Best Robinhood Stocks To Buy Or Watch Now

Buying a stock is deceptively easy, but purchasing the right stock at the right time without a proven strategy is incredibly hard. So, what are the best Robinhood stocks to buy now or put on a watchlist? At the moment, Berkshire Hathaway (BRKB), Visa (V) and Walmart (WMT) are standout performers, at least relatively.


Unlike meme stocks such as GameStop (GME) and AMC Entertainment (AMC), these stocks offer a mix of solid fundamental and technical performance.

Best Robinhood Stocks To Buy: The Crucial Ingredients

There are thousands of stocks trading on the NYSE and Nasdaq. But to generate big gains you have to find the very best. The best Robinhood stocks for investors will be those that offer a mix of earnings and stock market performance.

The CAN SLIM system offers clear guidelines on what you should be looking for. Invest in stocks with recent quarterly and annual earnings growth of at least 25%. Look for companies that have new, game-changing products and services. Also consider not-yet-profitable companies, often recent IPOs, that are generating tremendous revenue growth.

The Market Is Key When Buying Robinhood Stocks

A key part of the CAN SLIM formula is the M, which stands for market. Most stocks, even the very best, follow the market direction. Invest when the stock market is in a confirmed uptrend and move to cash when the stock market goes into a correction.

A stock market rally that kicked off 2022 soon fell on its face. The market overall has been choppy since then, with bear market rallies often being undercut by painful drawdowns. Recent bullish action has seen the Nasdaq and the S&P 500 move back above their major moving averages, though recent volatility has also increased risk.

The stock market is back in a confirmed uptrend. This means it is the best time to be buying fundamentally strong stocks breaking out of proper base patterns, such as those in the IBD 50. These names will tend to have rising relative strength lines. The stocks below are good candidates. It’s also a good time to add to existing holdings at follow-on opportunities

The choppiness of the market means it is crucial to stay on top of sell signals. Any stock that falls 7% or 8% from your purchase price should be jettisoned. Also beware of sharp breaks below the 50-day or 10-week moving averages.

Remember, there is still significant headline risk. Inflation remains a key issue while the Russia-Ukraine conflict is a wild card that has proved its ability to shake the market.

Things can quickly change when it comes to the stock market. Make sure you keep a close eye on the market trend page here.

Best Robinhood Stocks To Buy Or Watch

Now let’s look at Google stock, Visa stock and Walmart stock in more detail. An important consideration is that these stocks are solid from a fundamentals perspective, while institutional ownership is also strong. They are also part of the Robinhood Top 100 Stocks, the platform’s most popular stocks among traders.

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Berkshire Hathaway Stock

The ultimate Warren Buffett stock briefly tested a new cup-with-handle buy point of 331.42. BRKB stock has moved off its 21-day line, where it had been finding support amid tight weekly action.

One could view this handle as a mini-consolidation within the buy zone of a bottoming base with a 321.42 entry.

BRKB stock’s relative strength line is trying to move higher again after slipping from a 52-week high.

BRKB stock has seen its IBD Composite Rating shoot up to a strong 90 out of 99. Unlike many stocks, Berkshire Hathaway stock held strong in 2022 making a slight gain compared to a loss of more than 19% for the S&P 500. It is up around 7% so far in 2023.

It boasts a good mix of stock market and earnings performance. Earnings are an area of strength, with the stock holding an EPS Rating of 84 out of 99. Earnings popped by 14% in the most recent quarter. They have grown by an average of 10% over the previous three quarters, not ideal by CAN SLIM standards.

Berkshire Hathaway is a conglomerate that owns some of America’s most famous firms. It wholly owns the likes of Geico, Duracell, Dairy Queen, Fruit of the Loom and railroad operator BNSF.

Berkshire Hathaway is perhaps more famous for serving as an investment vehicle for Warren Buffett and his top lieutenant, Charlie Munger. Following their value investing philosophy, the company owns huge stakes in American Express (AXP), Coca-Cola (KO) and other heavy hitters.

Under investment managers Todd Combs and Ted Weschler, Berkshire Hathaway has been increasingly sinking money into tech. It’s taken large positions in established giants like Apple (AAPL), as well as younger companies like Brazilian payments company StoneCo (STNE) and software firm Snowflake (SNOW). Berkshire also snapped up a stake in (AMZN).

In Q1, Berkshire Hathaway snapped up shares in Capital One Finance (COF) for the first time. At the same time, Berkshire sold off its remaining stake in Bank of New York Mellon (BNY) and U.S. Bancorp (USB), continuing a trend of dumping several bank stocks of late. The firm also closed its position Taiwan Semiconductor (TSM) amid rising geopolitical tensions.

Buffett also added to the positions of his two largest stock holdings, Apple (AAPL) and Bank of America (BAC).

CFRA analyst Catherine Seifert is rating BRKB stock as a hold with a 356 price target.

