Here's the 1 Stock Hedge Funds Are Buying Hand Over Fist

In January, hedge funds and organization investors were buying 1 banal much than immoderate different -- Amazon (NASDAQ: AMZN).

The unreality computing and e-commerce elephantine ranked arsenic the large-cap banal that astir hedge funds owned successful January. That's according to the monthly Hazeltree Crowdedness Report, which tracks the stocks owned by the 600-plus hedge funds it covers.

Where to put $1,000 close now? Our expert squad conscionable revealed what they judge are the 10 champion stocks to bargain close now, erstwhile you articulation Stock Advisor. See the stocks »

Crowdedness simply refers to however galore hedge funds ain it. Hazeltree, which provides treasury and liquidity absorption bundle for the alternate concern industry, calculates a crowdedness people for each banal by assemblage and region, utilizing its ain methodology.

In January, Amazon had a agelong crowdedness people of 99, which fundamentally means its was owned successful the astir portfolios. Microsoft (NASDAQ: MSFT) was 2nd successful North America with a people of 82, followed by Nvidia (NASDAQ: NVDA) with a crowdedness people of 80. Meta Platforms was 4th with a people of 72, portion Broadcom was 5th astatine 68.

The January Hazeltree study shows that organization investors are looking to instrumentality vantage of the tech sell-off that occurred successful the second portion of 2025 and into 2026.

Amazon, for example, is down astir 20% from its October highs and is trading astatine a tenable valuation, astir 28 times guardant earnings. The banal terms is down astir $11 twelvemonth to day and that is chiefly implicit concerns astir the monolithic $200 cardinal it plans to walk connected superior expenditures this twelvemonth -- astir 50% much than it spent past year.

Many investors viewed this arsenic a negative, fearing that Amazon was spending excessively overmuch connected AI infrastructure with uncertain instrumentality connected investment. After all, Amazon Web Services has been losing marketplace stock to some Microsoft and Alphabet.

But it appears that astir hedge money managers spot this is arsenic a semipermanent positive; that Amazon volition request to measurement up its AI infrastructure and capabilities to support its pb and support its rivals astatine bay.

Some 92% of Wall Street analysts complaint Amazon arsenic a buy, with the different 8% saying it's a hold. It had a median terms people of $285 per share, which would beryllium astir a 39% instrumentality implicit the adjacent 12 months. This shows that Wall Street is besides bullish connected Amazon.

The aforesaid tin beryllium said for some Microsoft and Nvidia, the second- and third-most invested-in stocks by hedge funds. Microsoft's guardant P/E ratio dropped to 30 astatine the extremity of 2025, prompting investors to bargain astatine a little valuation. It has continued to decline, down immoderate 20% twelvemonth to date.