In this article, we discuss 15 Dow stocks and their rank according to the 2022 hedge fund bullishness index. If you want to read our review of these stocks and the latest market situation, go directly to Dow 30 Stocks List: Ranked By 2022 Hedge Fund Bullishness Index.
15. Walmart Inc. (NYSE:WMT)
Number of Hedge Fund Holders as of Q3, 2022: 68
Walmart Inc. (NYSE:WMT) is a retail giant with 10,500 stores and 210 distribution centers across 24 countries. The retail powerhouse reported another solid quarterly performance in September 2022, with an upside in revenue versus Wall Street estimates. Walmart Inc. (NYSE:WMT) is one of the top retail stocks in the Dow 30 list. For the past 49 years, Walmart Inc. (NYSE:WMT) has continuously increased its dividends. As of December 2022, the company has a quarterly dividend of $0.56 per share with a dividend yield of 1.46%.
Wall Street is bullish on Walmart Inc. (NYSE:WMT). On December 1, Atlantic Equities analyst Daniela Nedialkova increased her price target on Walmart Inc. (NYSE:WMT) stock to $165 from $150 and reiterated an Outperform rating. As of the end of Q3 2022, 68 hedge funds tracked by Insider Monkey were bullish on Walmart Inc. (NYSE:WMT), compared with 67 in the previous quarter. The collective value of stakes owned by these hedge funds is over $4.08 billion.
Leaven Partners mentioned Walmart Inc. (NYSE:WMT) in its Q3 2022 investor letter. Here is what the firm has to say:
“In our last quarterly letter, I briefly mentioned that the consensus estimates for corporate profits appeared to be a bit too sanguine. I referenced a Reuters article that reported, as of June 17, Wall Street expected S&P 500 earnings to grow by 9.6% in 2022, which was up from 8.8% in April and from 8.4% in January. That tune began to change at the end of July and accelerated in August and September, as major players, such as Walmart (NYSE:WMT), has recently issued profit warnings and/or have withdrawn guidance. In response, Wall Street has altered its outlook: lowering third-quarter profit growth to 4.6%[2] from 7.2% in early August and slashing full-year profit growth to 4.5%.”
14. Goldman Sachs Group, Inc. (NYSE:GS)
Number of Hedge Fund Holders as of Q3, 2022: 69
Goldman Sachs Group, Inc. (NYSE:GS) is Wall Street’s top investment bank with substantial earnings power given its strong brand. Although the company is retreating from the consumer business, Goldman Sachs Group, Inc. (NYSE:GS) still has a leading trading and investment banking unit that could continue to generate substantial profits for the years to come.
Recently, Reuters reported that Goldman Sachs Group, Inc. (NYSE:GS) is planning to cut thousands of jobs to lower its costs as the company tries to navigate the challenging economic environment. Since Goldman Sachs Group, Inc. (NYSE:GS) shares have declined 9.92% year to date, it currently trades for a forward P/E ratio of 9.22, which is pretty attractive in the long term, given the bank’s competitive advantages.
According to Insider Monkey’s Q3 data, 69 hedge funds held bullish positions in The Goldman Sachs Group, Inc. (NYSE:GS), with combined stakes worth $4.5 billion. Edgar Wachenheim’s Greenhaven Associates is one of the largest stakeholders of the company, with 2.20 million shares valued at $647.3 million.
13. Intel Corporation (NASDAQ:INTC)
Number of Hedge Fund Holders as of Q3, 2022: 69
Intel Corporation (NASDAQ:INTC) designs, manufactures and sells computer products and technologies worldwide. On October 31, Citi analyst Christopher Danely maintained a Neutral rating on Intel Corporation (NASDAQ:INTC) stock and lowered the price target to $27 from $30, noting that the company reported mixed results and guided well below consensus driven by the PC downturn.
At the end of the third quarter of 2022, 69 hedge funds in the database of Insider Monkey held stakes worth $1.9 billion in Intel Corporation (NASDAQ:INTC), compared to 65 in the preceding quarter worth $2.5 billion.