“Berkshire’s premium valuation — versus the broader market and the company’s historical averages — is dependent upon its ability to produce revenue growth and operating profit margins that are superior to broader averages,” she said in a May 8 research note. Berkshire’s recent financial results have been mixed, and we expect results at several of its economically sensitive business to be under pressure in 2023, though higher investment income will likely offset some of these strains.”

She also expects the firm to deploy its massive cash pile going forward. She said she sees “acquisitions and/or share buybacks remaining part of Berkshire’s capital allocation strategy.”

Of course, one of the biggest questions around the future of Berkshire Hathaway in recent years was who would take over the mantle of CEO from Buffett.

The Oracle of Omaha has given the answer. He said Greg Abel, who runs the noninsurance businesses, will take over in his stead.

Visa Stock

Payments giant Visa is in the buy zone from a 230.05 handle buy point within a double-bottom base. Investors could also wait for the stock to pass its recent high of 235.57 amid tight recent action. That could become a flat base in another week.

The relative strength line has been moving sideways of late. V is currently above all its moving averages.

All-around performance here is stellar, with its IBD Composite Rating coming in at 94 out of 99.

Earnings growth is also impressive, with EPS rising by an average of 19% over the past three quarters.

Gains are seen moderating somewhat. EPS is expected to climb 15% in 2023 before rising an additional 14% in 2024.

Institutional investors certainly seem impressed with its prospects, with its Accumulation/Distribution Rating coming in at B+. In total, 51% of its stock is currently held by funds.

Visa recently posted earnings of $2.09 a share on revenue of $7.98 billion, topping analyst views. Strong travel trends worldwide are fueling transaction growth.

International transaction revenue surged 24% to $2.75 billion, just above forecasts of $2.73 billion. Data processing revenues jumped 10% to $3.82 billion, slightly lower than views for $3.77 billion.

Visa has posted eight straight quarters of sales and earnings gains.

In addition, Visa looks to have emerged unscathed from the recent banking crisis sparked by the failure of Silicon Valley Bank.

The event sent shock waves through financial markets, with midsize banks bearing the brunt of losses during the March mayhem.

Credit card rivals like Mastercard (MA) and American Express (AXP) faced more modest declines.

“Things have been completely normal,” Visa Chief Financial Officer Vasant Prabhu said at the Wolfe Research conference on March 15. “Debit and credit cards have been usable, without any disruption whatsoever. They’re settling every night. So, really, no impact whatsoever.”

The key point here for investors is that payment processors Visa and Mastercard do not carry card balances on their books. This is in contrast to American Express and Discover Financial (DFS).

Instead it is the issuing banks such as JPMorgan Chase (JPM) and Wells Fargo (WFC) that carry the upside and downside on the provision of credit. Visa and Mastercard make money on credit and debit card transaction fees.

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Walmart Stock

Walmart stock sits inside a buy zone after moving back above a double-bottom base entry of 148.44. Investors could view 153.85 as a handle entry to the six-month consolidation. It has also tested this level multiple times.

Earlier in the week, WMT stock found support at the 10-week line, just above the 148.44 buy point.

The relative strength line for Walmart stock has been trending upward for the past few months. This line gauges a stock’s performance vs. the broader S&P 500.

Overall performance is strong, with WMT holding an IBD Composite Rating of 90 out of 99.

Earnings in particular are impressive, with its EPS Rating a strong 90 out of 99. On Thursday the firm reported a 13% jump in its adjusted earnings to $1.47 per share on 7.6% revenue growth to $152.3 billion.

Analysts expected Walmart earnings to edge up 1.5% to $1.32 per share on a 5.1% increase in revenue to $148.8 billion. Comparable sales, excluding fuel, increased 7.4%, up from 3% growth last yeah but down from 8.3% in the fourth quarter. FactSet projected 5.5% comparable sales growth.

Walmart also raised its fiscal 2024 guidance following the report. It now expects adjusted earnings between $6.10 to $6.20 per share, up from its previous forecast of $5.90 to $6.05 per share. It also guided for Q2 adjusted earnings between $1.63 to $1.68 per share on 4% net sales growth. This was lower than FactSet expectations of $1.71 per share.

Since the start of the year Walmart stock is up about 6%. This slightly lags S&P 500’s gain of over 8%. It is in the top 16% of stocks in terms of price performance over the past 12 months.

Jefferies analyst Corey Tarlowe is rating Walmart stock as a buy with a 175 target. He believes the firm’s Walmart+ program is a “huge value proposition.”

Walmart+ costs $12.95 a month, or $98 a year. The program’s benefits can be used, in one way or another, at more than 4,700 stores. The service will offer free delivery on items, at in-store prices, with 2,700 stores capable of offering same-day delivery.

Please follow Michael Larkin on Twitter at @IBD_MLarkin for more on growth stocks and analysis.


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