Investing for the long term requires a disciplined and resilient mindset to navigate the inherent volatility of the stock market. Managing the psychology behind your investment decisions is as crucial as selecting the right investments.
The market price of a stock is often driven by short-term emotions and news, while its true value is tied to the underlying company's long-term earning power and assets. A strong mindset allows you to view temporary price drops as potential buying opportunities for quality assets, not reasons to panic.
Likewise, if you're focused on the long-term picture, you can select quality businesses with robust fundamentals that make sense as part of your portfolio without being swayed by short-term market volatility. If you have cash to invest in the stock market right now, here are four stocks to consider buying and holding for at least five years.
Image source: Getty Images.
1. MercadoLibre
MercadoLibre (MELI 0.30%) is the clear e-commerce leader across over a dozen countries in Latin America, including major markets like Brazil, Mexico, and Argentina. It has a significant competitive advantage over global players like Amazon due to its established presence, brand recognition, and deep understanding of local market needs.
The company operates a vast tech ecosystem, including its e-commerce marketplace connecting buyers and sellers, which is powered by its integrated fintech arm Mercado Pago, its robust logistics business Mercado Envíos, and advertising services. It's worth noting that Mercado Pago has grown into a full digital financial services platform (e.g., payments, credit, savings, investments) that serves the region's large unbanked population and has created a sticky user base with high monetization potential.
NASDAQ: MELI
Key Data Points
The company is consistently profitable and boasts impressive growth metrics. In Q3 2025, it reported a 39% year-over-year revenue increase. Total net revenue reached $7.4 billion. Total payment volume reached $71 billion, up 41% year over year, and gross merchandise volume rose to $16.5 billion, a 28% year-over-year spike.
Robust e-commerce performance in core markets like Brazil and Mexico bolstered MercadoLibre's quarterly performance. And, the number of successful items sold grew by 39% year over year to 635 million. If you want to invest in an e-commerce and fintech giant operating outside the U.S., MercadoLibre is a profitable and compelling leader to consider.
2. Microsoft
Microsoft (MSFT 0.34%) managed to effectively monetize generative AI faster than most peers by integrating it across its entire tech stack. AI services accounted for roughly 15 percentage points of the total Azure revenue growth in the first quarter of its fiscal year 2026. Over 70% of Fortune 500 companies have adopted Microsoft 365 Copilot, which has created a high-margin recurring revenue stream.
The company is investing heavily in AI capacity, and its capital expenditures have exceeded $30 billion per quarter to meet surging demand. Azure remains a primary catalyst for the business's long-term value and consistently delivers high growth even on a massive revenue base. For the full fiscal year 2025, Microsoft's annual revenue surpassed $281 billion, growing by 15% from the prior year. Azure revenue was more than $75 billion, a 34% increase year over year. Azure holds approximately 20% of the global cloud market.
NASDAQ: MSFT
Key Data Points
Microsoft maintains one of the strongest balance sheets in the corporate world, which supports its consistent returns to investors. It's one of only two U.S. companies with a perfect AAA credit rating (that's higher than the U.S. government). The company generated over $100 billion in net income in fiscal 2025, so it continues to have massive flexibility for R&D and acquisitions.
Microsoft has raised its dividend for 20 consecutive years and regularly repurchases billions in stock (it returned almost $11 billion to shareholders in the most recent quarter alone through dividends and share repurchases). Management and analysts have set ambitious targets for the next five years. CEO Satya Nadella aims to exceed $500 billion in annual revenue by 2030, nearly double its current scale.
3. Alphabet
Alphabet (GOOGL +0.90%) (GOOG +0.85%) is deeply integrating powerful AI models like Gemini across its massive ecosystem (e.g, Search, YouTube, Cloud). AI improves its search relevance, makes YouTube more engaging, and personalizes user experiences, which in turn can drive better engagement and more ad dollars. Instead of cannibalizing search, Alphabet's new tools like AI summaries are increasing ad impressions and conversions, and expanding its commercial pathways in search.
Alphabet is also leveraging its custom TPUs (Tensor Processing Units) semiconductor chips to compete in cloud infrastructure. While historically the company had reserved most TPUs for in-house use and cloud services, it has recently begun selling some directly to third parties in specific bilateral deals. These include major AI clients like Anthropic as Alphabet creates a new high-margin revenue stream.
Alphabet's TPUs are revolutionary, particularly because they are application-specific integrated circuits (ASICs) purpose-built for the core mathematical operations of deep learning applications. This specialized design provides significant advantages in performance, energy efficiency, and cost-effectiveness at scale compared to the more general-purpose graphics processing units (GPUs). Revenue from TPUs is a key driver of the overall Google Cloud segment's growth, which generated robust Q3 2025 revenue of $15.2 billion, a 34% year-over-year increase.
Analysts from firms like Morgan Stanley project that expanded external sales could add billions in new revenue to Alphabet's top line in the coming years (an estimated $13 billion for every 500,000 units sold by 2027). AI could also unlock opportunities in robotics (Waymo), healthcare, and enterprise solutions outside of Alphabet's traditional advertising and cloud businesses. Alphabet's strong balance sheet with substantial cash and low debt, and a generous history of providing enviable returns to shareholders, are icing on the cake for long-term investors in this storied business.
4. Taiwan Semiconductor Manufacturing
Taiwan Semiconductor Manufacturing (TSM +1.50%) or TSMC is the undisputed leader in semiconductor manufacturing and controls roughly 70% of the global foundry market. Unlike investing in a single chip designer, holding TSMC can allow investors to profit regardless of who wins the AI race. And the reality is that there will likely be many winners as the AI revolution heats up.
The demand for AI computing power is soaring, and only a few companies possess the capabilities to design the required chips. All major AI players -- including Nvidia, Apple, and Broadcom -- rely on TSMC to build their most advanced chips. The company produces at least 90% of the world's most advanced chips, which has created a massive technological moat that competitors like Intel and Samsung are currently struggling to bridge.
NYSE: TSM
Key Data Points
Management expects AI-related revenue to grow at a more than 40% compound annual growth rate (CAGR) over the next five years. TSMC had a very strong Q3 2025 financially and beat expectations with both record profits and revenue. Substantial and growing demand for AI chips and high-performance computing (HPC) drove revenue up over 30% year over year. Net income surged 40% year over year, and TSMC's gross margin improved to 59.5%.
TSMC is aggressively expanding its manufacturing footprint outside of Taiwan. The company has committed $165 billion to build six advanced fabs in Arizona, with the first already being in volume production. Additional major investments are underway in Japan and Germany, and management aims to have 30% of its most advanced capacity located outside Taiwan by 2028. Shares are up about 40% year to date, and it may be wise to scoop some up before the business soars higher.
