Finding stocks to buy-and-hold for the long term is not easy today. With technology having a disruptive impact across nearly every industry, many companies are facing uncertain futures.
However, there are certain companies that are so dominant they look set for strong long-term growth no matter what the future holds. Here’s a look at three such companies. I own all three stocks myself, and plan to hold them until at least 2030.
Amazon
Let’s start with Amazon (NASDAQ: AMZN), which is listed in the US. It’s the world’s largest online shopping business and also a major player in cloud computing.
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One reason I see Amazon as a great stock for me to buy-and-hold for the long term is that the company now has over 200m users signed up to its Prime service. This is a huge competitive advantage. Prime members tend to buy goods repeatedly on the platform. Meanwhile, they also provide the organisation with reams of shopping data that it can use to enhance its artificial intelligence (AI) capabilities. So, it appears well placed to benefit from the continued growth of the e-commerce industry.
Additionally, Amazon has a market share of over 40% in the cloud computing industry. With this industry projected to grow by nearly 20% per year over the next decade, the company will have strong tailwinds behind it in the years ahead.
Now, it does have a high valuation. This adds some risk. I’m comfortable with the valuation though, all things considered. I’m convinced that by 2030, today’s share price will look like a bargain.
Microsoft
Another stock I see as a great long-term buy-and-hold for me is technology powerhouse Microsoft (NASDAQ: MSFT).
What I like is that the company has ‘sticky’ revenues. All over the world, businesses use its Office product (now subscription-based meaning Microsoft can continually raise prices). They’re unlikely to stop using it.
I also like the fact that it’s a major player in video-gaming (it owns Xbox). This industry looks set for solid growth in the years ahead, and Microsoft’s dominance here could help it become a key player in the metaverse.
Like Amazon, it does have a lofty valuation. This means that if growth slows, the stock could underperform. I’m feel that by 2030 though, the share price will be much higher.
Alphabet
Finally, I also see Alphabet (NASDAQ: GOOG) as an excellent stock for me to hold for the long run. It’s the owner of Google and YouTube.
The reason I’m bullish here is that Alphabet is dominant in some of the industries in which it operates. In the internet search space, for example, it has a 90%+ market share globally. This is a competitive advantage. Thanks to its dominance here, it’s able to generate huge digital advertising revenues.
Alphabet is also one of the biggest players in the artificial intelligence space through its DeepMind division. AI is likely to have a big impact on the world over the next decade, so the company should benefit.
The biggest risk here, in my view, is regulatory intervention. If regulators were to make moves designed to reduce the company’s dominance, its profits margins could be impacted.
However, with the stock trading at just 22 times this year’s forecast earnings, I think a lot of risk is priced in here already.
