Investing isn't about sitting at a desk all day trying to trade your way to wealth. At least, it shouldn't be. It should be simple. Ideally, you buy stocks in great companies and hold them while they slowly and steadily increase in value over time.
In the meantime, you're out living your life. After all, building wealth is about removing money stress from your life. Otherwise, aren't you missing the point?
The hardest part might be finding the types of companies you can buy and hold while sleeping well at night, knowing you made the right choices. FHere are three winners you can count on. Each stock is an industry leader with a proven past and a bright future.
Consider adding them to a diversified portfolio. These easy wealth builders will do all the work for you.
1. Amazon
There might be no better example of a wealth builder than Amazon (AMZN +3.49%). The e-commerce and cloud computing giant has turned a modest $1,000 investment into over $2.3 million in under 30 years. Now, with a $2.4 trillion market cap, Amazon probably won't repeat those returns over the next few decades. However, Amazon still has a clear path to long-term growth.
NASDAQ: AMZN
Key Data Points
E-commerce still represents just 16% of total retail spending in the United States. Amazon (which accounts for 40% of e-commerce in the U.S.) will directly benefit as that percentage increases over time. Additionally, Amazon is the world's leading cloud computing platform, with an approximately 33% market share. Demand for cloud services continues to grow, and the additional tailwinds from artificial intelligence (AI) should only add to it.
These two industries represent most of Amazon's current revenues but don't dismiss emerging opportunities in digital advertising, telehealth, video and live sports streaming, and smart devices (Alexa). Amazon has demonstrated its ability and willingness to pursue growth in almost any industry. There's a good chance Amazon will continue creating wealth for shareholders, making it a no-brainer for virtually any long-term investor.
2. Philip Morris
Many investors think tobacco stocks are a dying breed due to the multidecade decline in cigarette use. However, nicotine is rapidly evolving from cigarettes to popular smoke-free products, like oral nicotine pouches. Philip Morris International (PM 2.95%) has established itself as the leader of the new-age nicotine industry. Following its spin-off from Altria, the company spent years developing IQOS, which heats tobacco to create a vapor (not smoke). Then, Philip Morris acquired the leading oral nicotine brand, Zyn, when it bought Swedish Match.
NYSE: PM
Key Data Points
The company has a diverse business selling Marlboro cigarettes in non-U.S. markets and a strong global portfolio of new-age nicotine products. Smoke-free products contributed 40% to total revenue in Q4 2024. Additionally, shipment volumes for both smoke-free products and cigarettes grew in Q4. Remember, nicotine is notoriously addictive, which gives Philip Morris another growth lever (pricing power) to pull when needed. The company may grow revenue faster than inflation for the foreseeable future.
Investors also get a famous dividend that Philip Morris has raised annually since splitting from Altria. At the current share price, investors can get a 3.5% yield, which should only grow as analysts estimate the company will enjoy high-single-digit earnings growth over the long term. This might be one of the best dividend stocks you can buy and hold.
3. Axon Enterprise
Great companies evolve. Axon Enterprise (AXON +1.14%) started selling nonlethal weapons like Tasers and became a global leader in law enforcement technology. Today, Axon sells nonlethal weapons, body cameras, software, and cloud services to law enforcement and other emergency personnel worldwide. Modern society's need for safety for officers and citizens has fueled Axon's remarkable growth. The stock has turned a $1,000 investment in 2001 to nearly $1.2 million today.
NASDAQ: AXON
Key Data Points
Axon dominates the body camera market but has penetrated only about 14% of the United States. In other words, body camera adoption is a big-picture growth trend with plenty of life left. Axon's body camera and Taser sales also create business relationships, making cross-selling its cloud-based software easier. The software is a potential game-changer for customers because it modernizes evidence management, reporting, and dispatching. For Axon, it creates recurring and profitable revenue.
The bottom line? Investors shouldn't feel like they've missed the boat. Axon generated over $1.9 billion in revenue over the past four quarters compared to an estimated $77 billion total addressable market. Axon still has tons of growth ahead in the U.S. and is just starting in Europe and Asia. The company must continue executing as it has, but Axon's current momentum could last for years.
