If the cost of living crisis has you thinking of what future generations will face 20 years from now, it’s probably time to look for stocks to buy your children now.
Among the best stocks to buy for your offspring are the ones that will thrive over the long-term. For better time management, pick up companies that you can buy and hold forever, or at least the next five years. That means their balance sheets should be rock-solid with stable cash flow. Growth stocks can be a good bet, but value plays that deliver steady returns are also worth grabbing.
It’s also worth considering which of these buy-and-hold-forever stocks your child might recognize. It may be a lot more meaningful and exciting for your child if you were to invest in an interest they already love. Owning a utility stock wouldn’t compare to owning a piece of their favorite video game maker!
Let’s explore some growth and dividend stocks your children would appreciate years down the road.
Microsoft (MSFT)
If your children love video games, consider Microsoft (NASDAQ:MSFT) as an appealing stock to buy your kiddos.
The tech giant that makes Xbox is in the midst of acquiring Activision Blizzard, the company behind the Call of Duty and Warcraft franchises. It’s a good hook to pique your child’s interest.
Further, it’s Microsoft’s entrenched position in our everyday lives that makes it worth considering. The group’s software subscription suite is essential to businesses and individuals worldwide. Additionally, the group’s increasingly powerful cloud offering makes its existing subscription offerings all the more robust over time. Also, MSFT has a head start on the push toward AI, with a major stake in OpenAI.
The group’s business doesn’t come without risk, a slowdown in personal computing has been a drag on overall performance. It’s important to temper expectations when it comes to AI since it could be a while before it takes off. But shares are valued relatively reasonably, and the group’s got a rock-solid balance sheet.
These make for good reasons to add MSFT as a great long-term pick.
PayPal (PYPL)
The shift toward electronic payments makes PayPal (NASDAQ:PYPL) a steady pick among stocks to buy.
While it might seem that digital payments have reached their peak, the market is expected to grow at a compound annual rate of over 20% between now and 2030. PayPal is at the heart of that impressive growth, making it a good pick to buy and hold over the next decade.
Shares are also valued relatively low, thanks to some issues with margin deterioration. The group’s growth is coming primarily from its unbranded payment solution. This allows businesses to use the PayPal platform without the brand stamp. Because this part of the business is lower-margin, it’s hurt the group’s overall profitability and dented investor sentiment.
However with a new CEO at the helm, PayPal’s pledged to improve profit margins. If successful, shares could see a significant jump.
Disney (DIS)
Disney (NYSE:DIS) is the quintessential pick among stocks to buy for your children.
Not only will they get a kick out of owning a slice of their favorite princess or superhero franchise, but you can rest easy knowing that time is on the House of Mouse’s side. Notably, streaming has hit some headwinds which has sent the share price lower. But Disney says that part of the business will yield profits by 2024. Given its enviable trove of mega hits, this doesn’t look out of reach.
Disney stock offers more than the streaming business that’s currently grabbing the headlines. The strength of the business plan is the group’s cash-cow franchises, all with healthy revenue streams.
From producing major movies to selling merchandise and charging a fortune to visit your favorite characters at Disneyland, the group’s able to eke out every last dollar from its assets. True, there’s likely to be some near-term turbulence as the streaming business gets back on track and the cost of living crisis hits consumers. Even still, Disney is a great long-term pick trading at a very reasonable price.
On the date of publication, Marie Brodbeck did not hold (either directly or indirectly) any positions in the securities mentioned in this article. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.com Publishing Guidelines