Robinhood Markets' trading app has become synonymous with the boom of millennial retail investors. And as both an investor and a millennial myself, I love that convenient apps such as this make trading stocks easier and more accessible than ever before. Robinhood stocks tend to get a bad rap, particularly as some of the most-held stocks on the platform clearly got there because of hype and not because of their viability as solid long-term investments.
However, investors with a buy-and-hold approach can still find plenty of golden eggs on this platform -- stocks with durable portfolio staying power. Here are three such companies, two of which are holdings in my personal portfolio.
Let's dive right in.
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1. Intuitive Surgical
Whether you're a newbie investor or have years of stock trading experience under your belt, investing in healthcare stocks can be an excellent way to stabilize your portfolio against rough patches and generate sustainable long-term returns in a variety of markets. Among the many great things about investing in healthcare stocks is that there's something for every type of investor, from growth stocks to value stocks to dividend stocks.
One of my favorite high-growth healthcare stocks is Intuitive Surgical (ISRG 1.37%), the leader in robotic-assisted surgery (it controls about 80% of this global market). The company is known for its flagship product, the da Vinci surgical system, used in a range of minimally invasive procedures, as well as its Ion lung biopsy system. Many patients delayed medical procedures at the height of the pandemic in 2020, which had a negative impact on the company's sales, but Intuitive Surgical's balance sheet rebounded quickly. It closed out 2020 with only a 3% decline in sales for the full year, coupled with a fourth-quarter revenue surge of 4% year over year.
Intuitive Surgical's most recent quarterly report was a testament to its continued recovery from pandemic headwinds. During the second quarter, the company's net income popped 72% year over year. In addition, shipments of its da Vinci Surgical Systems and procedures utilizing these systems increased by 84% and 68%, respectively, from the year-ago quarter.
Intuitive Surgical has a solid track record of delivering substantial share-price appreciation. The stock is up by well over 700% from where it was trading a decade ago. Even with its upcoming stock split, Intuitive Surgical's growth streak is far from over. A long-term investment in the company could generate substantial returns as Intuitive Surgical's market dominance drives continued balance-sheet gains and translates to further spikes in the stock price.
2. Amazon
As an investor, it's often tempting to look for the newest kid on the block with the hopes that if you buy into a company early enough, you can garner explosive portfolio gains. While there's nothing wrong with incorporating high-quality small-cap stocks into a balanced portfolio, there's also something incredibly attractive about a tried-and-true company that you can keep returning to again and again for dependable returns.
Amazon (AMZN -0.08%) is most certainly an example of this. After nearly 30 years in business, the company has proven time and time again that its ability to dominate high-growth markets and generate new sources of revenue is virtually limitless. From operating in the multi-trillion-dollar e-commerce industry to cloud computing to grocery retail to the explosive world of digital entertainment, Amazon's diverse and high-performing portfolio of businesses gives it a strong competitive moat.
Quarter after quarter, Amazon delivers exceptional earnings growth that consistently translates to healthy stock-price increases. In the most recent quarter, the company reported that its net sales grew 27% year over year and its net income increased 50% from the year-ago period. The company continues to maintain a solid level of liquidity, and as of the end of the second quarter, its total current assets of about $141 billion more than surpassed its total current liabilities of about $118 billion.
Meanwhile, shares of Amazon have risen about 13% over the past six months alone. The stock is trading about 350% higher than just five years ago. And if the nearly $3,500 price tag for a single share of Amazon has you sweating, thank goodness for fractional investing, which allows you to invest in this unstoppable stock at the exact dollar amount that works for you.
3. Shopify
Another high-flying stock that has become quite popular with Robinhood investors and is also a great long-term investment is the well-known e-commerce platform Shopify (SHOP 3.66%). The company has rapidly gained ground in the highly competitive e-commerce platform space. According to Statista, Shopify is the third largest e-commerce software platform globally, currently capturing an 11% share of this market.
Unsurprisingly, shares of Shopify keep soaring ever higher as the e-commerce industry explodes and the company gobbles up market share. The stock is up about 60% from where it was trading just 12 months ago. And looking back at a five-year snapshot of the stock's growth, it's shot up by nearly 3,500%.
The most recent quarter was a record period of growth for Shopify. It hit $1 billion in quarterly revenue for the first time ever ($1.1 billion, to be precise), which represented a 57% increase from its revenue in the year-ago period. Shopify also generated remarkable net income growth in the second quarter of 2021: Its bottom line surged by more than 2,300% year over year. Merchant solutions and subscription solutions revenue jumped by 52% and 70%, respectively, in the second quarter, while monthly recurring revenue shot up 67% from the year-ago period.
Shopify's platform makes it incredibly easy for entrepreneurs with all types of visions and brand goals to get their businesses up, running, and scaled. With an array of plug-ins that allow Shopify store owners to source products, seamlessly integrate various payment systems, and more, the appeal of the platform is that one needn't be a software genius to use it and build a visually appealing store. While Shopify's platform has become an incredibly popular option with smaller, home-based businesses, some of today's most well-known brands also use the platform as the launching pad for their online store. KKW Beauty, Fitbit, and Penguin Books are all customers. Shopify's ability to appeal companies of all sizes and across a broad swath of industries gives it a competitive advantage that makes it a high-powered investment for all types of portfolios.
