I'm Buying These 30 Stocks
TLDRThe speaker shares a list of 30 stocks they believe are worth investing in for the long term, emphasizing the importance of price relative to value. Companies like Microsoft, Google, Southwest, and Meta are mentioned, with a focus on their market dominance, cash flow, and potential for growth. The speaker also stresses the significance of strong balance sheets and the potential for these companies to remain relevant in the future.
Takeaways
- 🌟 Microsoft is considered a great company to own forever due to its control over the software business and significant recovery from past struggles.
- 🔍 Google is valued reasonably and dominates the search engine market, with YouTube and Google being the top two most used platforms globally.
- ✈️ Southwest Airlines is owned by the speaker with a belief in its potential to return to historical profit margins, despite recent challenges.
- 📈 Meta (Facebook) has seen a significant increase in share price and controls major platforms like Instagram and WhatsApp, with a large user base and strong cash flow.
- 💰 Alibaba, despite its share price drop, is seen as a company with huge potential due to its position in China's growing economy and its strong free cash flow.
- 💳 American Express is a luxury credit card brand with a global presence and a perception of elitism over competitors like Visa.
- 🏦 Berkshire Hathaway, run by Warren Buffett, holds a large cash reserve and owns about 90 businesses, but its growth potential is uncertain due to its size.
- 🍎 Apple is ingrained in daily life, generates significant free cash flow, and has a CEO who prioritizes capital allocation and shareholder value.
- 🏦 Visa is a globally recognized credit card company with a strong brand and a large customer base worldwide.
- 🛠️ Home Depot and Lowe's dominate the home renovation and maintenance market, with potential for further growth through store expansion and increased revenue per store.
- 🍔 McDonald's is a growing fast-food chain with a global presence and innovative concepts like the MC cosmic drive-throughs.
Q & A
Which company does the speaker consider as controlling the entire software business?
-Microsoft is considered by the speaker as the company controlling the entire software business.
What is the speaker's view on the valuation of Google compared to the other stocks mentioned?
-The speaker believes that Google is probably the most reasonably valued among the 'magnificent seven' stocks mentioned.
What is the speaker's strategy with Southwest Airlines?
-The speaker's strategy with Southwest Airlines is based on its historical profit margins and the expectation that it can reach close to those numbers again, potentially leading to the stock price going up to $60 a share.
How does the speaker describe the impact of the metaverse on Meta's cash flow?
-The speaker describes that Meta's cash flow has been hit because of the metaverse, but they're still generating amazing cash flow and have not maximized their revenue per user.
What is the speaker's opinion on Berkshire Hathaway's growth potential?
-The speaker is apprehensive about Berkshire Hathaway's growth potential, as he believes it will be hard for them to outperform the market due to its already large size.
What is the speaker's approach to investing in companies with strong balance sheets?
-The speaker aims to invest in companies with great balance sheets, which means they have lots of cash and low debt, to ensure they have staying power.
Why does the speaker mention owning all three credit card companies - American Express, Visa, and Mastercard?
-The speaker owns all three because he believes in their strong balance sheets and wants to buy them when their price makes sense relative to their value.
What is the speaker's view on the potential of Sherwin Williams?
-The speaker views Sherwin Williams as a company with a great brand, great products, and a good balance sheet, which he believes will be around for a long time and will continue to grow.
How does the speaker feel about the potential growth of Ferrari?
-The speaker believes Ferrari has potential for growth by increasing their car production while maintaining a high average selling price and an exclusive brand image.
What is the speaker's strategy for investing in companies that he believes are temporarily overvalued?
-The speaker's strategy is to wait for these companies to fall in price to a level that he deems appropriate based on their value, as he believes in buying when the price is below the value.
Outlines
📈 Investing in Top Stocks for Long-Term Growth
The speaker discusses 30 stocks they would like to own forever, highlighting Microsoft for its control over the software industry and its significant turnaround in the past decade. The importance of price relative to value is emphasized, and the speaker shares their current ownership of Google, noting its reasonable valuation and dominance in search and video platforms. Southwest Airlines is mentioned as a personal investment, with the speaker's rationale based on historical profit margins and the potential for growth. The speaker also discusses their investment in Meta (Facebook), Alibaba, and American Express, each chosen for their market dominance, cash flow, and global brand recognition. Lastly, the speaker expresses cautious optimism about Berkshire Hathaway, despite concerns about its growth potential due to its size and the market's current valuation.
💡 Valuation and Strategy in Stock Selection
The speaker continues their discussion on stock selection, focusing on the importance of a company's balance sheet, specifically looking for companies with high cash reserves and low debt. They mention Visa and Mastercard as examples of strong, globally recognized brands with excellent balance sheets. Home Depot and Lowe's are highlighted for their dominance in the home improvement market, and the speaker's personal favorite, McDonald's, is discussed due to its growth potential and widespread appeal. Disney and Adobe are also mentioned for their strong products and potential for recovery from recent challenges. The speaker emphasizes the need for patience in waiting for the right price to invest in these companies.
