The Forever Businesses
Some stocks just take care of themselves. It could be the quality of the business model, no competition, or the stellar executive team (ideally all three), but whatever it is, certain stocks require little upkeep. Obviously, you can’t just buy something and literally forget about it for forty years. Earnings letters need to be read, and business plans evolve. You don’t want to end up owning the Sears of the 2050s and not know it.
But that’s typically the only work needed to stay updated with this type of stock. They’re such reliable companies and brands that it can feel like you’re not putting in enough effort, when in fact you might be putting in too much.
These are forever businesses that, unless something catastrophic happens, will have trouble being disrupted over the next few decades. Here are the select few stocks I’d put into this category and why:
Disney: a monopoly on family entertainment.
Visa/Mastercard: 99% of payments will eventually be digital. These companies have a duopoly on this infrastructure.
Microsoft: workplace software and the cloud won’t be going away anytime soon. The ultimate SaaS business.
Tilray: Just kidding. Had to keep you on your toes.
Home Depot: Homebuilding and construction will, in a functioning civilization, continue indefinitely.
McCormick: Every culture (outside of Germany) flavors their food.
Nike: Half of the world population wants to look like their favorite athletes.
Berkshire Hathaway: Stellar capital allocation can’t be beat in a capitalistic society.
Schwab Broad Market ETF (SCHB): It has been foolish to bet against the American economy for the last 250 years. Why start now?
I probably missed some companies, and you probably don’t agree with all my choices. Nothing is ever a guarantee in investing. But these companies, at least in my opinion, come pretty damn close.
Disclosure: The author is not a financial advisor, and may have an interest in the companies discussed.