In this article, we will discuss the 10 Best Stocks to Buy and Hold for 20 Years.
As per Ameriprise Financials, the initial months of 2025 were tough for investors. This is because leading US stock indexes ended the first quarter meaningfully lower, countering the investor projections that stocks will continue to move northwards after the 2 strong years of returns. Notably, the tariff uncertainty has impacted the markets this year, while recession odds are increasing, and global trade frictions continue to increase. Since major market areas have corrected from the recent highs, and the outlook has become guarded, the investment firm believes that maintaining a balanced perspective of current conditions remains important during periods of market stress.
What Lies Ahead in Q2 2025?
Ameriprise Financial opines that Q2 2025 is expected to bring as much uncertainty and volatility for investors as Q1 2025. That being said, the investment firm believes that the bullish case for stocks is expected to prevail long term, considering the current firm US economic and profit conditions. However, the threat of Trump’s tariff policies and the possible retaliatory tariffs can change the broader market dynamics.
Nevertheless, the investors should not deviate from the well-diversified portfolio. As per Ameriprise Financial, the investors are required to focus on holding high-quality assets throughout their portfolio, make sure that their allocations are in line with their risk tolerance, and that they take a longer-term view of the current market stress, which, historically, can result in opportunities to dollar-cost average in the high-quality assets.
READ ALSO: 7 Best Stocks to Buy For Long-Term and 8 Cheap Jim Cramer Stocks to Invest In.
What Could Support Equities?
As per Ameriprise Financial, if a recession is avoided, considering the recent tariff dynamics, the current stock levels can provide attractive entry points for investors who plan to dollar-cost average in the volatility. Furthermore, the US economy and S&P 500 Index corporate profits are projected to grow, says the firm. While it remains difficult to project where the economy and corporate profits can move over the near-to-intermediate term as a result of current tariff policies, the US economy and corporate earnings are expected to remain positive in H1 2025, says Ameriprise Financial.
The corporate profit margins are at strong levels relative to history, which can support companies in navigating tariff worries and stabilize demand and profits, especially if these tariff impacts are temporary. On average, when the sentiment is significantly weak and there is increased uncertainty about policy, some clarity emerges. And with this, the stock performance tends to improve over the upcoming 6 to 12 months, says the investment management firm.
Amidst such trends, let us now have a look at the 10 Best Stocks to Buy and Hold for 20 Years.
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Our Methodology
To list the 10 Best Stocks to Buy and Hold for 20 Years, we sifted through several financial media reports to choose well-established and stable companies. After getting an extended list of the stocks, we shortlisted the ones that were the most popular among hedge funds, as of Q4 2024.
Why are we interested in the stocks that hedge funds pile into? The reason is simple: our research has shown that we can outperform the market by imitating the top stock picks of the best hedge funds. Our quarterly newsletter’s strategy selects 14 small-cap and large-cap stocks every quarter and has returned 373.4% since May 2014, beating its benchmark by 218 percentage points (see more details here).
10 Best Stocks to Buy and Hold For 20 Years
10. International Business Machines Corporation (NYSE:IBM)
Number of Hedge Fund Holders: 60
International Business Machines Corporation (NYSE:IBM) provides integrated solutions and services. Wamsi Mohan, an analyst at Bank of America Securities, reiterated a “Buy” rating on the company’s stock, retaining a price objective of $270.00. The analyst’s rating is backed by a combination of factors demonstrating International Business Machines Corporation (NYSE:IBM)’s resilience and growth potential in the tough macroeconomic environment. The analyst highlighted the company’s recurring revenue streams and the mission-critical nature of workloads, offering a buffer against the broader economic fluctuations. Overall, International Business Machines Corporation (NYSE:IBM)’s defensive portfolio, turnaround efforts as well as dividend yield support the analyst’s rating.
