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However, here’s an interesting thing: even though the stock market generally does well, individual investors often don’t earn as much money as they could. They only manage to get about one-third of the total returns that the stock market offers. Why is that?
Well, it turns out that many investors make some common mistakes. They often buy and sell stocks too frequently, changing their minds too often, and sometimes they even make decisions based on their emotions rather than facts and logic. These actions can actually hurt their investment returns.
But there’s a better approach! Instead of constantly jumping in and out of stocks, it might be a good idea for investors to choose some of the market’s best long-term stocks and hold onto them for a long time. By staying invested in these high-quality stocks, they have a higher chance of earning solid returns over the long run.
So, if you’re looking to invest, consider buying and holding onto some of these great long-term stocks. They have a track record of performing well and could potentially help you grow your wealth over time.
McDonald’s (MCD)
If you’re looking for a reliable and easy investment, McDonald’s is a great option. It’s like a never-ending investment that you can just set and forget. Over the long term, the value of McDonald’s stock tends to go up consistently. So, if you’re someone who wants to invest in companies that have a strong competitive advantage and are difficult to compete against, you should definitely consider buying McDonald’s stock.
McDonald’s is currently the third largest quick-service restaurant chain in the world based on the amount of money it makes. It brings in nearly $25 billion in sales every year. That’s a whole lot of burgers and fries being sold!
In the past year alone, the value of McDonald’s stock has gone up by 20%. And if you look at the past five years, the company’s share price has increased by a whopping 75%. That’s really impressive growth! On top of that, if you own McDonald’s stock, you also get paid a dividend every quarter. Right now, that dividend gives you a 2.11% return on your investment, which is like getting an extra $1.52 for every share you own.
Recently, McDonald’s announced its earnings, and they were even better than what Wall Street experts had predicted. This means the company made more money and had higher profits than expected. In fact, their earnings per share were $2.63, while analysts were only expecting $2.33. And their revenue was $5.90 billion, surpassing the forecast of $5.59 billion. These impressive numbers show that McDonald’s is a solid and reliable company.
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Alibaba (BABA)
Investing in China comes with some risks, but there’s also a great opportunity for significant gains. One major Chinese tech company with enormous growth prospects is Alibaba (NYSE: BABA), often called the “Amazon of China.” Alibaba is not just an e-commerce giant; it also has a presence in cloud computing, online payments, and artificial intelligence.
In the past few years, BABA stock faced challenges as Chinese authorities cracked down on publicly traded companies, especially in the tech sector. However, it seems like the worst is now behind them, and the situation is improving.
Interestingly, some well-known investors are starting to invest in Chinese stocks. One notable example is Michael Burry, who gained fame from his successful bet against the housing market in “The Big Short.” In May, it was revealed that Burry had doubled his holdings in BABA stock. In fact, Alibaba, along with another Chinese tech firm called JD.com (NASDAQ: JD), now represents the largest portion of Burry’s investment portfolio, accounting for 20% of it. This indicates that Burry and other investors are confident in the long-term growth potential of major Chinese companies like Alibaba.
Broadcom (AVGO)
When we talk about microchip and semiconductor companies, names like Nvidia (NASDAQ: NVDA) and Advanced Micro Devices (NASDAQ: AMD) often dominate the conversation. However, one major player that often gets overlooked is Broadcom (NASDAQ: AVGO). It is very sad, because Broadcom has consistently outperformed many of its competitors over the years.
In the past year alone, AVGO stock has gone up by an impressive 65%. And if we look at the past five years, the stock has risen by over 200%. That’s remarkable growth!
Broadcom’s chips play a crucial role in powering various technologies. They are used in wireless networks, data centers, and even artificial intelligence (A.I.) applications. This means that the company’s products are at the heart of many cutting-edge technologies.
What’s more, Broadcom recently made headlines with the news that antitrust regulators in Europe are likely to approve its $61 billion acquisition of a cloud computing firm called VMware (NYSE: VMW). This acquisition will further diversify Broadcom’s technology offerings and expand its potential applications. It’s a smart and strategic move by the company.
In addition to its strong performance and strategic moves, Broadcom also stands out among its peers by paying a decent dividend. Currently, the dividend yield is around 2.14%, which is quite rare among chipmakers and tech companies. This means that investors who own AVGO stock not only benefit from its growth potential but also receive regular dividend payments.
Apple (AAPL)
We’re not sure yet if consumers will love Apple’s new augmented reality headset, which costs $3,500. But that’s okay because Apple has many other products that keep their sales going strong. They have the iPhone, Macbook, and Apple Watch, and they’ve even entered the financial and streaming industries. With all these products, it’s no wonder that Apple’s stock price recently reached an all-time high of over $183 (when adjusted for stock splits).
