Investors who seek a quick path to wealth will often fail. Speculators risk reacting too emotionally if a stock drops while they watch its movements like a hawk. Conversely, investors who search for stocks to buy and hold for the very long term will have more patience.
Taking the time to research a company’s prospects will lead to better returns. Look for companies that build a strong business plan to carry through over several years. The realistic ones will explain the near-term risks, too.
Chosen across several sectors, these seven stocks to buy will make you rich by 2030 if management grows revenues at current rates:
- Applied Materials (NASDAQ:AMAT)
- Coinbase Global (NASDAQ:COIN)
- Intel (NASDAQ:INTC)
- Altria Group (NYSE:MO)
- Novartis (NYSE:NVS)
- Pfizer (NYSE:PFE)
- StoneCo (NASDAQ:STNE)
Quality, value, and growth scores vary among the selected stocks.
As shown above, all of the companies have a strong quality score. Only the growth and valuation scores vary. For example, Intel and Applied Materials are semiconductor companies with vastly different near-term prospects. Meanwhile, Altria has the lowest overall scores but the highest dividend yield. StoneCo is trading far below its 52-week high, creating a rare entry point for investors.
Stocks to Buy: Applied Materials (AMAT)
Applied Materials pays a modest quarterly dividend of 24 cents. Its leadership in the semiconductor capital equipment sector will reward shareholders.
The company has diversified into the advanced display-manufacturing segment. Also, it is in a strong position to grow in the advanced packaging market.
AMAT accelerated its growth after embracing 3D NAND production in 2014. With the chip shortage fueling unfilled sales, AMAT’s wafer fabbrication equipment (WFE) business will outgrow the semiconductor industry.
The digital transformation of the global economy is a big catalyst for AMAT stock. Large companies need to invest more to compete, and will need Applied Materials’ products to survive.
In the near term, its dynamic random access memory (DRAM) tech will perform well. The company will benefit from stronger sales in the second half of the year compared to the first.
Applied Materials’ NAND products, which are used in storage, saw weaker sales than its DRAM offerings. Still, demand next year and beyond for NAND is healthy.
Coinbase Global (COIN)
Cryptocurrency platform Coinbase will attract a considerable number of customers in the coming decade. Despite rare moments of user dissatisfaction, the site genuinely wants to teach the public about cryptocurrency investing. To address the former issue, Coinbase acquired Agara, an Indian artificial intelligence startup, to expand and automate customer service capabilities.
Coinbase has a good problem: it has too much customer growth. It cannot handle the influx and needs to strengthen support levels. As customers deposit more assets and complete more transactions, Coinbase’s revenue will grow.
On Oct. 19, Facebook (NASDAQ:FB) picked the platform to power crypto custody for Novi, its digital wallet. In this pilot study, users can acquire Pax Dollar (CCC:USDP-USD) and Novi will hold it on deposit with Coinbase Custody. If requested, Novi users may transfer USDP between each other in an instant.
Facebook is a social networking giant. Getting its support will convince customers to join Coinbase rather than its competitors.
Wall Street analysts think COIN stock trades with minimal upside ahead. Coinbase may disprove them. As revenue grows over the next decade, the stock will reward its shareholders.
Stocks to Buy: Intel (INTC)
Intel is suffering from low growth as it loses its foothold in the desktop and server markets. However, that is changing quickly. Rallying ahead of its quarterly earnings report and then slumping, as it always does, Intel is a value stock.
The giant lost its way when rivals found growth in mobile processor development. Then, Advanced Micro Devices (NASDAQ:AMD) took Intel’s desktop market through its Ryzen processor product line. AMD’s Epyc also outperforms Intel’s comparable chip line, Xeon.
But Intel’s refreshed 12th generation Alder Lake processor shows promise. Tech review sites are posting very high ratings. Intel’s architecture for Alder Lake is creative, featuring a hybrid core design that provides efficiency and solid performance. Its P-cores clock up to 5.2 gigahertz (GHz), while its E-cores run at a maximum of 3.9 GHz.
The company needs to solidify support for the new chip and developments of its graphics card. To ensure this, CEO Pat Gelsinger noted Intel will communicate better with “a developer-first approach.”
