Volatility and short-term unpredictability are a few of the guarantees that Wall Street offers investors. Since the green flag waved in January 2020, all three major stock indexes have oscillated between bear and bull markets on a couple of occasions.
However, the Dow Jones Industrial Average, S&P 500, and Nasdaq Composite have a lengthy track record of putting stock market corrections firmly in the back seat and heading higher over the long term. This practical guarantee means anytime can be the ideal time to invest.
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What's great about putting your money to work on Wall Street is that most online brokerages have completely done away with minimum deposit requirements and commission fees for common stock trades on major U.S. exchanges. For everyday investors, it means any amount of money -- even $100 -- can be the perfect amount to put to work in the stock market.
If you have $100 that's ready to invest, and this is cash you're absolutely certain isn't going to be needed to pay bills or cover emergencies as they arise, the following three stocks stand out as no-brainer buys right now.
Pfizer
The first genius stock that's begging to be bought with $100 right now is pharmaceutical titan Pfizer (PFE -0.08%).
It's pretty incredible what a difference a couple of years has made to Pfizer's stock. During the early stages of the COVID-19 pandemic, the company could seemingly do no wrong. In 2022, its COVID-19 vaccine (Comirnaty) and oral treatment (Paxlovid) generated more than $56 billion in combined sales. This year, the company expects revenue from its two star COVID-19 therapies to come in at $8 billion.
Though witnessing an estimated $48 billion in annual sales get wiped away in two years may be disappointing, the $8 billion in sales Pfizer anticipates collectively bringing in from Comirnaty and Paxlovid is above and beyond what the company was generating in sales when 2020 came to a close. From a sales perspective, Pfizer is much a better company now than it was three years ago.
More importantly, its non-COVID product portfolio hasn't stopped growing. Despite battling the patent cliff on numerous occasions, Pfizer recognized 7% currency-neutral sales growth last year, excluding Comirnaty and Paxlovid. In 2024, it expects operational sales growth of 3% to 5%, excluding the impact of its COVID-19 therapies.
The key driver for Pfizer is its Specialty Care segment, which delivered 11% operational growth in 2023, sans currency movements. The company's Vyndaqel family of products generated $3.32 billion in sales last year (up 36% year-over-year), while sickle cell disease drug Oxbryta more than quadrupled its sales to $328 million.
Another reason to be optimistic about Pfizer's future is its now-closed acquisition of cancer-drug developer Seagen. Although this deal will reduce Pfizer's 2024 earnings per share by $0.40, the combination of both companies should yield significant cost savings, as well as vastly expand Pfizer's cancer-drug pipeline.
A forward-year earnings multiple of 9.5, coupled with a 6.5% yield, makes Pfizer a top-tier buy if you have $100 to invest.
Philip Morris International
A second phenomenal stock that makes for a no-brainer buy with $100 right now is tobacco giant Philip Morris International (PM -0.69%).
It's no secret that tobacco companies are facing unprecedented challenges. Over time, consumers have become aware of the potential dangers of long-term tobacco use. As a result, cigarette shipments have been stagnant or declining for most tobacco companies. But the good news for current and prospective investors in Philip Morris is that it has well-defined competitive advantages to help overcome these challenges.
The obvious advantage for tobacco companies is that they typically boast exceptional pricing power. Tobacco contains nicotine, which is an addictive chemical. Historically, smokers have demonstrated a willingness to absorb price hikes that offset, or more than offset, declines in cigarette shipments.
Another competitive edge that Philip Morris offers investors is its geographic diversity. This is a company that offers its products in more than 180 countries. If, for instance, tougher regulations in select developed markets are hurting cigarette shipments, Philip Morris can likely count on volume growth from emerging markets to somewhat or fully offset this weakness. Having operations in so many countries is what allows it to generate predictable operating cash flow every year.
Philip Morris is also aggressively expanding its product portfolio into the smokeless segment. In 2023, it shipped more than 125 billion heated tobacco units (HTU) -- that's a nearly 15% improvement from the previous year -- and increased its HTU share in markets where it sells its IQOS heated tobacco device by 120 basis points to 9.1%. Though it could be a while before smokeless products grow into a sizable percentage of Philip Morris' total sales, the company has laid the groundwork for future growth.
Shares of Philip Morris International can be scooped up right now for a 17% discount to its average forward-year earnings multiple over the trailing-five-year period. Best of all, patient investors can rake in a 5.9% annual yield.
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Baidu
The third stock that's an absolute no-brainer buy with $100 right now is China-based Baidu (BIDU -2.61%).
China stocks come with two risks at the moment. To start with, the reopening of China's economy following strict COVID-19 mitigation measures hasn't gone as planned. Economic data has signaled weaker-than-anticipated growth.
The other issue with China stocks is the unpredictability of regulators. Corporate oversight in China is a lot different than in the U.S., and that tends to be reflected in the underlying valuations of most China-based companies.
Despite these concerns, Baidu has all the hallmarks of a screaming buy at the moment.
The company's bread-and-butter cash generator is its internet search engine. Because China's economy is so tightly regulated, Baidu hasn't had any trouble dominating its peers. In March, it accounted for more than 60% of internet search share in the world's No. 2 economy by gross domestic product (GDP). It's evident that Baidu is the top choice by businesses wanting to reach Chinese consumers with their message.
To add to this point, Baidu should benefit as the Chinese economy regains its footing. It'll take time to work out the supply chain kinks that three years of very stringent COVID-19 lockdowns created. Once these clear, it wouldn't be a surprise to see China's economy sustaining annual GDP growth north of 5% and further lifting Baidu's ad revenue.
Baidu is also a leading artificial intelligence (AI) stock. The company's AI Cloud ranked fourth in cloud service infrastructure spend in mainland China, as of March 2023. Enterprise spending on cloud services is still in its infancy, and the margins associated with cloud services are considerably juicier than ad-based margins.
Further, Baidu is the parent of Apollo Go, the world's top autonomous ride-hailing company. As of January 2, Apollo Go had surpassed 5 million autonomous rides.
To wrap things in a nice bow, Baidu closed out 2023 with more than $28 billion in cash, cash equivalents, and various investments. It has more than enough cash to invest in high-growth initiatives, as well as navigate whatever choppy waters may lie ahead. At 8 times forward-year earnings, Baidu may never be this cheap again.
