Three Promising Stocks to Consider for Long-Term Investments
Contrary to common belief, achieving significant investment gains does not require constant portfolio monitoring or taking excessive risks. In fact, reducing risk while decreasing trading activity can enhance overall performance. The key is to identify the right buy-and-hold stocks and maintain them long enough for time to work in your favor.
Here’s a look at three stocks that offer above-average wealth-building potential, making them easy to own without the need for frequent updates on performance or market chatter.
1. Shopify
Currently valued at over 60 times this year’s projected earnings per share of $1.47, even after a 26% pullback since February, Shopify (NASDAQ: SHOP) might seem daunting to potential investors. However, this could be a rare opportunity for those looking to enter the market.
Shopify enables businesses to create and manage their e-commerce platforms. Originally positioned as a competitor to Amazon, it offers tools like inventory management, payment processing, and marketing solutions.
In the previous year, Shopify’s technology facilitated $293 billion in sales, generating $8.9 billion in revenue—both figures reflecting annual growth of 24% and 26%, respectively, demonstrating a solid growth trend.
Despite the inevitability of market fluctuations, Shopify’s growth prospects appear strong. Precedence Research forecasts the global e-commerce market will grow nearly 15% annually through 2034. With online sales constituting roughly 16% of U.S. retail spending, the outlook remains optimistic.
Furthermore, many sellers are recognizing the advantages of owning the shopping experience, rather than relying on middlemen like Amazon. Analysts support this viewpoint; while Shopify’s stock has recently dipped, the consensus price target remains at $119.32, indicating over 25% upside potential from its current price.
Image source: Getty Images.
2. C3.ai
While Palantir Technologies dominates the artificial intelligence (AI) decision-making software space, C3.ai (NYSE: AI) presents an intriguing alternative for investors. With a market cap of around $3 billion and no current profits, C3.ai may initially seem less attractive.
Both AI companies serve similar purposes by transforming vast amounts of data into actionable insights, but their markets differ. Palantir primarily focuses on government entities, while C3.ai targets businesses across various sectors, including pharmaceuticals and energy, with clients like Shell and Consolidated Edison.
Demand for business decision-making software is expected to grow by 16% annually through 2034, suggesting C3.ai could benefit significantly as companies increasingly invest in AI tools. A nearly 50% decline in C3.ai’s stock since late last year presents a favorable buying opportunity for patient investors.
3. Alibaba
Finally, Alibaba (NYSE: BABA) rounds out this list as a potential wealth-building asset. Despite recent performance challenges linked to recent regulatory measures in China, there are signs of improvement.
Efforts to restructure the company’s operations led to an increase in efficiency, supported by a management overhaul and renewed motivation from founder Jack Ma. Recent growth figures show a 5% increase in domestic e-commerce platforms Tmall and Taobao for the December fiscal quarter, while international e-commerce revenue surged by 32% year over year.
Even with new U.S. import tariffs, most international business is conducted outside of the U.S., minimizing potential disruptions. Notably, Alibaba’s cloud intelligence segment also reported 13% growth as it ventures into AI services, further solidifying its revenue-generating capabilities.
# Alibaba’s AI Innovations: A New Era for Market Leadership
Alibaba recently introduced its Qwen 2.5 AI model, generating significant interest in the artificial intelligence sector. Notably, this announcement followed closely after the debut of DeepSeek-V3, a platform that has been generating buzz. Qwen is reported to match or exceed the capabilities of established AI models like OpenAI’s ChatGPT and Google’s Gemini, all while potentially offering a lower cost. If the latest version of Qwen proves truly superior, it could position Alibaba as a frontrunner in one of the fastest-growing sectors globally.
In fact, market forecasting firm SkyQuest anticipates that the artificial intelligence platform industry will grow at an impressive annual pace of nearly 24% through 2032.
Investment Considerations for Shopify
Before deciding to invest $1,000 in Shopify, it’s important to weigh expert insights:
The Motley Fool Stock Advisor analyst team recently highlighted what they consider to be the 10 best stocks for investors today, and Shopify did not make this list. The selected stocks are deemed likely to yield significant returns in the upcoming years.
For example, consider when Netflix was included in this list on December 17, 2004. If you had invested $1,000 at that time, it would now be worth approximately $623,685! Similarly, when Nvidia was recommended on April 15, 2005, a $1,000 investment would have grown to about $701,781!
It’s also worth noting that the Stock Advisor has achieved an average return of 906%, significantly outperforming the 164% return of the S&P 500. To explore the current top 10 stocks, consider joining the Stock Advisor.
The views and opinions expressed herein are solely those of the author and do not necessarily reflect those of Nasdaq, Inc.
