Wed, November 16, 2022 at 12:57 PM·14 min read
The Gross Domestic Product (GDP) of the United States registered modest growth during the third quarter of 2022, per latest figures by the US government, even as consumer spending slowed due to soaring inflation. The latest numbers add to fears of a looming recession but are also encouraging with regards to claims by top economic experts that the US economy might avoid a full-blown crisis despite rising rates and slowed growth. The Fed has indicated it will continue to hike rates till inflation is brought under control.
These uncertain conditions have made the stock market more volatile, with even established names like Amazon.com, Inc. (NASDAQ:AMZN), Microsoft Corporation (NASDAQ:MSFT), and Meta Platforms, Inc. (NASDAQ:FB) featuring among the most active stocks as investors dump growth for value. Michael Gapen, the chief US economist for Bank of America, recently told The New York Times that growth rates were slowing and “it wouldn’t take much further slowing from here to tip the economy into a recession”.
Photo by Chris Liverani on Unsplash
Our Methodology
The companies that have high volumes were selected for the list. The analyst ratings of these firms and the latest updates related to them are also discussed to provide some additional context. Data from around 900 elite hedge funds tracked by Insider Monkey in the second quarter of 2022 was used to identify the number of hedge funds that hold stakes in each firm.
Most Active Stocks to Buy Now
12. SoFi Technologies, Inc. (NASDAQ:
SOFI)
Number of Hedge Fund Holders: 22
Volume as of November 14: 46.25 million
SoFi Technologies, Inc. (NASDAQ:SOFI) provides digital financial services. It is one of the most active stocks to buy now. On November 1, The company posted earnings for the third quarter of 2022, reporting losses per share of $1.05, beating market estimates by $0.01. The revenue over the period was $424 million, up 55.9% compared to the revenue over the same period last year and beating market estimates by $32.22 million.
On September 14, BofA analyst Mihir Bhatia upgraded SoFi Technologies (NASDAQ:SOFI) stock to Buy from Neutral with a price target of $9, up from $8, noting that the company has a potential growth path over the next few quarters through high profile national football league marketing.
At the end of the second quarter of 2022, 22 hedge funds in the database of Insider Monkey held stakes worth $337.6 million in SoFi Technologies, Inc. (NASDAQ:SOFI), compared to 22 in the preceding quarter worth $475 million.
Just like Amazon.com, Inc. (NASDAQ:AMZN), Microsoft Corporation (NASDAQ:MSFT), and Meta Platforms, Inc. (NASDAQ:FB), SoFi Technologies, Inc. (NASDAQ:SOFI) is one of the most active stocks to invest in.
In its Q4 2021 investor letter, Altron Capital Management, an asset management firm, highlighted a few stocks and SoFi Technologies, Inc. (NASDAQ:SOFI) was one of them. Here is what the fund said:
“We have been building our position in SoFi over the last two quarters but have not yet written about our thesis until now. SoFi Technologies, Inc. (NASDAQ:SOFI) is an online financial technology company that started off refinancing student loans. This segment remains a big part of the company’s business, but they have more recently expanded their products to offer an entire suite of financial services including personal banking, investing, and credit. While their collection of products is still evolving and not yet complete, we believe the company is in the early stages of its inflexion. The company nearly doubled its member count over the past year and is growing 50%+ despite its loan refinancing business taking a hit due to the COVID-related loan moratorium. Furthermore, the company is close to obtaining a bank charter through its acquisition of Golden Pacific Bancorp, a community bank based in Sacramento. A bank charter would allow SoFi to take in its customer deposits, lowering its cost of capital and expanding the company’s breadth of financial offerings.
While SoFi is not the only online banking platform out there, we believe it could take a decent share of the financial services market. Banking is a notoriously sticky business, as the inconvenience and hassle of switching banks prevent consumers from jumping to competitors regardless of cost. This is one of the reasons that traditional banks are one of the few businesses to have truly been disrupted by technology. We think SoFi is well on its way to changing that and creating a new paradigm for the future of consumer banking and financial services (read more)
11. NIO Inc. (NYSE:
NIO)
Number of Hedge Fund Holders: 25
Volume as of November 14: 66.94 million
NIO Inc. (NYSE:NIO) designs, develops, manufactures, and sells smart electric vehicles in China. It is one of the most active stocks to buy now. On October 27, Nio strengthened its strategic cooperation with SKF Automotive. SKF will be the preferred supplier of ceramic ball bearings and provide wide-ranging technical expertise to support NIO’s global expansion and product development plans.
On October 28, investment advisory Barclays maintained an Overweight rating on NIO Inc. (NYSE:NIO) stock and lowered the price target to $19 from $34. Analyst Jiong Shao issued the ratings update.
At the end of the second quarter of 2022, 25 hedge funds in the database of Insider Monkey held stakes worth $873.9 million in NIO Inc. (NYSE:NIO), compared to 26 in the previous quarter worth $716 million.
