I try to remember that I'm buying a small share of a business and holding it for the long term when I buy stocks. The famed Warren Buffett says his favorite holding time is eternity. It's ambitious, but it's crucial to remember that investment success comes from finding outstanding companies and letting them compound over decades.
Some of my portfolio stocks need more proof to be there permanently, but I can't see selling them. These companies' strong histories and competitive advantages should ensure bright futures. As the phrase goes, "Never say never." However, some equities are as near to never selling as possible.
Costco Every time I struggle to locate parking or wait in the long (yet efficient) checkout line, I wonder why I don't hold more Costco Wholesale (NASDAQ: COST) stock. Although most of my fellow shoppers may not agree, we're all there to take advantage of big supplies and affordable pricing. Costco shares have gained almost 81,000% since its IPO, proving this business strategy works.
Costco, the third-largest global retailer and 12th-largest Fortune 500 corporation, has 874 sites in its fiscal 2024 second quarter (ending February 2024). Its membership model works. Over 92% of Costco members renew, and the corporation earned over $5 billion in membership fees last year.
Low prices attract customers, and Costco sells fewer things than its competitors and turns its inventory over quickly, so it can occasionally sell items before they need to be paid for. This boosts cash flow and cuts costs.
Amazon Other than Costco, Amazon is my favorite retailer. It's not uncommon for me to shop there first. Amazon stock rose 82% in the past year. After the large distribution build-out required by the pandemic surge in orders, the corporation plummeted nearly 50% during the 2022 market crash as it battled to recover.
Amazon is back on track and poised to grow again. Amazon increased revenue by 12% in 2023, but its best results were below the line. Operating and net profits climbed 202% and 1,226%, respectively. E-commerce ultimately recovered after its 2022 troubles, driving these outcomes. In 2023, Amazon Web Services (AWS) increased 13% in revenue and remained the leader in cloud infrastructure.
In recent headlines, Apple (NASDAQ: AAPL) has been in the spotlight for negative reasons. The stock has lost 12% in three months as federal antitrust probes intensify. This news is worth watching, but it will take years to play out, and Apple's share price decrease implies the market is less concerned than some headlines suggest.
Step back and understand that Apple is still a global brand, especially in the US. Apple is steadily becoming a software firm, known for its iPhone and other consumer electronics. Over 2.2 billion Apple devices are installed.
An ecosystem of apps and subscription services generates high-margin revenue for the corporation. Services revenue—which includes subscription products—grew 11% to $23 billion in the last quarter. This is 19% of revenue, up from 18% last year.
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