Apple is a really big company, worth almost $3 trillion. And it’s expected that the value of their shares will keep going up for many years to come. One of the reasons for Apple’s success is that people really love their brand and stay loyal to it. Plus, Apple is always coming out with new and improved versions of their products. Every year, without fail, they release updated versions of what they sell. That’s pretty cool!
Another thing that’s great for investors who own Apple stock is that the company actually buys back a lot of its own stock. In fact, they buy back more of their own stock than any other company that’s traded on the stock market. This is good news for shareholders because it can help drive up the value of their shares.
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Starbucks (SBUX)
Starbucks (NASDAQ: SBUX) is all about one thing: selling coffee. And they do it really well! In fact, they have become the biggest restaurant chain in the world, making over $30 billion in sales every year. They have more than 35,000 stores all around the world and a huge team of 400,000 employees. It’s pretty amazing to think that Starbucks actually makes more money than McDonald’s (NYSE: MCD) when you consider that their menu is much smaller and doesn’t change as often as other fast food places.
One of the reasons for Starbucks’ success is that people just love coffee. Surveys have shown that almost half of Americans drink three to five cups of coffee every day! And out of all the coffee brands out there, 39% of Americans say that Starbucks is their favorite. This strong coffee addiction in the country helps explain why Starbucks makes such good profits.
But it’s not just about America. Starbucks is also a big deal globally. They have a major presence in China, which has the largest population in the world with 1.4 billion people. This means that Starbucks has a lot of potential customers there. With their global reach, Starbucks is set to keep selling coffee and making money for many years to come.
Investors who own SBUX stock have seen some really nice gains too. In the past year alone, the stock has gone up by 35%. And if you look at the past five years, it has risen by an impressive 76%. That’s a pretty good return on investment!
Ralph Lauren (RL)
Ralph Lauren (NYSE: RL), a fashion company, has done better than many other retailers during the ups and downs of the past 18 months. In the past year alone, the value of RL stock has increased by 27%. And since 2017, it has gone up by an impressive 75%. That’s really good growth!
One of the reasons for Ralph Lauren’s success is that they target a wealthier group of customers. They offer polo shirts and other preppy clothing that appeals to people with more money. This has helped them weather economic downturns because affluent individuals tend to be more cautious with their spending and cut back on expenses only when absolutely necessary.
Another advantage that Ralph Lauren has is that it’s a truly international company. They sell their products in every part of the world. In their most recent earnings report, Ralph Lauren announced that their sales in China increased by 4% during the quarter, which helped offset any weaknesses they experienced in the United States. So, they have a global presence that helps them stay strong.
But Ralph Lauren is more than just a clothing brand. They have expanded into other areas like eyewear, bedding, fragrances, and cosmetics. Their goal is to become a full luxury company that offers a wide range of high-end products.
Toyota (TM)
Tesla (NASDAQ: TSLA) is often considered one of the best electric vehicle stocks out there. But it looks like Toyota Motor (NYSE: TM) is gearing up to give Tesla a run for its money. You see, Toyota is actually the largest vehicle manufacturer in the world. In 2022, while Tesla produced 1.3 million vehicles, Toyota produced a whopping 10.5 million! And now, Toyota has announced that it’s going all-in on electric vehicles.
Toyota plans to focus its resources on developing a wide range of electric vehicles and the batteries needed to power them. They have set a target to sell 3.5 million battery-powered vehicles every year by 2030 through a new electric vehicle business unit called “BEV Factory.” That’s a lot of electric vehicles! And that’s not all. Toyota is also aiming to achieve an impressive driving range of 1,000 kilometers on a single battery charge for all their future electric vehicles. That’s almost double the range of Tesla’s popular Model 3 sedan, which can go about 570 kilometers on a single charge. Toyota is even working on developing solid-state batteries for their electric vehicles, which could be a game-changer in the industry.
Toyota’s new CEO, Koji Sato, has made electric vehicle production his top priority. This shows how serious Toyota is about becoming a major player in the electric vehicle market. Other automakers should take notice! It’s no wonder that TM stock has already gone up by 20% this year.
What’s even more interesting is that Toyota’s stock has a low price-earnings ratio of 12. This means that the stock is relatively affordable compared to its earnings. And if you’re an investor, there’s more good news. Toyota also pays a rich dividend yield of 2.58%. So, not only could you potentially benefit from the stock’s growth, but you could also receive regular dividend payments.
