HomeMarket NewsInvesting in Steadfast Stocks: A Varied Approach to Lifelong Returns

Investing in Steadfast Stocks: A Varied Approach to Lifelong Returns

Actionable Trade Ideas

always free

InvestorPlace โ€“ Stock Market News, Stock Advice & trading Tips

Market timing poses a challenging endeavor due to the competitive dynamics of financial markets. Therefore, embracing a more passive investment strategy often proves to be a prudent choice. Indeed, the perils of excessive trading โ€“ such as tax implications, transaction costs, and fluctuating portfolio risks โ€“ can convolute the investment landscape.

While passive investing can yield profitable results, it is essential to acknowledge the finite lifespan of some stocks. Hence, selecting equities with enduring growth potential is paramount. This morning, I meticulously sifted through several timeless stocks to unveil three top-tier assets that offer investors lasting value. Each stock met stringent criteria for fair valuation, secular growth opportunities, and diversification advantages to present a compelling investment thesis.

The Evergreen Appeal of Microsoft Corp (MSFT)

Microsoft logo close up. Microsoft (MSFT) Flagship Store Fifth Avenue, Manhattan, NYC.

Source: The Art of Pics / Shutterstock.com

Microsoft (NASDAQ:MSFT) may seem like a commonplace choice, but simplicity in investment decisions often goes unappreciated. Furthermore, the underlying secular growth narrative of the company might not be universally recognized.

In an era of heightened technological innovation catalyzed by the COVID-19 crisis, Microsoft is strategically positioned to cater to diverse market segments amidst this transformative period. Leveraging its foothold in corporate hardware realms, Microsoft can tap into a sector with a projected compound annual growth rate (CAGR) of 7.86%. Simultaneously, its expansion into consumer AI products promises revenue acceleration and operational efficiencies.

While MSFT stockโ€™s current price-to-earnings ratio stands at 37.4x, marking a premium valuation, the distinction between quality and relative value is crucial. With a robust return-on-equity ratio of 39.17% and a 5-year CAGR of 13.95%, Microsoft embodies a high-quality value stock. Moreover, its dominant market positions in emerging industries position it for sustained growth prospects.

An optimistic outlook on MSFT prevails, negating the need for market timing strategies!

UnitedHealth (UNH): A Pillar of Longevity

The UnitedHealth (UNH) headquarters in Minnetonka, Minnesota.

Source: Ken Wolter / Shutterstock.com

Nothing speaks to enduring value like long-term insurance. UnitedHealth (NYSE:UNH) stands as a stalwart provider within the long-term insurance domain, boasting a substantial market share of 31.68%. The companyโ€™s impressive market presence, coupled with adept execution, reflects in its five-year average return-on-common equity of 25.8%, exemplifying economies of scale.

UnitedHealth further benefits from its foothold in complementary businesses. The Optum division has cultivated a suite of long-term insurance and healthcare solutions to augment UnitedHealthโ€™s core operations. Noteworthy is Optumโ€™s current CAGR of 18.89%, underscoring a growth trajectory that fortifies UnitedHealthโ€™s profitability.

Despite a 5% decline in UNH stock since the onset of the year due to an ongoing antitrust investigation linked to its acquisition spree, as well as recent cybersecurity breaches, these short-term perturbations are unlikely to impede its long-term growth trajectory.

Trading at a modest price-to-earnings ratio of 20.69x, UnitedHealth presents an attractively valued proposition for investors. Furthermore, the stockโ€™s dividend yield of 1.48% accentuates its appeal as a reliable income generator.

Sibanye Stillwater (SBSW): Rejuvenating Resilience

gold mining

Source: ยฉiStock.com/TomasSereda

Sibanye Stillwater (NYSE:SBSW) weathered a challenging 2023, marked by systemic risks stemming from commodity price fluctuations and geopolitical uncertainties. Additionally, the company contended with mine inundations last year, necessitating significant infrastructure rehabilitation at its U.S. platinum operations.

Nevertheless, SBSW stock is poised for a resurgence. With its U.S. mines restored to operational capacity and adaptations to regional power supply challenges in South Africa underway, the company is primed for a new growth chapter.

Furthermore, Sibanyeโ€™s foray into renewable energy heralds a compelling narrative. Bolstered by its involvement in the lithium sector through the Keliber mine, which recently saw a 55% surge in attributable lithium resources to 702,000 tonnes, Sibanyeโ€™s strategic positioning in lithium and platinum mining aligns it with the burgeoning lithium and green hydrogen economies, signifying substantial growth potential.

SBSW stock boasts a modest price-to-book ratio of 0.57x and a forward dividend yield of 5.4%, underscoring an opportunity ripe for long-term investors to capitalize on.

As of the publication date, Steve Booyens maintained indirect long positions in MSFT, UNH, and SBSW. The views expressed in this article are solely those of the author and adhere to the InvestorPlace.com Publishing Guidelines.

Steve Booyens, the co-founder of Pearl Gray Equity and Research since 2020, has spearheaded institutional equity research and PR initiatives. With prior financial roles in London and South Africa, he holds an MSc in Investment Banking from Queen Mary โ€“ University of London. Steve is currently pursuing a Ph.D. in Finance and has cleared CFA Levels 1 & 2. His articles feature on prominent platforms like Seeking Alpha, TipRanks, Yahoo Finance, and Benzinga, offering a blend of mainstream insights and objective analysis on frequently traded securities, REITs, fixed-income instruments, CEFs, and ETFs.

More From InvestorPlace

The post 3 Timeless Stocks to Purchase for a Lifetime of Returns appeared first on InvestorPlace.

The views and opinions expressed herein belong to the author and do not necessarily mirror those of Nasdaq, Inc.

Swing Trading Ideas and Market Commentary

Need some new swing ideas? Get free weekly swing ideas and market commentary from Jonathan Bernstein here: Swing Trading.

Explore More

Weekly In-Depth Market Analysis and Actionable Trade Ideas

Get institutional-level analysis and trade ideas to take your trading to the next level, sign up for free and become apart of the community.