Stocks to buy

3 Stocks to Buy That the ‘Dumb Money’ Loves

Following what billionaires and investing gurus are doing isn’t a bad strategy. Looking at their top stocks to buy is at least a good first step for beginning your investment journey. But if always blindly buying what they bought was a successful strategy, we’d all be millionaires. Quite often, the smartest guys in the room are dunces. It’s why you need to do your own due diligence. This has led to the rise of stocks loved by dumb money.

But sometimes, buying stocks loved by “dumb money” can be just as good of a strategy. The wisdom of crowds can pay off handsomely. That doesn’t change the fact you still need to do your own homework. Don’t follow anyone’s advice — including my stock suggestions — without first looking deeper into them.

But the following three “dumb money” stocks are ones you just might want to consider.

Broadcom (AVGO)

Source: Broadcom

Telecom chipmaker Broadcom (NASDAQ:AVGO) is riding a boom of investor support. Shares are up 40% in the past three months and 60% in the last year. 

Driving that support is the ongoing rollout of 5G networks by wireless companies and the infrastructure to support it. Broadcom makes next-generation chips used in smartphones. Semiconductor solutions represented 78% of revenue last year.

Broadcom is also tapping into the emergence of generative AI and arguably the most well-known application it represents, Open AI’s ChatGPT. Through its Symantec unit, the chipmaker estimates the revenue opportunity from AI is about 15% of its chip business. Management believes that could grow to over $1 billion in the third quarter and rise to as much as 25% of the total next year.

Broadcom’s Jericho3-AI chip can connect up to 32,000 graphics processing units (GPUs) running at 800 gigabits per second bandwidth. That could make it a key player in the burgeoning data center market. 

There will be strong adoption of this technology. As Broadcom notes, “Enterprises that don’t embrace it will be at a severe disadvantage.” With a long runway of growth before it, the chipmaker is a stock rightly loved by the dumb money.

Meta Platforms (META)

Source: Blue Planet Studio /

Facebook owner Meta Platforms (NASDAQ:META) is no slouch when it comes to retail investor backing. While the stock is up 34% over the past quarter, it’s 160% higher so far this year.

The triumvirate of social media platforms — Facebook, Instagram, and WhatsApp — is a powerhouse of opportunity. The family of platforms has over 3 billion daily active users (DAU), a 7% increase from last year. This makes it one of those stocks loved by dumb money.

More importantly, advertising is making a comeback. Ad impressions and price per impression rose 34% year over year, though the average price per ad declined 16%. Meta revenue was 11% higher in the first quarter to $32 billion.

Meta is also going after Twitter with its new app Threads. It signed up 100 million users in just five days of its launch. Admittedly, allowing existing platform users to simply click a button to join doesn’t give a true sense of demand. According to Sensor Tower, daily active users of the new app are falling at about 1% per day in the weeks following its debut. It’s still early days though and could represent a new stream of ad revenue for the social media company.

And let’s not forget Meta’s own involvement in an alternate reality. It was the reason the company changed its name from Facebook to Meta. The metaverse could have enormous potential. Some analysts think it could run into the trillions of dollars.

All of this is to say the dumb money is backing Meta Platforms for good reason. It’s a stock you might want to put on your list too.

Palantir Technologies (PLTR)

Source: Iljanaresvara Studio /

Palantir Technologies (NASDAQ:PLTR) went from a spy agency support business to a mainstream data analytics company. In between, it also became a meme stock star. It then lost its luster.

Shares of the big data firm plunged 85% from peak to trough. But 2023 is different. The dumb money climbed aboard and the stock is up 120% in just three months. It is down 15% off its recent highs, but there’s still plenty of room to run higher.

Commercial revenue grew 10% in the second quarter with a 20% gain in the U.S. Government revenue was 15% higher with international governments spending 31% more. It also had 38% more customers than last year and 8% more than in the first quarter.

Palantir is not one to miss out on big trends either. CEO Alex Karp wrote to investors that demand for its AI products “is unlike anything we have seen in the past twenty years.” It is in talks with over 300 new enterprises to deploy its AI in their systems. All in all, it’s one of those stocks loved by dumb money.

The Wall Street consensus price target is about $13, or 20% below where it currently trades. Yet the high side estimate puts it at $25, some 53% higher. Considering Palantir has surprised analysts before, it just might be “dumb” to ignore its potential now.

On the date of publication, Rich Duprey did not hold (either directly or indirectly) any positions in the securities mentioned in this article. The opinions expressed in this article are those of the writer, subject to the Publishing Guidelines.

Rich Duprey has written about stocks and investing for the past 20 years. His articles have appeared on, The Motley Fool, and Yahoo! Finance, and he has been referenced by U.S. and international publications, including MarketWatch, Financial Times, Forbes, Fast Company, USA Today, Milwaukee Journal Sentinel, Cheddar News, The Boston Globe, L’Express, and numerous other news outlets.

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