In its Q1 2022 investor letter, Horos Asset Management, an asset management firm, highlighted a few stocks and NIO Inc. (NYSE:NIO) was one of them. Here is what the fund said:
“At the beginning of April, the CSRC (China Securities Regulatory Commission) announced possible changes in its regulation that would allow this inspection by foreign auditors, provided that the companies previously communicate to this body the state secrets that would be exposed, as well as the sensitive information that they might have to hand over, and the subsequent audit is carried out in a framework of collaboration with the CSRC. In short, a move in the direction desired by the SEC, although still far from the optimal result, that is, unrestricted access to information. While these negotiations between the two regulatory bodies are progressing, Chinese companies have to decide how best to preserve their interests. Other entities, such as the electric vehicle manufacturer NIO Inc. (NYSE:NIO), have just started trading on this stock market.”
10. Vale S.A. (NYSE:
VALE)
Number of Hedge Fund Holders: 27
Volume as of November 14: 51.76 million
Vale S.A. (NYSE:VALE) produces and sells iron ore and iron ore pellets for use as raw materials in steelmaking. It is one of the most active stocks to buy now. On November 1, Vale disclosed that it has signed a memorandum of understanding with Saudi Arabia’s National Development Center to study the development of a 4 million metric tons per year iron ore pellet plant in Ras Al Khair.
On October 5, Deutsche Bank analyst Liam Fitzpatrick maintained a Hold rating on Vale S.A. (NYSE:VALE) stock and lowered the price target to $19 from $20, noting that the reduced targets in the prices and earnings estimates of metals and mining reflect weakening demand and macro risks.
At the end of the second quarter of 2022, 27 hedge funds in the database of Insider Monkey held stakes worth $1.8 billion in Vale S.A. (NYSE:VALE), compared to 27 in the previous quarter worth $2.4 billion.
9. Snap Inc. (NYSE:
SNAP)
Number of Hedge Fund Holders: 44
Volume as of November 14: 58.82 million
Snap Inc. (NYSE:SNAP) operates as a camera company in North America, Europe, and internationally. It is one of the most active stocks to buy now. On October 27, Snapchat said that it is giving users more powerful video tools through a new feature called Director Mode. The mode is available for all iOS users and with limited Android availability. People can use Director Mode to make content to share with friends and post in the spotlight.
On October 21, Canaccord analyst Maria Ripps maintained a Hold rating on Snap Inc. (NYSE:SNAP) stock and lowered the price target to $12 from $16, noting that the company reported mixed Q3 results.
At the end of the second quarter of 2022, 44 hedge funds in the database of Insider Monkey held stakes worth $834.8 million in Snap Inc. (NYSE:SNAP), compared to 54 in the previous quarter worth $2.7 billion.
In its Q3 2022 investor letter, RiverPark Funds, an asset management firm, highlighted a few stocks and Snap Inc. (NYSE:SNAP) was one of them. Here is what the fund said:
“Snap Inc. (NYSE:SNAP) shares were our top detractor for the quarter on its July decline from weaker revenue growth relative to guidance (which had been reduced in May) and the fact that management did not provide an outlook for 3Q. Shares subsequently rebounded somewhat as the company announced better-than-expected near-term revenue growth while announcing a broad-based cost restructuring.
Although the company continues to face near-term macro headwinds and difficult year-over-year comparisons from COVID-fueled quarters last year, we believe SNAP can reaccelerate its revenue growth to greater than 20% annually over the next several years. With TTM revenue of $4.5 billion (as compared with Meta’s $120 billion), 347 million daily average users (about 1/10 of Meta’s), and $14 TTM ARPU (about 1/3 of Meta’s), we believe SNAP has a long runway for both revenue growth and expanded profitability as it improves its platform functionality, continues to grow its audience (daily active users continue to grow at a double-digit rate), and expands its monetization.”
8. Ford Motor Company (NYSE:
F)
Number of Hedge Fund Holders: 46
Volume as of November 14: 66.59 million
Ford Motor Company (NYSE:F) designs, manufactures, markets, and services a range of Ford vehicles. It is one of the most active stocks to buy now. On October 31, Ford disclosed that it has reduced the price of its Mustang Match E models in China by as much as RMB 28,000. On October 31, Ford announced its opening of a new global technology and business center in Mexico’s capital with an investment of $260 million.
Among the hedge funds being tracked by Insider Monkey, Chicago-based investment firm Citadel Investment Group is a leading shareholder in Ford Motor Company (NYSE:F) with 29 million shares worth more than $323 million.
In its Q1 2022 investor letter, Baron Funds, an asset management firm, highlighted a few stocks and Ford Motor Company (NYSE:F) was one of them. Here is what the fund said:
“Ford (NYSE:F) is another example of a typical industrial manufacturing business executive mindset. April 18, 2022, Bloomberg Businessweek cover story features Ford CEO Jim Farley behind the wheel of an electrified Ford F-150 Lightning. The article is titled, “Hey Elon, THIS is a truck.” I thought the article was terrific. One idea especially stood out to me. Since the F-150 is such a popular vehicle, it “argued for a gradual approach to electrification. Essentially the company retrofitted an existing F-150 with an electric powertrain rather than develop an entirely new truck.” No all-in financial and operation bet by this company on electrification.”