In its Q3 2022 investor letter, ClearBridge Investments, an asset management firm, highlighted a few stocks and Intel Corporation (NASDAQ:INTC) was one of them. Here is what the fund said:
“Also on the detractor side, Intel Corporation (NASDAQ:INTC) delivered a disappointing revenue miss and lowered full-year revenue and earnings guidance as COVID-19-driven demand for PCs abated (where Intel enjoys half its sales) and a delay in its flagship Sapphire Rapids CPU hurt its data center business. Despite these issues, we still believe Intel is an economically sensitive turnaround story with substantial upside.”
12. The Procter & Gamble Company (NYSE:PG)
Number of Hedge Fund Holders as of Q3, 2022: 69
The Procter & Gamble Company (NYSE:PG) is an American multinational company that provides branded consumer packaged goods worldwide. It operates through five segments – Beauty, Grooming, Health Care, Fabric & Home Care, and Baby, Feminine & Family Care. The Procter & Gamble Company (NYSE:PG) is a reliable dividend king, as it has raised its dividend payouts consistently for the last 66 years. The company’s latest quarterly dividend of $0.9133 per share was distributed on November 15.
On December 6, investment advisory Deutsche Bank raised the firm’s price target on The Procter & Gamble Company (NYSE:PG) to $162 from $156 and reiterated a Buy rating on the shares. Analyst Steve Powers issued the ratings update.
According to Insider Monkey’s data, 69 hedge funds were bullish on The Procter & Gamble Company (NYSE:PG) at the end of September 2022, compared to 71 funds in the prior quarter. Ray Dalio’s Bridgewater Associates is the biggest position holder in the company, with 6.6 million shares worth $835.20 million.
11. NIKE, Inc. (NYSE:NKE)
Number of Hedge Fund Holders as of Q3, 2022: 70
NIKE, Inc. (NYSE:NKE) is a Beaverton, Oregon-based company known for its footwear, apparel, accessories, and equipment with a sports-based theme. On November 15, NIKE, Inc. (NYSE:NKE) increased its quarterly dividend by 11% to 34 cents per share. The company is on track to become a member of the Dividend Aristocrat list as it has been raising its annual dividend for the past 15 consecutive years.
On October 13, Rick Patel at Raymond James initiated coverage on NIKE, Inc. (NYSE:NKE) with an Outperform rating and a target price of $99. Although the stock is in the red YTD due to macroeconomic headwinds and industry-specific challenges, the analyst has a long-term bullish take on NIKE, Inc. (NYSE:NKE). Experts believe the company will continue to grow due to its globally renowned brand, out-of-the-box products, and high growth in emerging markets. NIKE, Inc. (NYSE:NKE) was held by 70 hedge funds at the end of Q3 2022.
Leaven Partners discussed its outlook on NIKE, Inc. (NYSE:NKE) in its Q3 2022 investor letter. Here’s what the firm said:
“In our last quarterly letter, I briefly mentioned that the consensus estimates for corporate profits appeared to be a bit too sanguine. I referenced a Reuters article that reported, as of June 17, Wall Street expected S&P 500 earnings to grow by 9.6% in 2022, which was up from 8.8% in April and from 8.4% in January. That tune began to change at the end of July and accelerated in August and September, as major players, such as NIKE (NYSE:NKE), has recently issued profit warnings and/or have withdrawn guidance. In response, Wall Street has altered its outlook: lowering third-quarter profit growth to 4.6%[2] from 7.2% in early August and slashing full-year profit growth to 4.5%.”
10. Merck & Co., Inc. (NYSE:MRK)
Number of Hedge Fund Holders as of Q3, 2022: 82
Merck & Co., Inc. (NYSE:MRK) is an American multinational pharmaceutical company. In 2022, the company extended its dividend growth streak to 12 years, which makes it one of the best dividend stocks. It currently offers a quarterly dividend of $0.73 per share and has a dividend yield of 2.62%, as recorded on December 23.