Altria Group (MO)
In the third quarter, Altria posted non-GAAP earnings per share of $1.22. Revenue fell by 2.6% year-over-year (YOY) to $5.53 billion.
Markets did not appreciate the company raising the lower end of its full-year 2021 guidance. It expects EPS in the range of $4.58 to $4.62.
The 5% to 6% EPS growth over 2020 does not show an obvious path to wealth by 2030. Yet the dividend of 90 cents per quarter is after a 5% hike. Expect Altria’s strong cash flow to allow management to raise dividends regularly.
Some investors view tobacco as an unattractive investment. But people who smoke still need to buy the company’s products. Plus, Altria has a discount segment that is growing. It is careful not to gouge price-sensitive customers, especially its premium brands.
Altria is embracing e-vapor, an alternative to tobacco that is expected to grow in popularity over the next decade. It estimated the total category volume of these products increased 17% from last year. If the future improves for this segment, Altria’s stock will rise and reward investors.
Stocks to Buy: Novartis (NVS)
In the third quarter, Novartis posted sales growing by 6% from last year to $13 billion. For 2021, expectations of net sales growth in the low- to mid-single-digit percentages will not impress investors seeking wealth. Still, its Cosentyx and Entresto drugs will add billions in revenue.
Cosentyx is a monoclonal antibody that treats psoriasis, ankylosing spondylitis and psoriatic arthritis. Peak sales could reach $7 billion for the drug. Meanwhile, Entresto is a blood pressure medication that could bring in $5 billion in revenue.
NVS stock is on sale because the company faces pressure in its near-term top-line growth. The lowered expectations hurt the share price, creating a better price for value investors.
Eventually, Novartis will post positive developments for products like its CAR-T cancer therapy. Investors do not yet now when Novartis will post such great news, but when it does, the stock will climb abruptly. Instead of timing those events, investors should look at the stock now while the market ignores it.
Pfizer (PFE)
After peaking at more than $50 this summer, Pfizer descended for no reason. Then, investors bid shares higher by 10% early in November when it announced results for its antiviral Covid pill, Paxlovid.
Besides its generous revenue split with BioNTech (NASDAQ:BNTX) for sales of the Covid vaccine (it expects at least $65 billion in 2022), the Covid pill shows promise. If taken within three days of symptom onset, Paxlovid reduced hospitalization by 89% compared to a placebo.
While lockdowns and business closures have ended in many places, the pandemic is not yet over. Even after the worst of it passes, the virus will linger in communities for at least the next few years.
If approved, Pfizer’s pill gives hospitals and doctors another weapon to fight the virus. CEO Albert Bourla said the study news “is a real game-changer in the global efforts to halt the devastation of this pandemic.”
Pfizer may realize billions in revenue within the next few months. More countries will approve Paxlovid, increasing both the addressable market and revenue for Pfizer.
Stocks to Buy: StoneCo (STNE)
After topping $95, StoneCo fell steadily in 2021. The leading provider of financial technology solutions in Brazil posted an 8.1% YOY decline in revenue.
StoneCo also posted a Q2 2021 loss. Despite a total payment volume of 60.4 billion Brazilian Reals, up 58.6% YOY, the company faces technology challenges. In the short term, its new registry system has experienced technical delays. It also suspended Take Rate, which hurt its adjusted net margin outlook for the year.
The uncertainty spooked investors, sending the stock to lows. Cautious investors may build a position from here but risk further downside ahead.
Looking beyond the quarter, StoneCo is of great importance to the merchant community in Brazil. The company will keep winning market share in the small and midsized business space. StoneCo is accustomed to the competition and will manage new products to sustain growth.
The 35% of clients that are not paying interest is a short-term headwind. Non-performing loans are also on the rise. In its Q2 earnings call, company executives stated that under the new regulatory framework, it would increase its reserves. Customers will repay their loans as cash flow recovers and from there, its income will bounce back.
On the date of publication, Chris Lau did not have (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 InvestorPlace.com Publishing Guidelines.
Chris Lau is a contributing author for InvestorPlace.com and numerous other financial sites. Chris has over 20 years of investing experience in the stock market and runs the Do-It-Yourself Value Investing Marketplace on Seeking Alpha. He shares his stock picks so readers get original insight that helps improve investment returns.
