August 13, 2012 | In: General

Top 10 Stocks to Hold Forever

Most of us don’t think about buying and holding stocks, but we’re there for the quick money. We buy some shares, we wait until they go up (or until they go down below a certain threshold), and we sell to make some money or limit our losses. I have to admit that most investors, including myself, are not really contributing to the well being of any company – we’re just enjoying the free ride to make some money for our retirement.

But why is it that we don’t buy and hold stocks?

Well, there are two major reasons for this:

  1. We’re in this for the money, and only for the money.
  2. Most of us don’t think that there are companies out there which stocks are really worth holding.

The first reason we can’t do anything about it, but how about the second one, is it true that there are no stocks out there that are worth holding for the very long term?

I personally don’t think so – I think that there are many stocks currently trading that are worth to buy and hold for ages. Here are the top ten that I can think of:

  • 1. McDonald’s (NYSE: MCD): When people stop eating cheap food (in all the meanings of the word), then you can start worrying about this stock. This stock has went up even in the darkest times.
  • 2. Philip Morris International Inc. (NYSE: PM): If you have no problem with the ultimate sin stock and destroying people’s lives, then buy some PM for yourself, your son, and your grandson. Despite all the anti-tobacco regulations and all the crazy warnings on cigarette packs, this stock is here to stay. By the way, I think PM got a boost because of Mad Men – smoking is now returning to be a trend.

  • 3. Procter & Gamble (NYSE: PG): Although there is an increasing number of dirty and smelly people, I suspect people will continue to 1) take showers, 2) wash their hands, 3) die their hair, 4) (hopefully) shave and brush their teeth, and 5) wash their clothes. Procter & Gamble has important products for all that (and more!). That stock will be here in 100 years from now – maybe under some other ticker, but it’ll still be here.

  • 4. Colgate-Palmolive (NYSE: CL): While Procter & Gamble has all the brands that Colgate-Palmolive has (and much more), Colgate-Palmolive is a company that is loved by people – they make one of the most used toothpaste on the planet, and they also care about the local communities. Colgate-Palmolive is an excellent stock to buy, and to hold!

  • 5. Kellogg Company (NYSE: K): Humans have been having breakfast since their existence – I don’t see that trend going anywhere. And what a better way to start the day than with good old bowl of Corn Flakes made by Kellogg’s whether it’s tomorrow or a hundred years from now? Oh, and I’m confident that many people, including myself, are not going to start their day with a Chinese cereal (yes – my TV may be made in China, my clothes may be made in China, my car may be made in China, but by God I’m not eating any cereals – or any other type of food – made in China!)

  • 6. United States Steel Corporation (NYSE: X): True, the most important steel corporation in America (and perhaps the world) suffered a lot from the recession that started in 2008 and that still haunts us. But we all know that the recession will not stay, and new construction will resume, and steel will be in demand again (even in greater demand in the medium and distant future). X is a complete bargain at the moment – buy it!

  • 7. Wal-Mart Stores, Inc. (NYSE: WMT): People are getting more and more frugal, especially in the west (by west I mean western countries, and not the American West). Wal-Mart is a synonym for frugality. Wal-Mart sells cheap foreign made trash (including clothes) that people use on a daily basis. The stock is here for a long time, but as you can see I don’t like their business model. By the way, a couple of decades ago, Wal-Mart used to sell good quality stuff made in the US.

  • 8. International Business Machines Corp. (NYSE: IBM): This is the only IT company that you will see on this list. IBM started its business selling PCs, and then shifted away from that model and started selling services, mainly overpriced IT consultancy services (such as installing a switch for $50,000 – true story that happens nearly every day in IBM) to large companies and to governments. IBM was successful at both endeavors. A company that completely changes its business model depending on the market is a company that will continuously succeed. IBM is always a bargain!

  • 9. Ford (NYSE: F): Yes, I know many people have lost a lot of money on this stock in the past few years, but the thing is, Ford is healing from the worst crisis that hit its business for a long time now – and it’s doing a very good job at that. People will still buy cars in a century from now, and Ford is still a good car (better than many out there, including Fiat, Mazda, Renault and the likes).

  • 10. L’Oreal (EPA: OR): The only non US-listed company in this list, L’Oreal symbolizes beauty for women, and all women want to be beautiful. I’m pretty confident that this will not change at all! Women will always buy L’Oreal products. By the way, L’Oreal is very similar to Colgate-Palmolive in its production policies encouraging local labor.

  • As you can see in this list, I haven’t included any bank (as I think all banks are doomed), no oil companies (because I don’t think we will use oil even 50 years from now), and no IT and technology companies (with the exception of IBM; I think all IT and technology companies, including Apple, are doomed since IT is very tricky and requires a lot of agility to keep up with new trends).

    This article (as well as all other articles on this website) is an intellectual property and copyright of Fadi El-Eter and can only appear on fadi.el-eter.com.

2 Responses to Top 10 Stocks to Hold Forever

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Pete Nice

September 11th, 2012 at 1:13 am

You do realize that Fiat, Mazda, and Renault all have manufacturing agreements with Ford? If they do poorly so does Ford…

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June 7th, 2014 at 1:04 pm

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