🏎️ Luxury Brands and Niche Markets
The speaker discusses various luxury and niche market companies that they are interested in investing in. Ferrari is highlighted for its exclusivity, high margins, and potential for growth in sales. LVMH (Louis Vuitton) is noted for its luxury brand portfolio and strong market position. The speaker also mentions T. Rowe Price, a 401k management company, and its potential as a long-term investment. Sherwin Williams, a paint company, and Generac, a generator manufacturer, are discussed for their strong products and potential for growth. Starbucks is recognized for its brand loyalty and addictive nature, while Otis Elevator Company is acknowledged for its essential services and good balance sheet. The speaker also touches on Pool Corp and its potential受益 from global warming, as well as Costco, which they believe is overvalued at current prices.
🛍️ Retail and Consumer Goods Stocks
The speaker concludes their list of 30 stocks with a focus on retail and consumer goods companies. They mention Target and TJ Maxx for their strong retail presence and appeal to consumers seeking value and discounts. Brookfield Asset Management is highlighted for its asset management capabilities and stable revenue. Sprouts Farmers Market is noted for its focus on high-margin stores and potential for expansion. Cintas, a uniform supplier, is recognized for its steady demand and international growth potential. The speaker reiterates the importance of price relative to value in stock selection and encourages investors to conduct their own research before making investment decisions.
Mindmap
Keywords
💡Microsoft
💡Southwest Airlines
💡Meta
💡Alibaba
💡American Express
💡Berkshire Hathaway
💡Apple
💡Visa
💡Mastercard
💡Home Depot
Highlights
The speaker is interested in owning 30 stocks that they believe have strong potential for long-term growth and value retention.
Microsoft is highlighted as a company that has made a significant turnaround from being considered dead to controlling the software business, with its PE ratio increasing from 9 to 36 or 33.
Google is noted for its reasonable valuation and dominance in the search engine market, with YouTube and Google being the top two search engines globally.
Southwest Airlines is mentioned as a stock the speaker currently owns, with a focus on its historical profit margins and potential for growth based on its current revenue and profit margin.
Meta (Facebook) is recognized for its control over major social media platforms and its impressive cash flow, despite challenges with the metaverse.
Alibaba is identified as a company with strong cash flow and a low valuation relative to its market cap, indicating potential for significant growth.
American Express is praised for its luxury brand status and global growth, with the speaker questioning its current valuation but acknowledging its brand strength.
Berkshire Hathaway is approached with caution due to its large size and the challenge of outperforming the market, despite its significant cash holdings.
Apple is highlighted for its integration into daily life and strong free cash flow, with a focus on its capital allocation strategy under Tim Cook's leadership.
Visa is recognized as a global credit card company with a strong brand and the speaker emphasizes the importance of having a good balance sheet.
Mastercard is included in the list of stocks, with the speaker noting the importance of price relative to value when making investment decisions.
Home Depot and Lowe's are mentioned as dominating the home renovation and maintenance market, with potential for further growth through store expansion.
McDonald's is highlighted for its global presence and growth potential, with the speaker sharing personal experiences with the brand.
Disney is compared to Southwest in terms of its pre-COVID profit margins and potential for recovery, with the speaker noting the reinstatement of dividends as a positive sign.
Adobe is praised for its strong software business, subscription model, and low debt, making it an attractive long-term investment.
Nike is identified as the leading sporting goods brand with a strong balance sheet and the speaker emphasizes the importance of waiting for the right price.
Ferrari is highlighted as the ultimate luxury brand with an exclusive product and high gross margins, indicating strong brand power and profitability.
LVMH (Louis Vuitton) is recognized for its portfolio of luxury brands and strong market position, with the speaker noting the owner's immense wealth as a testament to the company's success.
T. Rowe Price is mentioned as a company that manages 401k plans, with the speaker viewing it as a long-term play despite potential short-term challenges.
Sherwin Williams is highlighted for its dominance in the paint industry and strong balance sheet, with the speaker expressing a desire to own the stock at the right price.
Generac, the generator company, is noted for its strong product offerings and the speaker's personal experience with the stock, emphasizing the importance of price relative to value.
Starbucks is highlighted for its strong brand loyalty and the speaker's personal affinity for the company, with a focus on its potential as an investment.
Otis Elevator Company is recognized for its essential role in providing safe and reliable elevators, with the speaker noting its good balance sheet and potential for ownership.
Pool Corp is mentioned as a company benefiting from global warming, with the speaker waiting for its stock price to fall before considering an investment.
Costco is highlighted as a popular stock with a strong customer service and user experience, with the speaker expressing a desire to own it at a lower price point.
Target is noted for its resilience despite challenges and the speaker's personal investment strategy of buying the stock at lower prices.
TJ Maxx is recognized for its appeal to consumers seeking closeout items at lower prices, with the speaker highlighting its strong revenue growth and margins.
Brookfield Asset Management is mentioned as a company with stable revenue and high returns on investment, with the speaker owning the stock and noting its potential.
Sprouts Farmers Market is highlighted for its focus on high-margin stores and a new CEO, with the speaker expressing dissatisfaction with the stock's recent price increase.
Cintas is recognized as a company providing essential uniform services with potential for international growth, described as not a sexy business but with solid margins and potential.