When searching for stocks to buy and hold for the long haul, there are certain things to look for.
A strong business model and excellent risk management Realty Income Corporation (NYSE:O) is one of my favorite stocks in the market, and for good reason. Basically, Realty Income acquires freestanding retail properties and leases them back to high-quality tenants. This selectivity creates an incredibly stable base of tenants that are likely to renew their leases over and over.
Realty Income pays its dividends monthly -- it actually has a trademark on the phrase "the monthly dividend company" -- and has increased its payout 81 times since going public in 1994.
Favorable demographics and a fragmented market should keep this company busy Health Care Property Investors (NYSE:HCP), known as HCP, invests in senior housing facilities, post-acute care properties, medical offices, and life-sciences properties. Not only that, but the demographic and economic trends point toward a growing need for the types of properties HCP specializes in.
Another reason HCP has an advantage is its long-established partnerships with some of the best operators in the business, including Brookdale Senior Living, HCR ManorCare, and Hospital Corporation of America (HCA).
The takeaway These are just two of many examples of great dividend stocks you can hold for the long haul, and you can take some of the reasoning discussed here and apply it to other companies. The next billion-dollar iSecret The world's biggest tech company forgot to show you something at its recent event, but a few Wall Street analysts and the Fool didn't miss a beat: There's a small company that's powering their brand-new gadgets and the coming revolution in technology. Matt brought his love of teaching and investing to the Fool in order to help people invest better, after several years as a math teacher. A strong track record of profitability, manageable debt load, and good history of increasing dividends are just a few characteristics that make a stock a "forever stock." With that in mind, here are two of my favorite forever stocks -- both of which happen to be real estate investment trusts -- and why each could be an excellent addition to your portfolio for decades to come.
The company uses long-term "net" leases, which basically means that the tenants are responsible for paying the property's expenses, such as taxes, insurance, and maintenance. Drugstores are a good example of this -- people will always need a convenient place to run out and get medications and other products quickly. These businesses also don't have much to worry about from online competitors, and dollar stores are among the fastest-growing types of retail. Even more impressively, the company has averaged 16.4% annual returns in its public life, and that time period includes the worst real-estate crash in recent history.
For starters, the company is one of the largest and most experienced in a highly fragmented industry. The population is aging rapidly, and the older age groups are expected to grow tremendously in the coming decades, creating more demand for senior housing and other healthcare facilities.
Furthermore, you should keep in mind that even though all signs point to a bright future for these three companies, there is no such thing as a risk-free stock. And we think its stock price has nearly unlimited room to run for early in-the-know investors! Matt specializes in writing about the best opportunities in bank stocks, real estate, and personal finance, but loves any investment at the right price. For that reason, it's important to diversify your portfolio, and check up on all of your stocks periodically to make sure your original reasons for buying them still apply.
Only 17% of this is owned by public REITs, and just 3% is owned by HCP -- one of the sector leaders. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. There's the dividend-backed power of PepsiCo (PEP) and the innovative growth of Tesla Motors (TSLA), not to mention the brand power of Under Armour (UA) and the strong insider ownership in Chipotle Mexican Grill (CMG). The build out of Tesla's massive Gigafactory is yet another reason for investors to own this stock for the long haul.
While this is still years away, it would ultimately lower the cost of batteries and allow Tesla to sell its Gen 3 model to the masses -- rewarding long-term shareholders in the process. Tesla's visionary chief executive, Elon Musk, has a track record of proving the critics wrong and overdelivering on expectations.
My move was was inspired by a slight pullback following the company's latest earnings report, in which impressive growth could not keep the stock from falling 10%. That's 60 times your original investment, if you held on through hard times like the Blockbuster wars, the Walmart (WMT) scare, and the Qwikster blunder. In fact, based on what we know today, 10 years from today just might be the perfect holding period for this exploding growth stock. So rather than locking up my Netflix shares and throwing away the key, I'd like to come back and reassess the situation in 2025. The DVD and Blu-ray service will be gone, either shut down entirely or spun off from the main business.
Add another eight years, and you'll simply see a much more mature, user-friendly, and content-packed service. Netflix sees no reason why international margins shouldn't eventually match domestic profitability levels, and that watermark is still inexorably rising.
Outsourced experiments such as House of Cards and Marco Polo are only the beginning; the company must become a serious media studio as well.
I'm talking tens of billions of dollars in annual earnings, and a matching long-term surge in Netflix share prices. Some of the most important are strong competitive advantages, long runways for growth, and excellent leadership. Under Armour's blood-pumping marketing campaigns resonate with athletes and their fans, helping to position the company well within the healthier lifestyle megatrend. Together, these businesses should drive further growth as Under Armour accelerates its international expansion and e-commerce steadily grows as a percentage of global retail sales.
The company operates in food and beverage, which is ideal for long-term investment because people will always have to eat and drink. The stock currently yields 2.8%, and Pepsi has raised its dividend for 43 consecutive years -- most recently a strong 7% payout increase, which is well above inflation. I'm confident this company will continue creating value for its shareholders for many years, which is why I plan on holding my shares for the next decade.
I received my shares of WhiteWave as part of its spinoff from Dean Foods (DF) in 2013 and have watched as they have risen more than two-and-a-half times since then. WhiteWave Foods is perfectly positioned to capitalize on the heightened awareness of and demand for plant-based food and beverages.
Fresh food sales, the segment comprising last year's acquisition of organic salads, fruits, and vegetables producer Earthbound Farm, hit $575 million in 2014.
The appeal and profits of the market will attract competitors -- for example, Coca-Cola (KO) is looking to offset declining soda sales. Its first foray into the market is a premium milk beverage, and there has long been talk of it partnering with or buying WhiteWave Foods.
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