Many investors take a short-term view of the stock market, seeing it as an opportunity to score quick profits in an effort to produce a meteoric rise in their wealth. Yet most successful investors understand that the biggest gains come from smart stock picks that continue to produce stellar returns year after year, turning even modest investments into big riches. As a result, it's important to try to isolate stocks that have the potential for success in the long run. To help you in your quest, below you'll find three stocks that could give long-term investors the kind of returns over the next decade and beyond that can turn your investment capital into true wealth.
Boeing keeps flying high
The aerospace industry has been going gangbusters lately, and as the largest aerospace and defense company in the world, Boeing (NYSE:BA) has captured more than its fair share of the business that has come from commercial airline companies seeking to upgrade their aircraft fleets and take advantage of a nearly unprecedented period of profitability. Boeing projects that demand for commercial aircraft over the next 20 years will be in the trillions of dollars, and the company has done a good job of winning business with new aircraft designs like the 787 Dreamliner and the massive 777X jumbo jet.
Perhaps what's most impressive about Boeing is how it has generated so much success despite going through tough conditions in its defense business. Now, though, a potential end to government budget cuts appears to be in sight, and heightening tensions in areas around the world could well reverse that trend in the future and give Boeing more sources of revenue. All told, the combination of commercial aerospace demand and prospects for improvement in the defense arena could keep Boeing healthy for decades to come.
Ulta looks beautiful
Beauty is big business, and Ulta Salon (NASDAQ:ULTA) has capitalized on the demand for beauty products with its revolutionary store format. By combining a retail outlet for beauty products with the full-service offerings of in-store salons, Ulta has built up a loyal set of customers that it consistently sees come into its locations for repeat business, and initiatives like the retailer's Ultamate Rewards loyalty program only heighten the devotion that many of its core customers have for the chain.
Recently, Ulta has been firing on all cylinders. Expansion in the company's store network has combined with higher comparable-store sales to produce impressive revenue growth, and Ulta has had particular success in boosting online sales. At the same time, it is investing in its internal infrastructure, building out a new distribution center and seeking to make its supply chain more efficient. Given time, Ulta expects its results to remain strong for the foreseeable future, and judging by the way it treats its customers, Ulta should remain in style for a long time.
Starbucks keeps caffeinating portfolios
For more than 20 years, Starbucks (NASDAQ:SBUX) has given investors solid, dependable returns. Yet even after that much time, the coffee giant still commands long lines at peak times, and its efforts to drive further business have keyed in on what some have referred to as nearly a cult-like following among its regular customers.
Still, Starbucks has plenty of opportunities for improvement. The company has always had more of a morning focus, but its efforts to get people into its cafes at night through its Starbucks Evenings program could open up new opportunities for growth. It has also continued to work on ways to improve its food offerings, with moves like its strategic decision to buy bakery company La Boulange in order to give itself a more complete lineup of products for customers to enjoy. With international expansion opportunities still abundant and with its resilient resistance to competition, Starbucks could continue to provide strong returns well into the future.
Get-rich-quick schemes almost never work, but smart long-term investing has a much better track record of success. By identifying stocks like these three, you can put the odds in your favor toward reaching the financial goals you set for yourself over time.
Dan Caplinger owns shares of Starbucks. The Motley Fool owns and recommends Starbucks, and recommends Ulta Salon, Cosmetics & Fragrance. Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.