With markets currently being volatile and the possibility that at least some listed companies may not survive, putting your money to work in stocks right now takes guts.
Today, however, I’m picking out 10 top-tier stocks that I’d feel comfortable buying now and holding until 2030.
Defensive demons
Although the near-term may present challenges to even the most resilient, globally-diversified companies, firms such as Unilever and Diageo should emerge relatively unscathed.
Even if the panic-buying witnessed over the last few weeks is (thankfully) unlikely to last, it’s clear that consumers will continue to prioritise spending on food and household items for the foreseeable future.
With a portfolio bursting with brands such as Persil and Dove, that should keep earnings relatively steady at Unilever.
The same goes for Diageo. Despite the enforced closure of pubs and bars, there will still be plenty of drinking going on at home. And when this is all over, the desire to socialise over a beverage or two will surely return in force.
Power provider National Grid is another stock I’d consider buying. As dull as utility stocks are, they do have a habit of holding their own during troubled times. They’re also a fairly safe choice for income hunters. Right now, the Grid yields 5.4%.
Healthcare heroes
Aside from those with great brands, there are other stocks — most notably related to healthcare, safety or hygiene — that could make great investments over the short and long term.
With its 5.4% dividend yield, GlaxoSmithKline would be my preferred pick in the pharmaceutical space. Medical devices manufacturer Smith & Nephew looks good too, especially as it only revealed market-beating revenue and profits back in February. The hip and knee implant maker might also be a good play on the longer-term ‘ageing populations’ theme.
Despite their still-frothy price tags, safety product maker Halma and pest control firm Rentokil Initial would likely make the cut too. I can’t see demand for any of their services drying up. Indeed, I think it will be the opposite!
High quality
My remaining picks are more cyclical. However, what they may lack in traditional defensiveness, they more than make up for in quality. Again, adopting a long-term perspective is vital here.
Like nearly all retailers, 164-year-old luxury brand Burberry has been forced to close stores across the world. Once the coronavirus has passed, however, I suspect its products will be as much in demand as ever, particularly in Asia. It may even become a takeover target. In the meantime, the company’s financials look robust, at least relative to sector peers.
While the extent to which the crisis will impact the UK housing market is unclear, I’d be eyeing up property portal Rightmove as well. Perpetually prohibitively expensive, the £4bn cap generates unparalleled returns on the money it invests. It’s also succeeded in protecting its massive market share for many years.
My final pick is not a single company stock at all. Tech-focused Scottish Mortgage Investment Trust gives exposure to high-growth giants such as US giants Amazon and Tesla.
Although the sector is prone to hype, the returns made by the trust over the last 10 years have been superb and far above that generated by the FTSE 100 (indicating that the trust’s managers are assured stock-pickers). As an existing holder, I’m hoping this will continue for the next 10 years.
