Given the uncertainty in financial markets, long-term stocks for new investors are probably the way to go now. These assets promise healthy long-term growth while trading at attractive prices based on their future prospects. Furthermore, amidst a market infatuated by AI, these often-overlooked stocks present a golden opportunity for portfolio diversification.
Moreover, with the S&P 500 soaring, new investors have plenty of opportunity to tap into multiple investment areas, promising growth and prosperity. Interestingly, the true appeal of these stocks lies in their innovative strategies to ensure a bright and lucrative future for their businesses and shareholders.
Pfizer (PFE)
Pfizer (NYSE:PFE), a behemoth in the pharma space, is a prime candidate for any long-term investment portfolio. Its robust pipeline highlights its resilience, indicating a promising future following its stellar performance during the Covid era. In an impressive feat, the company secured nine new molecular entity approvals in 2023 alone, highlighting its forward-thinking approach.
Moreover, Pfizer’s strategic acquisition of Seagen catapults its oncology research capabilities, doubling its resources overnight. This move underlines Pfizer’s dedication to fortifying its oncology portfolio and building on its potential to pioneer groundbreaking cancer therapies.
Financially, Pfizer presents an attractive proposition with its stock trading at a forward non-GAAP price-to-earnings (P/E) ratio of 12.2%, significantly lower than the sector median of 19.24%. Coupled with a forward yield of 6.2%, notably surpassing the healthcare sector’s average yield of 1.6%, and a history of 14 consecutive years of payouts, Pfizer stands out as a compelling choice for investors.
General Motors (GM)
General Motors (NYSE:GM) is revving up its engines for a resurgence, showcasing remarkable resilience in the face of adversity. Despite facing a $1 billion setback from a United Auto Workers strike, GM stock has made a strong comeback, delivering a stellar 12% stock price bump year-to-date (YTD).
Moreover, GM has pledged an investment of up to $35 billion through 2025 in transitioning to an all-electric future. This ambitious plan includes transforming its Spring Hill, Tennessee assembly plant and Factory ZERO into electric vehicle (EV) production hubs. EVs are the future for GM, with the company selling a whopping 75,883 EVs last year, representing roughly 3% of total sales and 93% more compared to 2022.
General Motors ‘ stock appears notably undervalued with a discounted forward non-GAAP P/E ratio of 4.5% compared to the sector median of 16%. Moreover, despite a historically modest dividend track record, the company has demonstrated an impressive 8.9% annualized earnings per share (EPS) growth over the last five years. Hence, its strong track record and plans to accelerate EV development position GM stock for long-term gains.
AT&T (T)
AT&T (NYSE:T) is a true beacon for investors eyeing future growth amidst a seemingly stagnant phase. The telecom titan’s full-year free cash flows stood at $16.8 billion, comfortably ahead of the previously increased guidance and up $2.6 billion from the prior-year period. With an enticing $1.1 annual dividend, AT&T emerges as one of the top picks in the current market landscape.
Moreover, its stock trades at a striking forward non-GAAP P/E ratio of just 7.5%, significantly lower than the sector’s median of 15.3%. Also, it yields a compelling 6.6% despite the prior adjustment in its payout strategy.
Analysts’ forecasts further brighten AT&T’s prospects, with a TipRanks consensus indicating a 20% upside potential and a target price of $20.3 per share. The upside, strong free cash flow growth, and robust dividend yield position T stock as a fascinating bet in its burgeoning niche.
On the date of publication, Muslim Farooque 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.
