Just because the past year made a mess of everything doesn't mean investors should stop thinking about the coming year, or the coming decades and beyond. We'll eventually look back on 2020 as a blip in the grander scheme of things.
And that means we still need to think about the investments we're going to make today that will sustain us in the future. While this year made our lives topsy-turvy, here are three great stocks to buy and hold for decades, regardless of the craziness of the moment.
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1. Amcor
Amcor (AMCR 0.89%) isn't a stock many investors would think to turn to right away, if they thought of it at all. The packaging industry doesn't have sexy growth models, yet that's exactly why you should consider it: It's a steady but vitally necessary part of almost every part of our daily lives and has seen sales grow as a result.
Flying under the radar of many, Amcor makes rigid and flexible packaging for food, beverage, pharmaceuticals, and personal-care products. That's a strategic benefit, because those industries are very stable markets, and 90% of Amcor's sales are into these verticals. Further, the pandemic caused little to no disruption in its performance.
This isn't a stock that will see quick, meteoric gains, but will rather be one that day in, day out plods along generating returns for shareholders. Amcor pays a dividend that currently yields over 4% annually, one it has raised every year for 25 consecutive years, a bit of extra security for investors looking for stocks that will provide for them over the long haul.
2. Clorox
Clorox (CLX 1.24%) is another steady-eddie stock that also just so happened to find itself perfectly positioned to capitalize on the need for cleanliness and sanitation during the pandemic. More so than toilet paper that was suddenly in short supply during the initial outbreak only to find an equilibrium again shortly after, Clorox Wipes are still a hard-to-find product, though not for lack of trying.
Clorox has its plants working around the clock to fill orders and has hired third-party manufacturers to help, but it still says it won't be able to catch up with demand until well into 2021. Consumer product sales jumped 39% last quarter along with a 27% gain in health and wellness segment , leading profits to more than double from the year-ago period.
What may be more surprising to many investors is that its Kingsford charcoal brand has really been the star of the show. Consumers continued to cook more at home than go out to restaurants to eat, leading analysts to boost their expectations for the coming quarter as a result.
Clorox has a 50-year history of paying a dividend and has increased its payout every year since 1977. While nothing is guaranteed, look for this consumer staples giant to help investors clean up in the market for decades to come.
3. ExxonMobil
The pandemic certainly showed the vulnerabilities associated with energy behemoth ExxonMobil (XOM 0.02%). Beyond just the health crisis, governments around the world forced large swaths of the public to stay at home, crushing travel and transportation and grinding down the need for oil and gas. The price of oil plummeted, but the energy giant hunkered down, has cut capital spending to a bare minimum, and has made preserving its dividend a focal point of its operations.
Yet 2020 marked the first time in 18 years that ExxonMobil did not raise its dividend, though the payout for the calendar year was higher than the prior year, preserving a 38-year record and keeping its status secure as a Dividend Aristocrat (in fact, all three stocks featured here are part of that illustrious group of companies).
Still, Exxon has positioned itself to capitalize on the rebound in oil prices, and as natural gas becomes even more of the go-to energy source in the coming years, this supermajor producer will be there to grow with it.
Its dividend yields over 8%, paying you for the depressed price of its stock, which is down 40% year to date, but the global recovery likely to come will reward shareholders handsomely for their patience.
