Which Stock Wins Over the Next 10 Years?
I need your help. Last quarter I opened a real-money portfolio for my two young daughters, and they bought their first stock in Starbucks. The rationale was simple: It's a brand they see every day, they understand what it does, and they think it'll be around when they go to college in 10 years. Now it's time to add another stock to their portfolio, and this is where you come in. We've whittled it down to four finalists:
Amazon.com (NAS: AMZN)
Amazon seems to be going in all sorts of directions these days, but at its core Amazon is a retailer, and my kids understand that. We buy all sorts of things from Amazon and love the free two-day shipping and videos thanks to Prime. My oldest has the Kindle Fire, the younger expects one soon, and my wife and I both love to read on our Kindles.
Amazon's margins are razor-thin thanks to continued spending as it expands its reach. But if its strategy works and offerings like the rumored same-day delivery are successful, profitability could get a serious boost, taking the share price along with it. Either way, I imagine Amazon will continue to play a big part in all our lives for years to come.
Nike (NYS: NKE)
It could be argued that Nike doesn't resonate quite as much with my daughters' generation as it did with mine. There are certainly plenty of options out there in sporting goods and apparel. But the Swoosh is still a global phenomenon, and I don't see that changing.
Nike is a mature company at a $42 billion market cap, but the opportunity in Asian and emerging markets continues to grow. Just last year, almost 30% of revenues came from these regions, versus about 20% in 2008. Neither daughter owns any Nike gear yet, but that's bound to change soon.
Walt Disney (NYS: DIS)
This seems like the biggest no-brainer in history. Disney has been a part of these girls' lives since Day One. I think we have every princess in the book, and the Disney Channel is the most popular channel in the house. ABC, ESPN, and Pixar are all phenomenal pieces of the pie as well, and to top it all off, we just booked a trip to Orlando this fall for their second visit to the Magic Kingdom.
The fascinating thing about Disney is that it's utterly timeless. It was a big part of my life as a kid. Now it's a big part of my life as an adult because of my children. And this cycle just continues to play out generation after generation. Given that the company recently recognized its 56thconsecutive year of dividend payments to shareholders, Disney might need to become a part of their portfolio sooner rather than later.
Apple (NAS: AAPL)
I'd be lying if I said we have only a few Apple products in our house. Between the iPads and iPhones my wife and I have (not to mention the assortment of iPods and a MacBook Air), my girls know Apple and its place in the world. And there's no question it will be a big part of their world for years to come.
My biggest question on Apple is in regard to growth. Granted, the stock is up more than 8,300% over the past 10 years. But at close to $600 billion in market cap, the company will have to do something really special for the stock just to double from here. Is it the best option today? I don't know that it is.
It's time to tweet
There you have it; our Foolish final four. And as I said, I need your help. Last quarter, I got a tremendous response from folks all over Twitter, and it worked so well I want to do it again. So link to my Twitter feed and tell me in 140 characters or fewer which stock needs to be our next purchase. And if you're lucky, your Tweet may be featured in a follow-up piece (or two) right here on fool.com.
The article Which Stock Wins Over the Next 10 Years? originally appeared on Fool.com.Jason Moseris an analyst with Motley Fool One and Stock Advisor. He owns shares of Amazon.com and Starbucks. The Motley Fool owns shares of Apple, Walt Disney, Starbucks, and Amazon.com.Motley Fool newsletter serviceshave recommended buying shares of Apple, Walt Disney, Amazon.com, Starbucks, and Nike, writing covered calls on Starbucks, creating a diagonal call position in Nike, and creating a bull call spread position in Apple. We Fools don't all hold the same opinions, but we all believe thatconsidering a diverse range of insightsmakes us better investors. Try any of our Foolish newsletter servicesfree for 30 days. The Motley Fool has adisclosure policy.
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