7. Micron Technology, Inc. (NASDAQ:
MU)
Number of Hedge Fund Holders: 69
Volume as of November 14: 19.36 million
Micron Technology, Inc. (NASDAQ:MU) designs, manufactures, and sells memory and storage products worldwide. It is one of the most active stocks to buy now. On September 12, Sanjay Mehrotra, the CEO of the firm, told news agency Reuters that the company was breaking ground on the newly announced $15 billion factory in Idaho and would unveil another US-based plant soon. The executive added that both plants will produce dynamic random access, or DRAM chips, used for data centers, PCs and other electronics.
On September 21, Wells Fargo analyst Aaron Rakers maintained an Overweight rating on Micron Technology, Inc. (NASDAQ:MU) stock lowered the price target to $75 from $90, noting the setup into the fourth quarter results of the firm was negative.
At the end of the second quarter of 2022, 69 hedge funds in the database of Insider Monkey held stakes worth $2.2 billion in Micron Technology, Inc. (NASDAQ:MU), compared to 78 in the preceding quarter worth $3.4 billion.
In its Q2 2022 investor letter, Meridian Funds, an asset management firm, highlighted a few stocks and Micron Technology, Inc. (NASDAQ:MU) was one of them. Here is what the fund said:
“Micron Technology, Inc. (NASDAQ:MU) is a leader in the production of DRAM and NAND memory. We invested in the stock in the third quarter of 2019 during a cyclical downturn in the memory industry. Our rationale was that, while the memory industry is cyclical, we believed there are strong secular drivers in place that will lead to higher peaks and long-term growth. Our secular thesis is based on our conviction that the quest for ever-increasing compute speeds will increasingly rely on memory to solve bottlenecks and that increased memory content in nearly everything from mobile phones to automobiles will drive demand. Micron’s stock traded lower during the quarter due to macroeconomic concerns that led to lower earnings expectations. We increased our stake in the company, as we believe our secular thesis remains intact. We wanted to take advantage of what we view as temporary cyclical concerns that caused the stock to trade at less than 10x reasonable trough earnings per share (EPS) estimates and less than 7x recent peak EPS.”
6. Tesla, Inc. (NASDAQ:
TSLA)
Number of Hedge Fund Holders: 72
Volume as of November 14: 87.11 million
Tesla, Inc. (NASDAQ:TSLA) designs, develops, manufactures, leases, and sells electric vehicles, and energy generation and storage systems. On November 1, Tesla revealed that it had planned the mass production of its Cybertruck by the end of 2023. On November 1, Tesla said that it is sending its engineers and production staff from its recently upgraded Shanghai factory to its plant in Fermont, California.
On October 24, Morgan Stanley analyst Adam Jonas maintained an Overweight rating on Tesla, Inc. (NASDAQ:TSLA) stock and lowered the price target to $330 from $350, noting that the third quarter earnings of the firm were in line with consensus expectations.
At the end of the second quarter of 2022, 72 hedge funds in the database of Insider Monkey held stakes worth $7.2 billion in Tesla, Inc. (NASDAQ:TSLA), compared to 80 in the preceding quarter worth $11.3 billion.
Alongside Amazon.com, Inc. (NASDAQ:AMZN), Microsoft Corporation (NASDAQ:MSFT), and Meta Platforms, Inc. (NASDAQ:FB), Tesla, Inc. (NASDAQ:TSLA) is one of the most active stocks to invest in.
In its Q2 2022 investor letter, Baron Funds, an asset management firm, highlighted a few stocks and Tesla, Inc. (NASDAQ:TSLA) was one of them. Here is what the fund said:
“In 2014, before we began to invest in Tesla (NASDAQ:TSLA), I called Roger to ask whether he thought Elon Musk’s electric car business would succeed. I did not believe that Roger, an owner of dealerships that sell cars powered by internal combustion engines (ICE) would likely have a favorable opinion of Tesla’s prospects. That was principally for two reasons:
First, automobile manufacturing and distribution is unusually complicated, capital intensive, and highly regulated, which makes profitability problematic;
second, cars with ICE motors require extensive annual maintenance, and dealer services revenues, not profits from automobile sales, are the most important contributor to profits of perpetual licensed ICE car dealerships.
Penske Automotive Group is principally an ICE car dealer. Since electric cars are powered by batteries and need little service, franchised dealerships are incented to sell ICE, not EV automobiles. Further, Roger had been a long-term director of General Motors. General Motors’ ICE automobile business would be disrupted if Tesla were successful. (click here to read more…)
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Disclosure. None. 12 Most Active Stocks to Buy Now is originally published on Insider Monkey.