At the end of Q3 2022, 82 hedge funds tracked by Insider Monkey presented a bullish stance on Merck & Co., Inc. (NYSE:MRK), up from 79 in the previous quarter. The stakes owned by these hedge funds have a total value of over $4.7 billion.
Chartwell Investment Partners mentioned Merck & Co., Inc. (NYSE:MRK) in its Q2 2022 investor letter. Here is what the firm has to say:
“In the Dividend Equity accounts, the three best performers in Q2 includes Merck (NYSE:MRK, 3.6%), up 12.0%. Merck, like other pharma companies, is in a defensive business, but the stock also did well as peak-sales estimates for their flagship drug, Keytruda, have gone up (JPMorgan estimates $32 billion in sales by 2026).”
09. Johnson & Johnson (NYSE:JNJ)
Number of Hedge Fund Holders as of Q3, 2022: 85
Johnson & Johnson (NYSE:JNJ) researches and develops, manufactures, and sells various products in the healthcare field. On December 12, Citi analyst Joanne Wuensch kept a Buy rating on Johnson & Johnson (NYSE:JNJ) stock and raised the price target to $205 from $198, noting that in 2023 many headwinds remain for the North America medical supplies and technology group, but these should ease in the second half of next year.
Of the 920 hedge funds in our database, 85 owned shares of Johnson & Johnson (NYSE:JNJ) at the end of Q3. Camas, Washington-based firm Fisher Asset Management is a leading shareholder in Johnson & Johnson (NYSE:JNJ) with 5.9 million shares worth more than $967.3 million.
In its Q2 2022 investor letter, Mayar Capital, an asset management firm, highlighted a few stocks and Johnson & Johnson (NYSE:JNJ) was one of them. Here is what the fund said:
“Johnson & Johnson (NYSE:JNJ) is currently our largest position and a long-standing holding. The majority of the group’s sales come from its collection of pharmaceutical franchises, but a large majority (~45%) comes from its collection of medical device businesses and its consumer brands.
Here’s how JNJ make and spends a dollar of revenues: As of 2021, about 55 cents of that dollar comes from its pharmaceutical sales – sales of drugs to pharmacies and distributors – while 30 cents come from the sale of medical devices, such as surgery equipment and orthopaedics. The rest of that dollar in sales comes from sales of JNJ’s consumer brands such as Listerine mouthwash, Nicorette nicotine tablets and Neutrogena cosmetics (…read more)
08. The Home Depot, Inc. (NYSE:HD)
Number of Hedge Fund Holders as of Q3, 2022: 89
The Home Depot, Inc. (NYSE:HD) is a home improvement retailer that provides tools, construction materials, appliances, and services. On November 14, The Home Depot, Inc. (NYSE:HD) announced market-beating earnings for the fiscal third quarter of 2022. The company reported an EPS of $4.24 and outperformed consensus by $0.13. The company generated a revenue of $38.87 billion, up 5.6% year over year, and beat estimates by $910 million.
Scot Ciccarelli, an analyst at Truist, slashed his price target on The Home Depot, Inc. (NYSE:HD) stock from $400 to $382 on November 16 while maintaining a ‘Buy’ recommendation on the stock. The analyst noted that the business remains resilient despite broader housing concerns.
At the end of Q3 2022, 89 hedge funds were bullish on The Home Depot, Inc. (NYSE:HD) and disclosed stakes worth $5.6 billion in the company. This is compared to 80 positions in the preceding quarter with stakes worth $5.4 billion. The hedge fund sentiment for the stock is positive. As of December 2, 2022, Fisher Asset Management is the largest shareholder in The Home Depot, Inc. (NYSE:HD) in our database and holds a stake worth more than $2 billion.
Matrix Asset Advisors made the following comment about The Home Depot, Inc. (NYSE:HD) in its Q3 2022 investor letter:
“During the quarter, we re-established a position in The Home Depot, Inc. (NYSE:HD) sold earlier this year, after the shares declined sharply on big picture concerns about a softer housing market and lower consumer spending. We believe that HD is a very well-managed company, positioned to continue showing good profits even as the economy decelerates. The products it carries in inventory are in year-round demand from contractors and homeowners wanting to maintain and improve their homes. The company has historically been shareholder friendly, repurchasing shares and increasing the dividend, most recently by 15% earlier this year. On September 30, HD’s current dividend yield was 2.8%.”
