASDAQ:META) has diversified its income streams significantly. In addition to owning Facebook, Instagram, WhatsApp, the company plans to invest heavily in the AI industry and launch new products. Recently, Meta Platforms, Inc. (NASDAQ:META) revealed the third version of its Quest headset, the Meta Quest 3.
The AR/VR headset will start from $500.
Its diverse investments and huge user base make Meta Platforms, Inc. (NASDAQ:META) a decent pick for any couch potato stock investor. It’s also a notable holding of many famous index funds including Vanguard U.S. Total Market Index ETF (VUN), the Vanguard Index 500 Fund (VFIAX) and Vanguard Total Stock Market ETF (VTI).
As of the end of the March 2023 quarter, 220 hedge funds tracked by Insider Monkey had stakes in Meta Platforms, Inc. (NASDAQ:META). The biggest stakeholder of Meta Platforms, Inc. (NASDAQ:META) during this period was Philippe Laffont’s Coatue Management which owns a $1.71 billion stake in the company.
Harding Loevner Global Equity Strategy made the following comment about Meta Platforms, Inc. (NASDAQ:META) in its Q1 2023 investor letter:
“The losses from SVB and First Republic were significantly mitigated, though not fully offset, by a rebound in shares of growth companies, which contributed to outperformance among our Communication Services and IT holdings. Our biggest relative contributor was Meta Platforms, Inc. (NASDAQ:META), the parent of Facebook, which pledged to boost efficiency through layoffs and a hiring freeze.”
2. Amazon.com, Inc. (NASDAQ:AMZN)
Number of Hedge Fund Holders: 243
Amazon.com, Inc. (NASDAQ:AMZN) is an important part of the Vanguard Index 500 Fund (VFIAX). Wells Fargo & Company (NYSE:WFC) recently started covering Amazon.com, Inc. (NASDAQ:AMZN) with an Overweight rating and a $159 price target as the firm called the ecommerce giant its top pick. Wells Fargo & Company (NYSE:WFC) believes retail margins in North America could return to 2019 levels in 2025.
As of the end of the first quarter of 2023, 243 hedge funds tracked by Insider Monkey had stakes in Amazon.com, Inc. (NASDAQ:AMZN). The biggest stakeholder of Wells Fargo & Company (NYSE:WFC) during this period was Natixis Global Asset Management’s Harris Associates which owns a $2.4 billion stake in the company.
Lakehouse Global Growth Fund made the following comment about Amazon.com, Inc. (NASDAQ:AMZN) in its April 2023 investor letter:
“Amazon.com, Inc. (NASDAQ:AMZN) delivered a positive quarterly result with overall growth and profitability coming in ahead of expectations. Net sales increased 9% year-on-year (11% constant currency) to $127 billion and operating profits increased 30% year-on-year to $4.5 billion. In retail, growth proved resilient and it was encouraging to see operating margins for the North American unit turn positive for the first time since mid 2021 – coming in at 1.2% (or roughly 1.5% ex-restructuring). Even more encouraging, though, was Andy Jassy’s comments that they are confident they can achieve pre-pandemic operating margin levels of 4%-6% for North America with time. Looking forward, we continue to believe there is significant margin expansion ahead as cost pressures related to external macro factors, such as elevated shipping and fuel costs, and also lower productivity and efficiency continue to ease over 2023.
On the other hand, the outlook for the company’s second largest segment, Amazon Web Services (AWS), wasn’t so rosy. AWS grew 16% year-on-year to $21.4 billion, which isn’t terrible, but was a material deceleration from last quarters growth of 20%. Concerns were only heightened by management’s comments that growth slowed even further to 11% in April. As has been the case over the last few quarters, the headwinds were driven by enterprise customers seeking to optimise cloud spending and management reiterated that the slowdown is macro-driven. These comments are consistent with what we have heard from other cloud providers, and in our view, the current headwinds are more a factor of strong comparison periods and cyclical weakness, as opposed to any fundamental issues. Taking a step back, AWS remains the leading cloud provider (in what is an increasingly two-horse race with Microsoft’s Azure) and with 90% of global IT spend still on-premise there is still plenty of runway for future growth. At current levels, Amazon’s valuation at 5x gross profit is the most attractive it’s been since the GFC and we remain confident that patient shareholders will be treated well as the company is set to deliver many years of solid revenue growth and margin expansion.”
1. Microsoft Corporation (NASDAQ:MSFT)
Number of Hedge Fund Holders: 289
Microsoft Corporation (NASDAQ:MSFT) is easily one of the obvious choices for any couch potato stock investor since the sheer size and first-mover advantage it has in the AI space are enough to propel MSFT shares higher in the coming years. The AI revolution that Microsoft Corporation (NASDAQ:MSFT) is spearheading with its huge OpenAI investments and plans is just getting started, and many analysts believe investing in MSFT is one of the simplest ways to play the AI boom.
Microsoft Corporation (NASDAQ:MSFT) is also the most popular stock among 943 hedge funds tracked by Insider Monkey.
You can also take a peek at 12 Best 5G Stocks To Buy Now and 10 Best Fast Growth Stocks To Buy.
