It’s easy for investors to look for stocks that provide quick returns, but there are a lot of people look for stocks to buy and hold for the next decade.
The advantage is simple: To build long-term wealth, you have to do more than just change your positions every day.
It takes research to find those stocks that can stand the test of time and weather those market downtimes that inevitably come.
But it also takes patience. It’s easy to decide to sell off your stock when you see losses. It takes the patient investor to know there are ebbs and flows to the market and nothing moves up or down in a straight line.
One of the biggest keys to long-term investing and still see some kind of a payout is to find those reputable stocks that come with a dividend — a payment made by a company to its shareholders. It is paid by the revenue the company earns. A dividend can go up or down, depending on its revenues in any given quarter.
That’s why we are going to look at the six stocks to buy and hold for the next decade.
6 Stocks to Buy and Hold for the Next Decade
1. Microsoft Corp.
- Market Capitalization: $1.4 trillion.
- Annual Dividend Yield: 1.07%.
- Total Yearly Return: 57% (2019).
If there’s one tech company that fulfills the “stands the test of time” criteria, Microsoft Corp. (Nasdaq: MSFT) is it.
The Redmond, Washington-based company has dived into just about every avenue of technology — from operating systems to video games.
Now the company is pivoting to capitalize on an emerging cloud computing market as a way to grow profits.
Since 2015, shares of Microsoft have risen more than 358%, and in 2019, it provided a total annual return of 57% — beating the S&P 500 return by more than 20 percentage points.
Microsoft also provides a dividend yield of about 1.06%. That may seem low, but keep in mind it continues to invest in that cloud infrastructure business. As that segment rises, so will the dividend yield.
Because it’s positioned for continued growth, Microsoft Corp. is one of our six stocks to buy and hold for the next decade.
2. Apple Inc.
- Market Capitalization: $1.4 trillion.
- Annual Dividend Yield: 0.95%.
- Total Yearly Return: 87.4% (2019).
We’d be remiss if we didn’t include Microsoft’s biggest rival, Apple Inc. (Nasdaq: AAPL) on the list.
The company started with a computer built in a garage and now has the most popular smartphone in the world. But it expanded into a much wider range of products like the Apple Watch, iPad and even a music platform.
Investor Warren Buffet loves Apple so much that his Berkshire Hathaway Inc. (NYSE: BRK.B) owns more than 5% of the company and is its third-largest shareholder.
For the long-term, Apple can rest on its ever-growing base of users who continue to use the products and services surrounding items like the iPhone.
Apple shares are a bit more expensive than Microsoft, but the payoff is in the returns. Last year, Apple had a total yearly return of 87.4%.
It also pays a 0.95% dividend per share. That may seem low, but it translates to $0.77 per share which is nothing to laugh at.
Because of its growth prospects for the future, Apple is one of our six stocks to buy and hold for the next decade.
3. McDonald’s Corp.
- Market Capitalization: $162 billion.
- Annual Dividend Yield: 2.32%.
- Total Yearly Return: 13.9% (2019).
It’s not glamorous by any stretch of the imagination, but fast-food giant McDonald’s Corp. (NYSE: MCD) will always be in demand.
Despite the rollout of fad diets and changing consumer demand, McDonald’s has had no issue keeping up. It’s added healthier food and value items to its menu to keep customers coming back for more.
While its 2019 total return was just 13.9%, over the last five years that return has been a staggering 118.03%.
Another thing that keeps McDonald’s a stock to have is an attractive dividend yield. Now it stands at 2.29%. Its more recent dividend payment was $1.25 per share which is one of the highest on our list.
And that dividend payment has just gotten bigger since it started paying a dividend in 1976.
The fact that it continues to adapt to the fast-food market and its ever-growing dividend makes McDonald’s one of the six stocks to buy and hold for the next decade.
4. U.S. Bancorp
- Market Capitalization: $85 billion.
- Annual Dividend Yield: 3.09%.
- Total Yearly Return: 33.6% (2019).
The next company on our list is another one that Buffett is high on. So much so that Berkshire Hathaway owns 132.4 million shares — 8.5% of the company — making it the largest shareholder.
U.S. Bancorp (NYSE: USB) is the fifth-largest commercial bank in the country and operates in 25 states, primarily in the center of the country.
Shares of U.S. Bancorp are relatively inexpensive compared to others on the list — currently trading at just over $54 per share — and a recent drop from more than $60 per share means the stock can grow.
It offers one of the highest dividend yield percentages of any other on our list — 3.09%. Its latest dividend payment was $0.47 per share. That’s up from the $0.30 per share it paid in March 2018.
A steadily increasing dividend payment and affordable price make U.S. Bankcorp one of our six stocks to buy and hold for the next decade.
5. AT&T
- Market Capitalization: $280 billion.
- Annual Dividend Yield: 5.41%.
- Total Yearly Return: 48.5% (2019).
One of the next big things to capture our generation will be the implementation of 5G networks around the world.
It will make everything we do — from downloading and watching movies to manufacturing — faster.
A company on the brink of making huge headway into the 5G revolution is AT&T Inc. (NYSE: T).
Long gone are the days of AT&T landline telephone service. Now the company is diversified into mobile technology — it’s the second-largest wireless network in the U.S. — as well as cable and satellite television.
AT&T boasts an affordable price for even beginning investors — currently at around $38 per share — and a solid price-to-earnings ratio of 20.3.
On top of that, it had a total yearly return of 48.5% in 2019.
It also has a strong dividend yield of 5.41% which is the highest by percentage on our list. The last dividend payment to shareholders was $0.52 per share. That has increased from $0.50 per share two years ago.
AT&T’s position in the race for 5G and a steady dividend payment make it one of the six stocks to buy and hold for the next decade.
6. Colgate-Palmolive
- Market Capitalization: $64 billion.
- Annual Dividend Yield: 2.28%.
- Total Yearly Return: 18.6% (2019).
Just about every time you go to the store, you have to purchase things like dish soap and toothpaste. They are consumer essentials, and that’s not going to change anytime soon.
Our final company specializes in producing those items that we all need on a regular basis.
Colgate-Palmolive Co. (NYSE: CL) is responsible for making things like Colgate toothpaste, Palmolive dish soap, deodorant and even laundry supplies.
Last year, it had a total yearly return of more than 18% — its largest return in three years — and this year that return is already at 9%.
Like some of our other companies on the list, Colgate-Palmolive is not too expensive as it currently trades at around $74 per share.
Its dividend yield is at 2.28%, last paying $0.43 per share — up from $0.42 per share it paid in 2018. Colgate’s five-year dividend growth is 20.4% which is strong and steady.
Because it has products we all need and buy, plus solid dividend yield, Colgate-Palmolive is one of the six stocks to buy and hold for the next decade.
One thing to remember when you are looking to invest long-term is you want to find companies that hold their value and provide you that “endless income” in the form of dividends.
The market will go up and down — sometimes drastically in either direction — at any given time. As a long-term investor, you want to find those companies that roll with the punches the market can throw.
The companies we’ve mentioned are just those companies.
That’s why they are the six stocks to buy and hold for the next decade.
Related:
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6 5G Dividend Stocks to Buy Now
4 Cloud Software Stocks to Buy Now
4 Semiconductor Stocks to Buy Now
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