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In this article, we look at the 12 best breakout stocks to buy right now. If you would like to skip coverage of the latest stock market news, please follow the link below. The 5 best breakout stocks to buy right now.
The stock market in 2024 is more optimistic and forward-looking than it was at the beginning of last year. At the time, investors were concerned about the state of the U.S. economy and the impact that the Federal Reserve’s high interest rates would have on the U.S. economy. But as 2023 showed, and to everyone’s surprise, the U.S. economy did not go into recession, nor did the stock market decline and wealth disappear.
Instead, NVIDIA Corporation (NASDAQ:NVDA), Microsoft Corporation (NASDAQ:MSFT) and other big-ticket technology names soared after OpenAI’s ChatGPT convinced the world that AI is walking among us And AI has become ubiquitous.
In fact, February 2024 marked the first time in history that the flagship S&P 500 index exceeded 5,000 points. As if that wasn’t enough, the tech-heavy Nasdaq Composite Index rose to near all-time highs during the month, before paring the breakout. At the heart of this incredible performance is, you guessed it, AI. The beginning of this year saw the emergence of industry heavyweights, including Mark Zuckerberg, head of Meta Platforms, Inc. (NASDAQ: META), and Jensen Huang, head of NVIDIA. , OpenAI’s eccentric Sam Altman will all be on stage, reaffirming his optimism for the artificial intelligence industry.
Zuckerberg got the ball rolling, sharing his company’s plans to buy hundreds of thousands of GPUs from NVIDIA this year to boost Meta’s computing power. Since this article is about breakout stocks, the meta is especially important as far as 2024 is concerned. This is because the company’s stock price exhibits the typical characteristic of a sudden breakout triggered by a trigger. Still, while Meta chief’s GPU comments were welcome, the real surge in the company’s stock came after its Q4 2023 earnings report. In this report, the company reported an unexpected dividend of 50 cents. Meta’s stock price has risen 18% since the earnings release, making it a classic example of a breakout stock.
But when we talk about breakout stocks in the AI era, the crown still rests firmly on NVIDIA and Mr. Huang. NVIDIA’s stock price has already risen 49.9% year-to-date amid a series of explosive results, and NVIDIA has temporarily fallen behind big technology stocks Amazon.com, Inc. (NASDAQ:AMZN) and Alphabet. Inc. (NASDAQ:GOOG).
Similarly, another breakout stock that has soared recently is also related to artificial intelligence and has close ties to NVIDIA. This stock is none other than British semiconductor design company Arm Holdings plc (NASDAQ:ARM). Arm was one of the youngest entrants to the stock market, and before its shares went public, NVIDIA was looking to acquire the company before regulators scuppered its plans. The decision to go public appears to have turned out well for Arm, as Arm is a fast-growing stock that has risen 145% since his IPO.
So why is Arm soaring? Well, all the company had to do was convince investors that AI-related orders were in the works, and the stock was sold. Arm’s latest financial results announcement contained many references to AI, with management commenting as follows:
More and more AI is powering more end devices, from the NVIDIA Grace Hopper 200, the most complex device on the planet for training and inference, to edge devices like Google’s Gemini Nano Pixel 6 and Samsung Galaxy S24. is running. That’s all. Runs on the arm. And that has provided a very strong tailwind for our licensing growth. If you look at the demand for new products from a licensing perspective, what you’re seeing from the end market is that the technology is not up to par relative to its capabilities, and the end customers of new designs will need more and more products. That is to say. Arm technology specifically addresses the demands of AI.
Looking at these trends, we can see that the stock market gods are quite favorable when it comes to breakout stocks. Therefore, today we have created a list of such stocks. At the top of the list are Salesforce, Inc. (NYSE:CRM), NVIDIA Corporation (NASDAQ:NVDA), and Adobe Inc. (NASDAQ:ADBE).
Image by Gerd Altmann from Pixabay
our methodology
To create our list of the best breakout stocks, we ranked the holdings of the IBD Breakout Opportunities ETF by the number of hedge funds that bought the stock in Q4 2023. From these, the top breakout stocks were selected.
For these top breakout stocks, we used hedge fund sentiment. The top 10 consensus stocks selected by hedge funds have outperformed the S&P 500 index by more than 140 percentage points over the past 10 years (Please see here for the detail). That’s why we pay close attention to this often ignored metric.
Best breakout stocks to buy now
12. Shopify Inc. (NYSE:SHOP)
Number of hedge fund investors in Q4 2023: 68
Shopify Inc. (NYSE:SHOP) is a Canadian e-commerce retailer headquartered in Ontario. Despite widespread inflation concerns weighing on the e-commerce company’s market, the company has performed well financially recently, beating analyst EPS estimates in each of the last four quarters.