Over the next 20 years or so, the company’s growth is expected to be driven by the burgeoning AI market. International Business Machines Corporation (NYSE:IBM)’s extensive enterprise customer base offers a strong opportunity for AI monetization. Organic product innovation, together with strategic acquisitions, improves the company’s ability to provide cutting-edge AI solutions. With businesses adopting AI technologies, the company’s expertise can fuel significant growth and market share gains. Over the long term, the company’s competitive advantages, stemming from its switching costs and intangible assets, are expected to drive growth. Elsewhere, Stifel Nicolaus analyst David Grossman maintained a “Buy” rating on International Business Machines Corporation (NYSE:IBM)’s stock, setting a price objective of $290.00.
9. AT&T Inc. (NYSE:T)
Number of Hedge Fund Holders: 80
AT&T Inc. (NYSE:T) is engaged in providing telecommunications and technology services. The company’s competitive advantages stem from its leading market position, investments in fiber infrastructure and 5G, and brand equity. Furthermore, it can bundle fiber and wireless services, which can also provide it with a competitive edge in the long term. Matthew Griffiths, a Bank of America Securities analyst, maintained a “Buy” rating on the company’s stock, and the associated price target remained same at $28.00. The rating was backed by a combination of factors demonstrating AT&T Inc. (NYSE:T)’s healthy financial position and strategic direction.
The analyst noted the company’s consistent market strategy, which leads to predictable operational and financial outcomes. Amidst the potential disruptions from trade and tariff issues, AT&T Inc. (NYSE:T)’s business is expected to remain resilient, says the analyst. Given the importance of smartphones, home internet service, and wireless service, AT&T Inc. (NYSE:T) remains one of the top picks that can grow over the next 2-3 decades. Over the long run, mobile data usage is expected to rise. Through continuous investments in the network, the company remains well-placed to increase its revenue and FCF over the next few decades.
TCW Funds, an investment management company, released its Q3 2024 investor letter. Here is what the fund said:
“AT&T Inc. (NYSE:T), based in Dallas, TX, is a nationwide provider of voice, video, and data communications services to businesses and consumers in the wired, wireless, and broadband. At initiation, the stock had a $141 billion market capitalization and met all five valuation factors with an above market dividend yield of 5.6%. From a sustainability prism, the company completed its commitment to invest $2 billion by the end of 2023 to help bridge the digital divide. AT&T is working on enabling low-income households to access to low-cost broadband services through its Access service plan as well as reaching out to more rural communities and Tribal lands where internet access remains a challenge. It is nearly 85% the way to providing one million people in need with digital resources through AT&T Connected Learning® with the goal to be reached by the end of 2025. In 2020, the company announced that it is committed to be carbon neutral by 2035 with zero carbon emission across all operations. It is deploying Smart Climate Solutions – through efforts like its Connected Climate Initiative – that will help enable its business customers to reduce their emissions as well. The company’s goal is to help collectively reduce its emissions by one billion metric tons – a gigaton – by 2035, compared to 2018 levels. The primary catalysts are new/strong management and restructuring. John Stankey was appointed CEO in July 2020 and he is committed to refocusing the company and improving its financial performance. The company combined its WarnerMedia operation with Discovery during 1Q:22 which eliminated AT&T’s exposure to the rapidly evolving media industry and refocused its core telecommunication business thus eliminating a major drag on profitability and the company’s balance sheet by reducing long-term debt from a peak $176 billion during 2020 to $142 billion at the end of June 2024 quarter. AT&T is moving aggressively to reduce cost and sell non-core assets such as its advertising platform Xander to Microsoft† which was accomplished during 2022. The company has redesigned its network to be software driven structure reducing the capital investment cycle in its national network – resulting in a network that is flexible with unrivaled speed and reliability – thus enhancing its nationwide position. By the end of 2023, it expanded its 5G network to reach more than 302 million people in nearly 24,500 cities and towns in the U.S. The company’s mid-band 5G+ network alone grew to cover more than 210 million people. AT&T is one of the largest investors in digital infrastructure in the U.S. Over the five years ending 2023, the company invested nearly $150 billion primarily in its wireless, fiber optics, and wireline networks. The extensive restructuring and refocusing of AT&T on its core business should result in improved earnings and cash flow while at the same time reducing uncertainty for shareholders.”
