Bear markets come and go, but companies with true staying power can rise to the top and deliver wins for investors time and time again. Finding those winning businesses doesn't have to be complicated.
No investment is guaranteed, and every investment carries a certain level of risk. However, companies with robust underlying businesses, solid leadership, and the competitive advantages to carry them forward in a variety of environments can pose tempting buys in any market environment -- even the turbulent one that investors are witnessing currently. Here are two such unstoppable stocks to add to your buy basket right now.
1. Airbnb
Airbnb (ABNB 1.03%) has made a name for itself in the travel space, but it's increasingly differentiating itself from the average travel stock as management works to expand its potential consumer base in a rapidly evolving industry. The return of business travel, and the ability of more people to travel for leisure trips as borders have reopened and society has moved on to a post-pandemic normal, have provided tremendous growth to Airbnb's business over the past several quarters. The company has amassed an impressive stockpile of cash ($7.5 billion at the end of the third quarter), and profitability remains strong.
Currently, Airbnb controls about 20% of the vacation rental industry. Beyond forward-looking travel industry tailwinds -- even if spending slows down in a potential recession, people will still continue to travel for business and personal reasons over the long term -- changes spurred on by the pandemic in the way that people live and work also portend well for Airbnb.
Airbnb has identified the rise of remote work as a key, long-term factor in its future success. The company is already investing in the growth of the digital economy as a means of setting itself up to benefit from the lodging needs of remote workers over the long term. Besides launching a "work from anywhere" program for its own employees, Airbnb is partnering with local governments around the world to provide resources like remote hubs for digital workers.
These initiatives help people capitalize on the flexibility of remote opportunities, while easily accessing resources to help them resolve concerns like visas, entry information, and, of course, accommodation. Already, about one-fifth of the stays booked on Airbnb's platform are long-term bookings, which is when a user books a stay of at least 28 days.
There's still significant untapped potential here for Airbnb to explore. Airbnb's existing market share and inroads with customers seizing upon the work-and-travel revolution, paired with its clear use cases for vacationers and business travelers, paint a bright picture for its future growth over the next decade and beyond.
2. Mastercard
Mastercard (MA 0.30%) has proven to be a reliable investment through the years, in large part due to the simplicity of its business model and the considerable market share it has amassed in the broader payment processing market. The company makes money in a few different ways, but its primary source of income comes from transaction fees.
These are the fees it charges to its clients -- large financial institutions like banks -- that distribute Mastercard products to consumers. The more gross dollar volume processed in a given period, the more transaction fees Mastercard earns as a result. As of 2021, Mastercard controlled the second largest share of all credit card purchase volume in the U.S., comprising a roughly 24% slice of this total market.
Mastercard-branded products accounted for 36% of all credit cards in circulation in the U.S. in 2021. Bear in mind, the financial stock generates a significant portion of revenue outside the U.S., and the total payment processing market is rapidly growing as adoption of digital payment solutions expands around the world. By the year 2030, the global payment processing solutions market is expected to hit a valuation of $146 billion.
2022 was another banner year for Mastercard. The company reported net revenue of $22 billion in the 12-month period, up 23% from 2021 on a constant currency basis, while net income totaled $10 billion, a constant currency increase of 21% from the prior year. These stellar figures were driven by a 12% growth in overall gross dollar volume and a whopping 45% jump in cross-border volume.
Mastercard continues to demonstrate the overall strength of its business, even as worries about rising consumer debt and fluctuating spending patterns remain against the backdrop of a potential recessionary landscape. For investors, this dividend-paying stock, which has delivered a total return of 126% over the trailing five-year period alone, remains a stalwart pick to buy and hold in a wide range of market environments.