07. JPMorgan Chase & Co. (NYSE:JPM)
Number of Hedge Fund Holders as of Q3, 2022: 110
JPMorgan Chase & Co. (NYSE:JPM) operates as a financial services company worldwide. On December 6, Morgan Stanley analyst Betsy Graseck upgraded JPMorgan Chase & Co. (NYSE:JPM) to Overweight from Underweight with a price target of $153, up from $126, noting that the bank’s operating leverage is inflecting positively in 2023, driven by revenues up 10% year-over-year and expenses up 9%.
At the end of the third quarter of 2022, 110 hedge funds in the database of Insider Monkey held stakes worth $6.4 billion in JPMorgan Chase & Co. (NYSE:JPM), compared to 104 in the preceding quarter worth $5.8 billion.
Vltava Fund commented on JPMorgan Chase & Co. (NYSE:JPM) in a Q3 2022 investor letter:
We regard JPM to be the strongest and best- managed bank in the world. It is a leader in investment banking, commercial banking, credit cards, and asset management. Its size (the largest bank in the USA, with nearly USD 4,000 billion in assets) and diversification give it a strong competitive advantage that is compounded by its cost advantages and the high costs to clients associated with switching banks. JPM’s management prides itself on running the only large bank to avoid major instability over the long term.
JP Morgan’s quality and strength first became fully evident in 2008 under the leadership of its CEO Jamie Dimon. Not only did JP Morgan help to stabilize the market by taking over the failing Bear Stearns in the spring of that year, but throughout the Great Financial Crisis it was the only big US bank that did not require government assistance and it was highly profitable even in the difficult year of 2008.
A well-functioning and efficient bank can be a very good long-term investment, because the interest compounding effect works well here. JPM’s return on equity (ROE) is well into the double digits and this puts it in a good position to continue producing better long-term returns than does the market. JPM has been very profitable even during years when interest rates were close to zero. The current – and perhaps not temporary – return to somewhat more normal, higher interest rates should have a significantly positive impact on the bank’s interest income and overall profitability.
06. UnitedHealth Group Inc. (NYSE:UNH)
Number of Hedge Fund Holders as of Q3, 2022: 110
UnitedHealth Global Incorporated (NYSE:UNH) operates as a diversified health care company in the United States. UnitedHealth Group Inc. (NYSE:UNH) shares have risen 5.19% this year, given strong earnings. For Q3, UnitedHealth Group Inc. (NYSE:UNH) reported adjusted EPS of $5.79 on sales of $80.89 billion versus the consensus of $5.42 on revenue of $80.5 billion.
Among the hedge funds being tracked by Insider Monkey, Fort Lauderdale, Florida-based investment firm GQG Partners is a leading shareholder in UnitedHealth Global Incorporated (NYSE:UNH) with 3.2 million shares worth more than $1.6 billion.
In its Q3 2022 investor letter, Stewart Asset Management, an asset management firm, highlighted a few stocks, and UnitedHealth Global Incorporated (NYSE:UNH) was one of them. Here is what the fund said:
“Looking at the Great Recession which began at year-end 2007 and lasted to mid-year 2009 is helpful too. Our four largest current holdings in the portfolio weathered that period well. UnitedHealth’s (NYSE:UNH) earnings were resilient. While it reported modestly down earnings in 2008, its earnings rebounded quickly to record highs in 2010 and the shares responded strongly in anticipation of this.”
