Q4 Institutional Buying Highlights Four Stocks with Growth Potential
Institutional investing plays a crucial role in helping retail investors gauge market sentiment for individual stocks or assets. Hedge funds, advisors, and other institutional investors deploy teams of analysts to assess assets for client recommendations.
By tracking which shares institutional clients are purchasing regularly, retail investors can leverage this research to inform their own investment strategies.
Below is an analysis of four stocks that experienced substantial institutional buying in Q4 2025, each garnering at least $1 billion in purchases. This activity may indicate these stocks’ potential long-term value.
HEICO Experiences Significant Surge in Investor Activity
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In Q4 of 2024, few stocks saw a rise in attention like HEICO (NYSE: HEI), with share prices increasing by 13% since the last business period closed.
Institutional buying skyrocketed from $45 million to $5.63 billion during the fourth quarter, suggesting heightened interest from major players like Polar Asset Management and Emerald Advisers.
This optimism follows HEICO’s recent performance, where it surpassed consensus EPS estimates by $0.27 per share, validating this confidence in the short term.
Analysts currently rate HEICO as a Moderate Buy, projecting an additional 3.61% upside over the upcoming year.
Occidental Petroleum’s Price Decline Creates Investor Interest
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Occidental Petroleum (NYSE: OXY), a leading oil and gas company, has experienced a consistent downward trend in share prices, decreasing by 26% over the past year.
Recent downgrades from analysts have compounded this decline, causing shares to drop an additional 8% just this week. Consequently, OXY’s P/E ratio has fallen below 20, a threshold not seen in years.
Despite these challenges, institutional investors acquired $1.69 billion in OXY shares in Q4, an increase from $659 million in Q3 2024.
While analysts rate this stock as a Hold, the consensus price estimates for the next year suggest a potential upside of more than 31%. This confidence is bolstered by the company’s latest earnings release, which exceeded expectations by $0.13 per share.
Merck & Co. Offers Attractive Dividends and Growth Potential
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Merck & Co., Inc. (NYSE: MRK), another major player with a recently depressed P/E ratio, continues to attract institutional buying.
Currently trading near its 52-week low of approximately $93 per share, analysts foresee a potential price upside of 25%, supported by a P/E ratio of 13.84.
Institutional investments reached $13 billion in Q4, a stark increase from $4.65 billion in Q3.
For dividend investors, Merck stands out with a competitive 3.48% dividend yield, sustained by a 48.14% payout ratio. Notably, the company has raised its annual dividend for the past 14 years, enhancing its income-generating appeal.
Prudential Financial Presents Risk with Growth Potential
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Prudential Financial (NYSE: PRU), part of the S&P 500, could be a suitable choice for retail investors with a higher risk tolerance. The stock is currently trading at a new 50-day low of about $109 per share.
A recent miss in earnings estimates has led to a 12% dip in share prices over the past month, but buying trends suggest that some institutional investors see this as an overreaction.
In Q4 of 2024, institutional purchases totaled $1.17 billion, compared to $486 million in Q3.
With a newly adjusted P/E ratio of 14.71 and a higher-than-average 4.91% dividend yield, the current downturn might offer retail investors an attractive buying opportunity. Nevertheless, it’s essential to note the growing short interest in shares, which has increased by more than 6.5% since last month.
Before making any trading decisions, consider this.
MarketBeat monitors the most respected Wall Street analysts and the stocks they recommend to clients daily. Our team has pinpointed five stocks that top analysts are discreetly suggesting to buy before the broader market takes notice—none of which are major names.
They believe these five stocks represent the top investment opportunities available right now…
The views and opinions expressed herein are those of the author and do not necessarily reflect those of Nasdaq, Inc.
