When it comes to giving holiday gifts, follow in the footsteps of Kanye West: buy some stocks! 

In all seriousness, stocks make great gifts, especially for young children. Not only does owning stocks give them an early start on financial literacy (which isn't really taught in K-12 schools), but due to the miracle of compounding, a small investment today can lead to big things 10, 25, or even 50 years down the road -- if, of course, you buy the right companies.

Today, you can buy stocks in fractional increments (so you can buy, say, exactly $100 worth of a stock, even if the actual share price is higher or lower) through a service called Stockpile.

Last year, I made two recommendations for stocks to buy for others -- especially kids. Unsurprisingly, those two are making reappearances this year, along with a third contender I think is another great long-term buy.

A piggy bank in santa hat next to small gift-wrapped passages.

The best stocks for Christmas gifts. Image source: Getty Images.

Amazon

Amazon (NASDAQ:AMZN) is making a reappearance this year. The stock has been a good performer over the past year, up 43% for 2018, ahead of the overall market. However, Amazon's stock fell sharply along with the rest of the tech sector in October, creating what I think is another great entry point. 

Amazon is benefiting from its clear lead in two huge markets: e-commerce and cloud computing. Of the two,  the cloud computing opportunity is likely the biggest. According to Cisco's Global Cloud Index Report, cloud data center traffic will more than triple between 2016 and 2021. Despite being a huge $28-billion-run-rate business, Amazon Web Services' growth actually accelerated 46% last quarter, an even higher growth rate than the 42% mark set in the third quarter of 2017.

And in Amazon's "old business" of e-commerce, things are humming along as well. During the early holiday shopping period around Black Friday, U.S. online sales increased 16.8% to $58.5 billion, about $1.3 billion ahead of expectations. U.S. e-commerce sales still made up only 9% of overall retail sales last year, according to Statista, but that figure is set to grow to the mid-teens by 2021. As the undisputed leader in U.S. e-commerce, Amazon should continue to benefit from this overall trend. 

Tencent

Unlike Amazon, last year's pick of Tencent (NASDAQOTH:TCEHY) hasn't fared so well. In March 2018, the Chinese State Administration of Press and Publications halted all new video game approvals since March. That's hurt Tencent's stock, as its gaming division is currently its largest segment at roughly 32% of revenue.

However, there are reasons to think the long-term opportunity is still intact for Tencent. Tencent's non-gaming businesses are very exciting. These include WeChat, the 1 billion-user-plus social network; Tencent Video, which now boasts 82 million subscribers; Tenpay, a dominant payment platform in China (along with Alibaba's Alipay); Tencent Music; and Tencent Cloud.

On top of these exciting segments and platforms, Tencent is also a huge investor itself, backing hundreds of smaller (and not so small) tech companies with its excess cash flow.

The gaming ban isn't likely to be permanent (though the industry will likely be more regulated). The current gaming segment hangup has given investors another chance to buy this Chinese internet leader at a discounted price.

Apple

The final pick for holiday giving is one of the most well-known companies in the world: Apple (NASDAQ:AAPL). Like Amazon, Apple is up in 2018, but also well below its recent highs set in early October. 

On its last earnings call, the company scared some investors by announcing that it would no longer disclose hardware units sold, which may have led some to believe that iPhone sales will decline.

However, that's not necessarily the case. Even if units do decline, Apple's premier brand and sticky ecosystem give it a certain amount of pricing power. Meanwhile, the company's growing services revenue -- which made up a respectable 16% of revenue last quarter -- is a recurring, annuity-like stream that should help insulate earnings from too much volatility. With shares now at trading at just 14 times trailing earnings -- and closer to 13 times earnings when stripping out all of the company's excess net cash -- Apple stock has become a bargain once again.

Stuff your stocking with stocks

Amazon, Tencent, and Apple are each fundamentally strong companies with large opportunities ahead of them. That's why each would make a great gift for your loved ones this holiday season.

John Mackey, CEO of Whole Foods Market, an Amazon subsidiary, is a member of The Motley Fool's board of directors. Billy Duberstein owns shares of Alibaba Group Holding Ltd., Amazon, Apple, and Tencent Holdings. His clients may own shares of some of the companies mentioned. The Motley Fool owns shares of and recommends Amazon, Apple, and Tencent Holdings. The Motley Fool has the following options: long January 2020 $150 calls on Apple and short January 2020 $155 calls on Apple. The Motley Fool has a disclosure policy.