The 10 Best Stocks to Buy for Long-Term Growth
Selecting stocks poised for long-term growth is essential to building wealth over time. While short-term performance generates headlines, companies driving innovation and expanding addressable markets position investors’ portfolios to exponentially compound over decades. The 10 Best Stocks to Buy for Long-Term Growth
This guide profiles 10 of the most attractive stocks to own for the long haul based on durability, growth prospects, competitive advantages, quality leadership, and reasonable valuations.
1. Microsoft (MSFT)
As a mature yet still fast-growing technology leader, Microsoft checks all the boxes for a long-term winner. Key advantages include:
- Diversified revenue – Office products, Azure cloud platform, Windows, gaming, and LinkedIn provide multiple growth verticals
- Sticky business offerings – Cloud and enterprise software foster loyal customers and recurring revenue
- Strong competitive advantages – Network effects and switching costs defend against disruptors
- Disciplined leadership – Satya Nadella’s strategic vision and investments in promising markets drive growth
- Reasonable valuation – Trading at 26x forward earnings leaves room for continued expansion
Cloud and business software should power double-digit revenue and earnings growth for years to come. The company generates abundant free cash flow to fund dividends and share buybacks as well. With its entrenched positioning and continued innovation, Microsoft offers a balanced growth and income profile.
2. Apple (AAPL)
Apple sits at the intersection of technology and consumer discretionary – two attractive sectors for the future. Key strengths include:
- Loyal customer base – The Apple ecosystem breeds loyalty and repeat customers across product families
- Powerful brand – Consistently ranked as an admired and valuable global brand
- Innovation track record – A pipeline of revolutionary hardware products and software services
- Financial strength – $63 billion in cash on hand and ample free cash flow fuels investments and dividends
New iPhone models and expanded service offerings should drive solid growth on top of an already massive revenue base. And investors can ride Apple’s disruptive innovations into the future. Tech juggernauts retaining their edge are rare. Apple checks all the boxes.
3. Amazon (AMZN)
Amazon pioneered e-commerce but also wields tremendous power in cloud computing and other segments. Here’s what makes Amazon a long-term winner:
- Leadership in diverse markets – #1 in ecommerce, cloud computing, streaming video & music
- High switching costs – Once customers go all-in on the Amazon ecosystem, they rarely leave
- Culture of innovation – Relentless focus on finding the next disruptive businesses
- Logistics network – Leverages scale for efficiency and speed difficult for competitors to replicate
New industries like digital advertising and brick-and-mortar grocery promise continued growth on top of Amazon’s core segments. And the company’s expanding profits provide resources to aggressively invest in long-term positioning. For these reasons, Amazon stocks remains a smart buy.
4. Alphabet (GOOGL)
Alphabet dominates online advertising through its Google search engine. But growth opportunities abound in other segments like YouTube, cloud computing, and autonomous vehicles:
- Search platform monopoly – Owns 85% global search market share
- YouTube dominance – The world’s #1 online video platform continues monetizing its billion+ users
- Financial strength – $159 billion cash hoard provides dry powder for investments
- Bets on disruptive technologies – Self-driving cars, AI, quantum computing and more sit in Alphabet’s pipeline
- Diversified revenue – Google search, YouTube, Google Cloud, and hardware sales provide multiple growth channels
Stellar top line growth has been coupled with expanding profitability, giving Alphabet resources to aggressively invest in high-potential emerging opportunities. As a tech industry leader, it remains well-positioned for where the world is headed.
5. Visa (V)
Processing digital payments is a structurally attractive sector benefiting from the secular shift away from cash. As the dominant leader, Visa is set to ride this tailwind for many years. Advantages include:
- Strong competitive position – Enjoys over 50% market share in credit card network transactions
- Duopoly partnered with Mastercard – The two maintain a stronghold on the payments ecosystem, limiting disruption
- Asset-light model – Requires minimal investment in infrastructure and assets compared to banks
- Operating leverage – Ability to grow revenue without significantly expanding expenses leads to earnings growth outpacing revenue growth
On top of consistent double-digit EPS gains, Visa has room to expand into adjacent opportunities like business-to-business payments. Continuous innovation around payments keeps Visa positioned for where the future is headed.
