The holidays are fast approaching, meaning it’s time to start making a gift list and checking it twice. Figuring out what to get the grandkids can be particularly difficult for people. Beyond any generational divide that might exist, it can be hard to figure out what the grandkids already have and what they might need. Do they really need another screen to watch? Are they growing out of their clothes? However, why not buy the grandchildren stock? A long-term investment in a great company can be a smart move, one that will literally pay dividends for many years. While the grandkids might not be thrilled to receive share certificates on Christmas morning, they’ll likely appreciate the foresight of an investment as they get older and have to pay for things such as college. There can even be tax benefits to gifting stock. Here are three stocks to buy for your grandkids this holiday season.
Roblox (RBLX)
Be the cool grandparent this holiday season and buy your grandkids shares of online video-game developer Roblox (NYSE:RBLX). On the day of this writing, RBLX stock is up 17% after the company issued third-quarter results. These stocks were much stronger than Wall Street forecasts. The company, whose online video game of the same name reported 70.2 million daily active users in Q3, is up 20% from a year earlier.
Users spent more than 16 billion hours playing Roblox during the quarter, also an increase of 20% from a year ago. Owing to the increasing popularity of the company’s video game, Roblox posted a loss per share of 45 cents in its latest quarter. This was better than the loss of 51 cents that analysts had penciled in for the company. Revenue in the quarter totaled $839 million compared to $830 million that was expected. The company said that it has slowed its spending across major expense categories, and that it plans to begin providing forward guidance to analysts in 2024.
RBLX stock has now gained 48% on the year.
New York Times Co. (NYT)
Not nearly as cool as Roblox, but a great long-term investment nonetheless, is The New York Times Co. (NYSE:NYT). The publisher of The New York Times newspaper has just reached a major milestone, surpassing 10 million subscribers for the first time in its 172-year history. The continued strong subscriber growth brings the Times closer to its stated goal of 15 million paid subscriptions by the end of 2027. The company had 9.41 million digital subscribers, plus 670,000 print subscriptions, at the end of Q3 this year.
The subscription milestone was revealed along with Q3 financial results that showed the Gray Lady, as The New York Times is affectionately known, is firing on all cylinders. The company posted earnings per share (EPS) of 37 cents, which was better than the 29 cents expected by analysts. Revenue grew nearly 10% from a year earlier to $598.3 million, topping forecasts of $589.8 million. Total advertising at the Times, digital and print combined, rose 6% to $117.1 million in Q3.
Looking ahead, the Times forecasts total subscription revenue for this year will increase 8% to 11% from a year ago, as well as a single-digit percentage increase in digital ad revenue. NYT stock rose 8% after its Q3 print, bringing its year-to-date gain to 36%. Buy this stock for your grandkids. They’ll thank you when they’re older.
Datadog (DDOG)
Another tech stock to consider stuffing in your grandkids stockings this holiday season is Datadog (NASDAQ:DDOG). The company’s stock recently soared 28% in a single trading session after the software company reported better-than-expected Q3 results and raised its full-year guidance. The company, whose software is used in cloud-computing, reported EPS of 45 cents, beating expectations for 34 cents. Revenue in Q3 came in at $547.5 million, up 25% from a year earlier and beating Wall Street forecasts.
Founded in 2010 and publicly traded since 2019, Datadog builds cloud monitoring and security products that work with Amazon Web Services (NASDAQ:AMZN), and Microsoft Azure (NASDAQ:MSFT), among other cloud-computing offerings. Datadog issued a bullish full-year outlook along with its Q3 numbers, saying it now expects Q4 revenue of between $564 million and $568 million, and full-year revenue of $2.1 billion. Both figures exceeded consensus analyst forecasts.
Including the recent 28% surge, DDOG stock has gained 40% this year, with more upside likely ahead.
On the date of publication, Joel Baglole held a long position in MSFT. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.com Publishing Guidelines.
