Long-term stocks offer investors the opportunity to benefit from the growth and profitability of well-established companies over an extended period.
Historically, stocks have outperformed other investment options such as bonds or savings accounts, making them an attractive choice for long-term wealth creation. While short-term price fluctuations are inevitable, a well-diversified portfolio of high-quality stocks can yield substantial returns over decades.
By selecting financially sound companies with a proven track record of success, investors can enjoy the growth, expansion, and innovation of the global economy. Additionally, dividends from many stocks can enhance total returns, providing a steady income stream or reinvestment opportunities.
In this post, we will explore some of the best long-term stocks to hold in 2024.
Best Long-Term Stocks to Hold Now
When buying long-term stocks, it’s best to pick well-established, financially sound companies with long track records of success. The following stocks are excellent choices due to their strong market positions, growth potential, and resilience in various economic conditions.
1. Taiwan Semiconductor Manufacturing Co. Ltd. (NYSE: TSM)
Taiwan Semiconductor is a major player in the global tech industry, producing semiconductors that power everything from smartphones to advanced computers. As technology continues to evolve, the demand for semiconductors is expected to grow, making TSM a solid long-term investment. Analysts predict that TSM will see significant revenue growth over the next few years, driven by the ongoing demand for high-tech devices. With a market value of $895 billion, TSM is poised to benefit greatly from the tech sector’s expansion, making it a smart choice for long-term stock investors.
2. Exxon Mobil Corp. (NYSE: XOM)
Exxon Mobil is one of the world’s largest energy companies, with a market cap of $513 billion. While it is traditionally known for its oil and gas operations, Exxon is also making strides in renewable energy. The company produces a wide range of products, including lubricants and chemicals, which are essential for various industries. Exxon’s strong dividend yield of 3.3% makes it an attractive option for long-term stock investors looking for steady income. As the global energy landscape evolves, Exxon’s diversified portfolio positions it well for future growth.
3. UnitedHealth Group Inc. (NYSE: UNH)
UnitedHealth Group is a leading company in the healthcare sector, with a market value of $445 billion. It offers a variety of health insurance and benefit plans, as well as direct healthcare services and technology. With an aging population driving increased demand for healthcare services, UnitedHealth is well-positioned for long-term growth. The company also provides health-related financial services and technology solutions, making it a comprehensive player in the healthcare industry. UnitedHealth’s dividend yield of 1.7% adds to its appeal for long-term stock investors seeking both growth and income.
4. Costco Wholesale Corp. (NASDAQ: COST)
Costco Wholesale operates a successful members-only wholesale club business, with a market cap of $380 billion. Known for its loyal customer base and profitable business model, Costco runs over 870 stores worldwide, offering a wide range of products from groceries to appliances. Analysts predict steady revenue and earnings growth for Costco, driven by its strong membership model and expanding international presence. The company’s consistent performance and customer loyalty make it a reliable choice for long-term stock investors.
5. AT&T (NYSE: T)
AT&T is a telecommunications giant with a long history, tracing its roots back to 1885. With a market cap of $125 billion, AT&T has evolved into a leader in 5G technology, boasting the largest wireless network in North America with over 210 million customers. The company’s focus on telecom, following its spinoff of WarnerMedia, positions it well for future growth in the communications sector. AT&T offers a high dividend yield of 6.3%, making it an attractive option for long-term stock investors seeking steady income and growth potential.
Why Should You Hold Stocks for the Long Term?
Holding stocks for the long term is one of the most effective ways to build wealth. When you buy a stock, you own a portion of that company. As the company grows and becomes more profitable, the value of your shares increases. This means that over time, you benefit from the company’s success and the overall growth of the economy.
Stocks tend to be volatile in the short term, with prices fluctuating due to market conditions, economic news, and other factors. However, over the long term, the stock market has historically shown an upward trend. By holding your investments for a longer period, you can ride out short-term market fluctuations and take advantage of long-term growth.
Additionally, many companies pay dividends to their shareholders. Dividends are a portion of a company’s earnings distributed to shareholders, providing a regular income stream. Reinvesting these dividends can significantly enhance your overall returns through the power of compounding.
Long-term stocks also reduces the costs associated with frequent trading, such as transaction fees and taxes on short-term capital gains. By maintaining a long-term perspective, you can maximize your investment returns, benefit from compounding, and achieve greater financial stability and growth over time.
Also read: 6 Benefits of Investing in Long-Term Stocks