As of the end of December 2023, 68 of the 933 hedge funds surveyed by Insider Monkey were shareholders of Shopify Inc. (NYSE:SHOP). The largest shareholder was Peter Rajens, Bruce Clark and John Campbell’s ArrowStreet Capital, with a stake worth $1.6 billion.
11. KKR & Co. Inc. (NYSE:KKR)
Number of hedge fund investors in Q4 2023: 68
KKR & Co. Inc. (NYSE:KKR) is a financial services company headquartered in New York City. With high interest rates clouding the investment environment, the firm released a new report in February 2024, revealing that family office investment vehicles have begun to reduce equity investments.
Insider Monkey examined the investment portfolios of 933 hedge funds in Q4 2023 and found that 68 funds include KKR & Co. Inc. (NYSE:KKR) as an investment. . The company’s largest shareholder in our database is Harris Associates of Natixis Global Asset Management, with US$1.7 billion worth of shares.
NVIDIA Corporation (NASDAQ:NVDA), Salesforce, Inc. (NYSE:CRM), Adobe Inc. (NASDAQ:ADBE), and KKR & Co. Inc. (NYSE:KKR) are top breakout stocks that hedge funds are also piling into . Inside.
10. Fiserv Inc. (NYSE:FI)
Number of hedge fund investors in Q4 2023: 73
Fiserv, Inc. (NYSE:FI) is a financial technology company that enables businesses to manage payments. The stock has an average rating of “Strong Buy” and an average analyst price target of $156.94.
In terms of stock holdings in Q4 2023, 73 out of 910 hedge funds surveyed by Insider Monkey held shares in the company. The largest investor in Fiserv, Inc. (NYSE: FI)’s database is Harris Associates of his Natixis Global Asset Management with $1.9 billion in shares.
9. MercadoLibre, Inc. (NASDAQ:MELI)
Number of hedge fund investors in Q4 2023: 81
MercadoLibre, Inc. (NASDAQ:MELI) is an e-commerce company based in Uruguay. Currently trading at a low price of $1,692 per share, this is one of the most expensive stocks on our list. Like other companies, the company jumped on the AI train after partnering with ERP giant SAP in February 2024 to integrate generative artificial intelligence into its operations.
Insider Monkey examined 933 hedge funds’ portfolios and found 81 investors in MercadoLibre, Inc. (NASDAQ:MELI) at the end of Q4 2023. David Blood and Al Gore’s Generation Investment Management became the largest stakeholder through a $673 million investment.
8. Workday, Inc. (NASDAQ:WDAY)
Number of hedge fund investors in Q4 2023: 81
Workday, Inc. (NASDAQ:WDAY) is a technology company that provides a variety of cloud computing services for businesses. The company’s stock has an average buy rating, and the company has performed well financially recently, beating analyst EPS estimates in each of the last four quarters.
During the December quarter of last year, 81 of the 933 hedge funds profiled by Insider Monkey were shareholders. Workday, Inc. (NASDAQ: WDAY)’s largest investor is Andreas Halvorsen’s Viking Global, which owns his 4.1 million shares worth $1.1 billion.
7. Intuitive Surgical (NASDAQ:ISRG)
Number of hedge fund investors in Q4 2023: 82
Intuitive Surgical, Inc. (NASDAQ:ISRG) is a back-end healthcare company whose surgical robotics platform is among the best in the world. The company announced last month that it would introduce a new robotic surgery platform later this year.
By the end of last year’s fourth quarter, 82 of the 933 hedge funds tracked by Insider Monkey held shares in Intuitive Surgical, Inc. (NASDAQ:ISRG). Ken Fisher’s Fisher Asset Management held the largest stake, valued at $1.5 billion.
6. Booking Holdings, Inc. (NASDAQ:BKNG)
Number of hedge fund investors in Q4 2023: 83
Booking Holdings Inc. (NASDAQ:BKNG) is a travel services provider that enables travelers to digitally manage their travels by booking accommodations. The company is in good financial shape, beating analyst EPS estimates in each of the last four quarters.
Of the 933 hedge funds included in Insider Monkey’s Q4 2023 database, 83 were shareholders of the company. Booking Holdings (NASDAQ: BKNG)’s largest investors are Peter Rajens, Bruce Clark, and John Campbell’s Arrow Street Capital through their $1.7 billion investment.
Salesforce, Inc. (NYSE:CRM), Booking Holdings Inc. (NASDAQ:BKNG), NVIDIA Corporation (NASDAQ:NVDA), and Adobe Inc. (NASDAQ:ADBE) are top hedge fund breakout stocks It is listed in.
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Disclosure: None. 12 Best Breakout Stocks to Buy Now Originally published on Insider Monkey.
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