05. The Walt Disney Company (NYSE:DIS)
Number of Hedge Fund Holders as of Q3, 2022: 112
The Walt Disney Company (NYSE:DIS) is an entertainment powerhouse that owns many leading brands such as Lucasfilm and Pixar. Morgan Stanley analyst Benjamin Swinburne on December 12 maintained an Overweight rating on The Walt Disney Company (NYSE:DIS) but lowered his price target on the shares to $115 from $125. He trimmed his estimates to reflect updated FY23 guidance, which he views as “achievable even with the current macro environment and linear pressures.” The return of Bob Iger as CEO offers the opportunity to reorganize Disney’s Media businesses to prioritize driving overall consolidated earnings growth, added the analyst.
According to Insider Monkey’s data, 112 hedge funds were bullish on The Walt Disney Company (NYSE:DIS) at the end of the third quarter of 2022, compared to 109 funds in the last quarter. Ken Fisher’s Fisher Asset Management is a prominent stakeholder of the company, with 5.14 million shares worth $485 million.
Here is what Third Point specifically said about The Walt Disney Company (NYSE:DIS) in its Q3 2022 investor letter:
“As disclosed in our Q2 letter, we reinitiated a significant position in The Walt Disney Company (NYSE:DIS) when the company retested its Covid lows earlier this year. At the current price, Disney is trading for little more than the stand-alone value of its Parks business and a mere 15x ’24 “street” consensus. The company remains early in its Direct to Consumer (“DTC”) transition with a leading market position, and yet the current stock price ascribes negligible value to the streaming business. We believe this is due to questions around the terminal economics of streaming, given large losses being generated today at Disney (>$1 billion dollars last quarter) and stagnating margins at peers such as Netflix. On the last earnings call, management highlighted three items that could lead to an inflection in DTC profitability over the next 12 months: a 38% price increase for Disney+ in the US; moderating growth in cash content expense; and an advertising tier for Disney+ launching in two months that can drive additional ARPU given high demand for the Disney brand amongst advertisers.…” (Click here to view the full text)
04. salesforce.com, inc. (NYSE:CRM)
Number of Hedge Fund Holders as of Q3, 2022: 117
Salesforce, Inc. (NYSE:CRM) provides customer relationship management technology that brings companies and customers together worldwide. On December 5, Credit Suisse analyst Phil Winslow maintained an Outperform rating on Salesforce.com, inc. (NYSE:CRM) stock and lowered the price target to $225 from $250, noting that the company reported solid third-quarter results on the income statement.
At the end of the third quarter of 2022, 117 hedge funds in the database of Insider Monkey held stakes worth $8.2 billion in Salesforce, Inc. (NYSE:CRM), compared to 116 in the preceding quarter worth $7.9 billion.
In its Q3 2022 investor letter, Oakmark Funds, an asset management firm, highlighted a few stocks and Salesforce, Inc. (NYSE:CRM) was one of them. Here is what the fund said:
“Salesforce, Inc. (NYSE:CRM) has become a dominant global player in sales, customer service, commerce and marketing software over the past 20 years. The company earns 80% gross margins and grows 20% organically. Plus, virtually all of its revenue is recurring. We see Salesforce as a great business that we’ve admired from afar for a long time. More recently, the organization has made some changes at the top that prompted us to take a closer look at the stock. New CEO Bret Taylor and CFO Amy Weaver are bringing a culture of financial discipline. We believe this renewed focus on profitability and capital return, combined with Salesforce’s strong underlying business characteristics, will yield strong results. The current valuation of 3.9x next year’s revenues represents a significant discount compared to publicly traded peers and recent private market values in the software space that have similar growth profiles. This discount is an opportunity to invest in a great business at a good value.”
03. Apple Inc. (NASDAQ:AAPL)
Number of Hedge Fund Holders as of Q3, 2022: 140
Apple Inc. (NASDAQ:AAPL) designs, manufactures, and markets smartphones, personal computers, tablets, wearables, and accessories. Apple is one of the biggest companies in the world and has built a brand that billions of people around the world own and know about. The firm has grown revenues even in a macro slowdown and has the confidence of legendary value investors like Warren Buffett.