6. UnitedHealth Group (UNH)
As the largest private health insurance provider in the U.S., UnitedHealth Group sits at the intersection of two massively important sectors – insurance and healthcare. Tailwinds include:
- Increasingly diversified revenue – Health insurance plans, IT services, pharmacy benefit management create multiple verticals to drive growth
- Resilient industry – Healthcare reform attempts have mostly failed to disrupt private health insurers over the last decade
- Aging population base – Medicare plans and other products serving seniors represent a growing market
- Innovative technology – Leverages AI and data analytics to improve efficiency and healthcare outcomes
UnitedHealth Group has delivered 16% annualized total returns over the last decade thanks to steady growth and shareholder returns. Its entrenched position in a critical space should lead to many more years of success.
7. BlackRock (BLK)
BlackRock is far more than the world’s largest asset manager. It’s also pivoting into faster growth opportunities:
- Dominant asset manager – Controls over $10 trillion in assets under management across stocks, bonds, funds, and alternative assets
- Move into alternatives – Acquiring private equity, real estate, and infrastructure assets expands addressable market
- Technology provider – Aladdin software platform aids institutional investors in accessing liquidity, risk analysis, and portfolio construction
- Leader in ESG – Positioned to capitalize on the sustainability investing megatrend
BlackRock’s traditional asset management segment provides rock solid recurring revenue. Meanwhile, pivoting into adjacent opportunities expands growth prospects beyond just chasing fund inflows. All at a reasonable valuation.
8. Roche Holding (RHHBY)
Swiss drug maker Roche develops treatments for oncology, immunology, infectious diseases and other therapeutic areas. Here’s why it represents a smart long-term buy:
- Diverse drug portfolio – Multiple blockbuster drugs across various high-growth treatment categories
- R&D pipeline – 80+ ongoing clinical trials and breakthrough designations signals promising new drugs
- Cost discipline – Roche spends far less on sales and general costs than peers while re-investing savings in R&D
- Global sales – Sales and capacity outside the U.S. reduce regulatory risks
An aging global population supports demand tailwinds for innovative medicine. And Roche’s heavy investments in next-gen personalized healthcare provide an edge. For investors, Roche offers a balanced growth and income profile.
9. Intuitive Surgical (ISRG)
Developing cutting-edge surgical robotics systems positions Intuitive Surgical for long-term growth as this technology expands. Advantages include:
- Leader in growing robotic surgery industry – Dominates with 70% global market share
- Recurring revenue from instrument, accessory and service sales – Supplements system placements for steady revenue
- Healthcare cost savings – Reduced complications and hospital stays from robotic surgery lowers overall costs
- Emerging market growth – Penetration outside the U.S. still in early stages
With an innovative product offering life changing benefits, Intuitive can capitalize on favorable demographic and healthcare trends for years to come. The company is already profitable with room to grow earnings substantially over the next decade.
10. NVIDIA (NVDA)
NVIDIA’s leadership in graphics processing units (GPUs) makes it a pivotal player in artificial intelligence, cloud computing, autonomous vehicles and the metaverse.
- GPU innovation – Continually pushing computing speed and power efficiency
- AI leverage – GPUs trained AI algorithms fuel growth in cloud services, self-driving cars, robotics and more
- Gaming dominance – Enjoys over 80% discrete GPU market share among PC gamers
- Metaverse potential – 3D graphics and virtual world-building ability positions NVIDIA for the next computing frontier
The company sits at the epicenter of AI, cloud, crypto, gaming, and the enterprise metaverse – some of technology’s most exciting growth frontiers. While its valuation appears stretched, long-term profit growth potential makes NVIDIA a buy-and-hold for the future.
Finding great growth stocks trading at sensible valuations takes research. But investors with long time horizons can ride winners like these for years if not decades.
Patience allows compounding to work its magic. But regularly review positions to ensure the original thesis remains intact.
Maintain diversification beyond any individual stocks to manage overall portfolio risk. And use market volatility to selectively add to high conviction names for the future.
With a balanced, long-term mindset great companies can retire you early. But investing success requiresFILTERING OUT THE NOISE IN THE MARKET’S SHORT-TERM GYRATIONS.