Who wouldn't want stocks they can keep forever? Think of all the trouble you'll save, not having to frequently find new stocks in which to invest.
It makes sense that if you've got great long-term performers in your portfolio, hang on and let them keep working for you, building your wealth. (And if you inherit such stocks, consider hanging on to them, too.) Here are three companies that seem poised to continue building wealth for shareholders over many more years.
1. Apple
Apple (AAPL +0.37%) needs little introduction. It has grown into an innovative technological juggernaut with a recent market value north of $2.7 trillion, offering consumer products that millions of people can't do without. (It recently boasted more than 2 billion installed devices worldwide.) A 2020 survey found that 40% of respondents would rather give up their dog for a month than give up their smartphone, while 64% would rather give up coffee than their smartphone. Not many companies have such compelling products.
NASDAQ: AAPL
Key Data Points
If you want to hang on to a company forever, you need confidence in its ability to withstand all kinds of economies and changing times. Apple is poised to do so, with ample cash (it generates close to $100 billion of free cash flow annually!) and with strong innovation skills that have helped it introduce many new products, features, and even product categories over the years. Its recent second-quarter earnings report was rather encouraging, too, featuring record revenue for its services and iPhone businesses.
If you're itching to buy shares now, hold on -- because they're not exactly near bargain territory. You'd do well to add Apple to your watch list in order to buy later, or perhaps build a position in the stock gradually.
2. Berkshire Hathaway
Berkshire Hathaway (BRK.A 0.59%) (BRK.B 0.83%), helmed by Warren Buffett for many decades, is also an Apple shareholder, owning more than 5% of the company. But it's a contender for a berth in your portfolio in its own right, too.
NYSE: BRK.B
Key Data Points
Berkshire is also a massive company, with a recent market value topping $700 billion -- and it's a major employer, as well, employing around 383,000 people as of the end of 2022. The company owns many businesses in their entirety, with focuses on insurance and energy, among other things. Its subsidiaries include GEICO, Benjamin Moore, See's Candies, Fruit of the Loom, Clayton Homes, the McLane trucking company, and the entire BNSF railroad. It also owns sizable stakes in other companies, via stock. Along with its Apple shares, it recently owned roughly 20% of American Express, 8.4% of Chevron, more than 9% of Coca-Cola, and 12.6% of Bank of America.
Berkshire is built to last, with 92-year-old Buffett having designated successors who are already investing billions of company dollars and making some management decisions. (Buffett is still the boss, though.) It's long been conservatively run and maintains a big cash war chest, recently $130.6 billion in cash and short-term investments. On top of that, many of the businesses it owns are very defensive -- in industries, such as utilities and insurance, that tend to do well in any economic environment.
3. Charles Schwab
Charles Schwab (SCHW 2.88%) is another solid business to consider for your long-term portfolio. Like other financial services companies, its fortunes are somewhat tied to prevailing interest rates, but there's much more to the company. It's long been a major brokerage, and is even bigger now, having closed on its acquisition of TD Ameritrade in 2020.
NYSE: SCHW
Key Data Points
Schwab is sturdy, with tens of billions of dollars in cash and equivalents on its balance sheet. It recently boasted 34.1 million active brokerage accounts, 2.4 million corporate retirement plan participants, 1.7 million banking accounts, and $7.58 trillion in client assets. Better still, Schwab collects a sizable chunk of its revenue from fees tied to offerings such as its banking accounts, mutual funds, and exchange-traded funds. (In 2022, more than $5 billion, some 27% of total revenue, came from asset management and administration fees and bank deposit account fees.) That's rather dependable revenue, and it helps make Schwab a company that's likely to perform well for its shareholders for a long time.
Do be careful with the concept of holding a stock forever -- because while you might hope and aim to hold certain securities for the foreseeable future, you still need to keep up with all your holdings. After all, even companies that seem indestructible can end up in trouble.