On November 8, UBS analyst David Vogt maintained a Buy rating on Apple Inc. (NASDAQ:AAPL) stock and lowered the price target to $180 from $185, noting that due to COVID-related complications, delivery dates are seen extending beyond Black Friday, though the impact is still estimated to be in the low single digits. At the end of the third quarter of 2022, 140 hedge funds in the database of Insider Monkey held stakes worth $144 billion in Apple Inc. (NASDAQ:AAPL), compared to 128 in the previous quarter worth $143 billion.
In its Q2 2022 investor letter, Alger Capital, an asset management firm, highlighted a few stocks and Apple Inc. (NASDAQ:AAPL) was one of them. Here is what the fund said:
“Apple Inc. (NASDAQ:AAPL) is a leading technology provider in telecommunications. computing and services. Apple’s iOS operating system is the company’s unique intellectual property and competitive strength. This software drives extremely tight engagement with consumers and enterprises. The engagement is fostering the growing purchase of high-margin services like music, apps, and apple pay. Apple’s shares detracted from performance as management lowered its guidance for the second quarter due to headwinds from the war in Ukraine, adverse foreign currency shifts, and dampened consumer demand associated with the coronavirus in China. Additionally, many investors were concerned that lockdowns implemented to curtail the spread of COVID-19 would impact the production of apple products, however, the manufacturing facilities have resumed activity.”
02. Visa Inc. (NYSE:V)
Number of Hedge Fund Holders as of Q3, 2022: 165
Visa Inc. (NYSE:V) is a payments technology company that provides debit and credit cards to banks for their customers. Like its rival, Mastercard, the firm also provides its customers the ability to generate analytics from transaction data. On December 2, Wells Fargo analyst Donald Fandetti maintained an Overweight rating on Visa Inc. (NYSE:V) stock and raised the price target to $250 from $225, noting that it is believed that the company is becoming even more entrenched in the global money movement ecosystem with their new products, making it even more difficult to disintermediate them in any meaningful way.
Insider Monkey studied 920 hedge fund portfolios for this year’s third quarter to determine that 165 had bought Visa Inc. (NYSE:V)’s shares. Out of these, Chris Hohn’s TCI Fund Management is Visa Inc. (NYSE:V)’s largest investor. It owns 19.9 million shares that are worth $3.5 billion.
In its Q2 2022 investor letter, Baron Funds, an asset management firm, highlighted a few stocks and Visa Inc. (NYSE:V) was one of them. Here is what the fund said:
“The Fund’s holdings in the Payments and Information Services themes also contributed to relative performance. Within Payments, lower exposure to this lagging theme and outperformance of Visa, Inc. (NYSE:V). These global payment networks are viewed as safe havens during market downturns but are also benefiting from resilient payment volumes and a sharp rebound in international travel.”
01. Microsoft Corporation (NASDAQ:MSFT)
Number of Hedge Fund Holders as of Q3, 2022: 269
Microsoft Corporation (NASDAQ:MSFT) develops, licenses, and supports software, services, devices, and solutions worldwide. On October 26, RBC Capital analyst Rishi Jaluria maintained an Outperform rating on Microsoft Corporation (NASDAQ:MSFT) stock and lowered the price target to $310 from $380, noting that several near-term headwinds are now expected to pressure operating margins in financial year 2023, which Microsoft management now expects to contract by a point.
At the end of the third quarter of 2022, 269 hedge funds in the database of Insider Monkey held stakes worth $61.2 billion in Microsoft Corporation (NASDAQ:MSFT), compared to 258 in the previous quarter worth $56 billion.
In its Q2 2022 investor letter, Baron Funds, an asset management firm, highlighted a few stocks and Microsoft Corporation (NASDAQ:MSFT) was one of them. Here is what the fund said:
“Shares of Microsoft Corporation (NASDAQ:MSFT), a leading global provider of software solutions, declined 16.6% in the quarter along with the broader software group as well as due to growing concerns of a potential macro-driven slowdown. This is despite the company posting strong quarterly financial results and successfully absorbing headwinds from the war in Ukraine. The company had 21% revenue growth, 23% operating income growth, and 35% growth in Microsoft Cloud (all year-over-year in constant currency), which now represents 47% of total revenues. (read more…)
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