- Procter & Gamble (PG): Consumer staples company whose stock is largely recession-proof.
- American Express (AXP): Strong brand loyalty combined with diversified business make this a consistent winner.
- Tesla (TSLA): Dominant global position in the electric vehicle market and huge share price appreciation.
Deutsche Bank (NYSE:DB) just become the first major financial institution to forecast a recession for the U.S. If true, a recession would be the latest obstacle thrown up for investors to manage in an increasingly difficult market.
Already grappling with war in Europe, record inflation, sky high energy prices, global supply chain shortages and the tail end of global pandemic, investors could soon find that they are trying to navigate negative economic growth. This will almost certainly add to the market volatility experienced over the past six months and make it even harder to earn money on stocks.
So, what’s an investor to do? The best thing anyone can do is to invest long-term in reliable, large-cap stocks that have a consistent track record of delivering gains to shareholders. Here are three large-cap stocks to buy and hold for the long-haul, through good times and bad.
| PG | Procter & Gamble | $158.31 |
| AXP | American Express | $179.86 |
| TSLA | Tesla | $1,041.05 |
Large-Cap Stocks to Buy for the Long-Haul: Procter & Gamble (PG)
Are we headed for a recession? If we are, it’s a good idea to buy stocks of companies that specialize in consumer staples. When asked why he bought Fruit of the Loom, Warren Buffett famously said that people will always need underwear. They’ll also need razor blades, tampons and laundry detergent, all of which are made by Cincinnati, Ohio-based Procter & Gamble (NYSE:PG).
A going concern since 1837, P&G today owns legendary household brands ranging from Tide detergent and Pampers diapers to Gillette razor blades and Crest toothpaste, to name only a few. For long-term investors, Procter & Gamble remains a great stock to add to a portfolio.
Over the last six months, PG stock has gained nearly 13% to now trade at $158.31 per share. That’s a huge improvement over the 2% gain for the benchmark S&P 500 index over the same period. Over the last five years, Procter & Gamble’s stock has increased 78%. Today, the company has a market capitalization of $381 billion and a price-to-earnings ratio of 28, making it a fairly valued large-cap stock.
Procter & Gamble also has a dividend that is currently yielding 2.24% and a $10 billion stock buyback program, both of which benefit shareholders. This is a company and stock that’s built for the long-term.
American Express (AXP)
Credit card giant American Express (NYSE:AXP) is another stock that has consistently delivered for investors. Over the last year, the stock has gained 23%. Over the last five years, AXP stock has increased 132%, and that includes the Covid-19 pandemic in which travel (particularly business travel) was literally grounded. Yet despite any hurdles that arise, American Express finds away to continue delivering for customers and shareholders. And the company continues to diversify, moving into new areas that even include the “metaverse.”
American Express CEO Stephen Squeri recently issued a bullish outlook for travel, telling CNBC that the company is now at 80% overall travel bookings and that consumer travel is now fully recovered from the pandemic and above pre-Covid-19 levels. He added that travel bookings have marched higher since the holiday travel period last December.
American Express should also benefit going forward from higher interest rates with the U.S. Federal Reserve now raising its benchmark target, and also the continued easing of Covid-19 restrictions. American Express now has a market capitalization of $136 billion and a P/E ratio of 18, making it an attractive large-cap stock.
Tesla (TSLA)
It’s not cheap, but electric vehicle manufacturer Tesla (NASDAQ:TSLA) is a large-cap stock that continues to fire on all cylinders. The company just opened a new plant outside Berlin, Germany, and is in the process of expanding its existing manufacturing facility in Shanghai, China. The growth comes as the Austin, Texas-based company reported that it delivered a record 310,048 electric vehicles in this year’s first quarter, up 68% from the same period of 2021.
On April 7, Tesla will host a grand opening and “cyber rodeo” event at the site of yet another new vehicle assembly plant it’s building in Austin, Texas, where the company moved its global headquarters late last year. The record deliveries and huge growth have helped to keep TSLA stock charged. In the last month, the company’s share price has rebounded 23% after slumping along with the entire tech sector to start the year.
At the current share price of $1,041.05, TSLA stock has gained 49% over the past year and is up 1,600% over the past five years. The company’s market capitalization now tops $1 trillion. While its P/E ratio is 211, the high valuation is justified by the massive growth and profits the company is delivering, say bullish analysts.
On the date of publication, Joel Baglole 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.
