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A friend of mine asked me today what some good stocks to invest in for the long term were and it occurred to me that I have never wrote about that here. Lately, we’ve been focused on short term trades so today I wanted to share a few picks for the long term.
I’ll call this The Penny Daily’s Long Term Portfolio and I’ll be adding more and more stocks to it as time passes by. And by long term, I mean stocks that will do well in the 5+ year range.
So what are the stocks I would have in my long term portfolio?
- Caterpillar– I like Caterpillar because it is the biggest manufacturer of construction vehicles. And years from now, the emerging economies will continue to grow (look past the difficulty they are having now) and Caterpillar will be a huge beneficiary of this. Emerging economies are going to be building more offices and infrastructure, and the first thing they will do is put in orders with Caterpillar for equipment. It is an excellently run company with a nice dividend. As emerging economies and developed countries continue to grow, watch for Caterpillar’s earnings to sky rocket.
- Pepsi Co. – I like the direction management is moving Pepsi in. Pepsi is looking to get healthier products, and as health seems to be all the craze, Pepsi should do very well in the years to come. Pepsi has been acquiring healthy food companies like Tropicana. Indra Nooyi, Pepsi’s CEO, is very serious about growing Pepsi Co., and ensuring it fits the new demands of consumers. Look for Pepsi to perform exceptionally well in the years to come.
- Verizon– Verizon is a company that is going to benefit from a growing global economy. As emerging economies become wealthier and wealthier, Verizon is going to find a global market for its products. And as the population of the world grows, people will look for new global communication solutions, and Verizon should be leading the way. Their new FIOS T.V is sweeping America. FIOS is what sets Verizon apart from its competitors. Verizon has shown it is not only constrained to the telecommunications industry, they are looking to grow their business in different ways, including T.V and the internet.
- Colgate-Palmolive– This company has products that are here to stay. People will always need personal hygiene products and home care products. As the population of the world increases, Colgate-Palmolive’s earnings will increase as well. Colgate-Palmolive is unique from its competitors, including Johnson & Johnson in that it is not in the pharmaceutical business. While you might think that is a negative, it’s actually not. With the new Obama Administration in office, new health care policies will favor generic brands of medicines, rather than the typical brand names. J&J and other pharma companies will take a hit when consumers move away from their medicines and go to generic brands.
- General Electric– GE is leading the way in new energy. GE windmills have seen a growing demand and as the economy picks up, people will be looking to GE for new environmental solutions, and I have no doubt GE will deliver. GE is going to see its business sky rocket once we come out of this economic mess and energy/environmental solutions take front stage. GE is one of the best companies in America, boasting a AAA credit rating and a huge dividend. GE is also big enough and has enough cash to buy any competitor, so they are here to stay.
- IBM– There is no doubt that this is the era of information technology, and IBM is the leader. IBM is growing its business in all directions, and is breaking frontiers in technology. IBM is not only a tech company, its quickly getting its hands into infrastructure. IBM is doing everything from building a more efficient grid to health care solutions. The world is moving in the direction of utilizing the internet and making it more prevalent in everyday life. IBM is going to be in that business.
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