What are 3 Warren Buffett stocks to bet on for 10-year profits? The expert’s answer.
What are 3 stocks to buy and hold for 10 years and beyond? Warren Buffett’s investment analysis becomes invaluable in answering this question of traders.
Equity expert Courtney Carlsen has identified a trio of listed companies that can represent a guarantee. First of all, because they were purchased by the Oracle of Omaha, considered the beacon of successful investments.
There is no doubt that the most famous billionaire investor has a long history of outperforming the stock market. Since taking over as CEO of Berkshire Hathaway in 1965, Buffett has returned investors almost 20% per year, enough to turn a $100 investment into $4.4 million today, the expert notes.
So here are 3 Buffett stocks that you can buy and hold with confidence for the next decade (according to the analyst).
1. Chubb
The cash flows of insurance companies make them attractive investments, which is why Buffett has been investing in them for decades, Carlsen points out. Insurance companies can make attractive investments because their products are always in demand and premiums can rise with economic growth and inflation.
As one of the largest property and casualty insurers in the world, Chubb has demonstrated excellent risk management compared to its peers. The company is a conservative underwriter and has done a good job of balancing claims costs and expenses with premiums collected, consistently beating industry peers.
Last year, Chubb generated $15.1 billion in free cash flow, which it can use to pay dividends, buy back shares, or invest in bonds and stocks. It has increased its dividend payout for 31 consecutive years.
According to the expert, the company is positioned to grow with the economy. It can also provide a hedge against the possibility of inflation and higher interest rates, making it a great stock to hold for the next decade and beyond.
2. American Express
What sets American Express apart are its attractive offers that appeal to high-spending consumers, as well as its long-standing loyalty to the brand.
The popular American Express Black Card would require an annual fee of $500,000 just to be issued by invitation. Its Platinum Card, with an annual fee of $695, offers customer perks such as luxury travel
and hotels, airlines, and clothing lines.
American Express is a high-end brand that charges higher processing fees than its peers. While some retailers do not accept the card, it is worth it for American Express users who enjoy valuable rewards.
The company also holds credit card loans, earning interest income and benefiting from rising interest rates. Last year, net interest income increased 33%, rising another 20% in the first half of this year. While holding these loans exposes it to credit risk, American Express’s high-end customers are still the ones who will continue to outspend others amid inflation or an economic slowdown.
3. Moody’s
Moody’s Corporation operates a credit ratings business and enjoys strong competition.
That’s because the credit ratings business is difficult to break into, due to high barriers to entry. It also takes a long time to build a reputation as a credible source for assessing the creditworthiness of companies and debt instruments.
Regulations also make it difficult for new entrants to weed out longtime holders. Moody’s is the second-largest credit ratings firm in the United States, with a 32% market share. Only S&P Global, with a 50% market share, outperforms it.
Moody’s has struggled in recent years due to low debt issuance volumes. However, its strong analysis business has helped support its earnings during the crisis in its ratings business.
The good news for investors is that issuance volumes have started to grow significantly. In the first six months of this year, Moody’s Investor Services (where it accounts for its rating business) reported a adjusted operating income increase of 51% year-over-year.
The firm is therefore well positioned to take advantage of pent-up demand for debt issuance and should continue to play a key role in capital markets in the years to come.
|DISCLAIMER
The information and considerations contained in this article must not be used as the sole or primary basis for making investment decisions. The reader retains full freedom in his or her investment choices and full responsibility in making them, since only he or she knows his or her risk appetite and time horizon. The information contained in the article is provided for information purposes only and its disclosure does not constitute and should not be considered an offer or solicitation to the public to save.|
Original article published on Money.it Italy 2024-08-10 13:26:27. Original title: 3 azioni di Warren Buffett da comprare e tenere per oltre 10 anni
