If you believe in long-term investing like me, you will look for stocks that have a strong performance history and an ability to thrive in uncertain situations. Many of us want to leave a legacy for our grandkids and investing in stocks for them is a good way to get started. They will thank you when the investment has multiplied over the years, and they have enough money to buy a home or pay for college. When it comes to legacy investing, the sooner you do it, the higher your gains.
With that in mind, let’s take a look at the seven stock picks for your grandkids.
Microsoft (MSFT)
One stock that can make your grandkids millionaires is Microsoft (NASDAQ:MSFT). The top tech giant has grown over 260% in the past five years, and this is one stock that continues rewarding shareholders through dividends. It enjoys a dividend yield of 0.80% and has a quarterly payout of $0.75 for the stock trading at $375 today. Microsoft is one of the best stock picks for your grandkids.
The company has invested heavily into artificial intelligence (AI) and this investment is going to pay off in the next five years. The company has a range of products and services that have become integral in our lives. Microsoft has seen a steady rise in net income in 2023, and I believe this trend will continue in the coming year.
Its acquisition of Activision Blizzard will also benefit the company over the next few years. It has the liquidity to invest in research and development and has the leadership that can take the company to new heights.
Nvidia (NVDA)
A hot tech stock in 2023, Nvidia (NASDAQ:NVDA) still has a long way to go. It is the biggest beneficiary of the AI hype and is raking in millions. The company has beat expectations and reported strong revenue numbers quarter after quarter. It is one of the best stocks to buy today and it will keep growing in the years to come.
Once known for the highest standard graphic processing units, Nvidia manufactures AI chips that help other applications run. Companies are willing to wait for weeks to get their hands on these chips. Nvidia is the largest player in the AI sector and it shows no signs of slowing down.
The stock is exchanging hands for $495, up 245% year to date. While it may not be possible for the company to have another rally like this one, it will steadily keep growing in the years to come. The company is expecting to sell 500,000 H100 chips in the final quarter of the year, and I am confident it will beat expectations again.
Palantir Technologies (PLTR)
If you are investing for your grandkids, it makes sense to invest in companies that have a strong history and will continue to grow over the coming decades. Palantir Technologies (NYSE:PLTR) is one such company. A favorite of the government, it was once criticized for only focusing on government clients, but it has shown a strong growth in the commercial clients now.
The Big Data firm is investing in AI to enhance the workflow for customers and it can analyse large data in a few days. Exchanging hands for $17, PLTR stock is undervalued and it has the potential to double your money.
In the third quarter, it saw the commercial customer count hit 181, up 37%, and the revenue was up 23% year over year. The company is finally profitable now and I believe this is the beginning of the upside momentum. PLTR stock is the one to buy and hold for the years to come.
Apple (APPL)
A favorite of Gen Z, Apple (NASDAQ:AAPL) is one company that thrives on customer loyalty. It carries a brand value due to which people are no longer willing to switch from Apple. The company has a global presence and offers a range of products and services that cater to various needs. Apple has grown tremendously over the past decade and I believe it will continue to thrive.
It has a market cap of over $3 trillion, and the stock has been hitting new milestones lately. It is exchanging hands for $193 and is up 54% year to date. The company did see a drop in iPhone sales in the second quarter, but it picked up in the third quarter, and this is also when it announced the iPhone 15 with other product launches.
I believe this quarter could be excellent for the company. There is so much more to Apple than just the iPhone and the company is known for innovation. It has been navigating through high inflation and low consumer spending in the past year but I believe 2024 will be much better.
Amazon (AMZN)
The one e-commerce stock that should be held for years is Amazon (NASDAQ:AMZN). This global giant is an innovation king, and it is not going anywhere. The company offers every product you can imagine and it will soon start selling cars online. Amazon has come a long way from its modest beginning as a bookseller and it holds a massive market share today.
The company is investing in AI and has integrated it into several services including logistics. It thrived during the pandemic and then dropped in 2022, but the stock has recovered since then and is inching closer to the 52-week high of $155. Yes, the stock isn’t cheap, but it would be a mistake to wait for it to drop.
Amazon will report exceptional results due to the Black Friday sales and the holiday season. The legal battles it is going through today might not even matter in two years. It is growing its advertising revenue and its Amazon Web Services segment at an impressive rate, making it one of the best stock picks for your grandkids.
Disney (DIS)
Disney (NYSE:DIS) was around when you were growing up and it will be around when your grandkids grow up. The company might have seen a slowdown and suffered due to the pandemic but it still has a long way to go. The stock hasn’t seen much of an upside this year and is trading for $90 today.
Its theme parks are picking up and the holiday season could see higher traffic. Additionally, the streaming business has seen significant growth in the core subscriber base, and is over 112 million right now. This is a subscription economy and Disney’s core subscriber numbers prove that it is headed in the right direction.
Despite facing several challenges in the past, Disney has been standing strong and is now gaining ground. It also enjoys a dividend yield of 0.66% which will continue to generate passive income in the years to come. Disney is an icon and one that should be a part of your portfolio at the earliest.
Johnson & Johnson (JNJ)
A global giant, Johnson & Johnson (NYSE:JNJ) needs no introduction. The company has made a wise move by separating the consumer wellness segment and will now only focus on the innovative medicine and MedTech segment.
One of the most reliable stocks and the biggest players in the industry, JNJ stock has lost 12% year to date and is exchanging hands for $156. It is a dividend aristocrat with a yield of 3.04%. The company has enough liquidity to invest in research while also rewarding shareholders. Its diversified portfolio consists of some of the stalwarts that continue to generate revenue year after year.
Johnson & Johnson has another 25 drugs under trial which could lead to higher sales in the next few years. It is a stable company with a strong global presence, and while you may not see an immediate upside in the stock, it is worth holding on to.
On the date of publication, Vandita Jadeja did not hold (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.