8. NextEra Energy, Inc. (NYSE:NEE)
Number of Hedge Fund Holders: 84
NextEra Energy, Inc. (NYSE:NEE) is engaged in generating, transmitting, distributing, and selling electric power to retail and wholesale customers. Morgan Stanley analyst David Arcaro maintained a “Buy” rating on the company’s stock, setting a price objective of $95.00. The analyst’s rating is backed by a combination of factors demonstrating NextEra Energy, Inc. (NYSE:NEE)’s strategic positioning and capabilities in the dynamic energy market. The company’s extensive expertise and infrastructure throughout renewables, gas, and nuclear energy, together with its strong development pipeline, place it at the forefront of addressing the increased power demand.
NextEra Energy, Inc. (NYSE:NEE) expects a 55% jump in power demand over the upcoming 20 years as compared to the prior two decades, reported Reuters, while citing CEO John Ketchum’s viewpoints. As per Arcaro, the company’s focus on renewable energy, which has been regarded as the most scalable and cost-effective solution, remains in line with the broader industry’s pivot towards sustainable energy sources. NextEra Energy, Inc. (NYSE:NEE)’s capability to leverage advanced technology and data analytics across operations further improves its competitive edge.
Madison Investments, an investment advisor, released its Q3 2024 investor letter. Here is what the fund said:
“The top contributors in the quarter were NextEra Energy, Inc. (NYSE:NEE), Oracle Corporation, Progressive Corporation, Equifax Inc., and United Healthcare. NextEra has continued to perform well given its strong position in the renewable energy space, increasing demand for power, its transmission capabilities, as well as a tailwind from lower interest rates.”
7. Costco Wholesale Corporation (NASDAQ:COST)
Number of Hedge Fund Holders: 96
Costco Wholesale Corporation (NASDAQ:COST) is engaged in the operation of membership warehouses. Analyst Zhihan Ma of Bernstein is optimistic about the company. This optimism stems from a combination of factors demonstrating the company’s strong market position and growth potential. As per the analyst, Costco Wholesale Corporation (NASDAQ:COST) is a high-quality company possessing numerous opportunities for global warehouse expansion, which suggests a long-term growth trajectory.
Furthermore, Costco Wholesale Corporation (NASDAQ:COST)’s business model, demonstrated by limited SKUs and a treasure hunt approach, offers the company significant bargaining power and flexibility when it comes to adapting to changes in tariffs, added Ma. Costco Wholesale Corporation (NASDAQ:COST)’s membership trends are robust, with healthy renewal rates hinting at a loyal customer base. As of Q2 2025, the company reported a worldwide membership renewal rate of 90.5%. Also, Morningstar believes that the company has a unique edge because of its loyal membership base, impressive scale, and meticulous cost management. Therefore, over the next 2-3 decades, the company’s membership-based business model and high-quality products at low prices are expected to provide it with a competitive edge.
Parnassus Investments, an investment management company, released its Q2 2024 investor letter. Here is what the fund said:
“Costco Wholesale Corporation (NASDAQ:COST) posted strong results for the third quarter of fiscal 2024, with a robust increase in net sales and strength in both U.S. and international markets. Bucking the trend of weakening demand for discretionary items that has pressured many other retailers, Costco reported growth in nonfood sales.”
6. The Walt Disney Company (NYSE:DIS)
Number of Hedge Fund Holders: 108
The Walt Disney Company (NYSE:DIS) operates as an entertainment company. Laurent Yoon from Bernstein reiterated a “Buy” rating on the company’s stock, setting the price objective of $120.00. The Walt Disney Company (NYSE:DIS) continues to possess a strong position in the broader media and entertainment sector, while its streaming business remains a strong contributor to the growth prospects. Furthermore, the company’s investment in Epic Games offers healthy exposure to the overall gaming industry. The company’s stock is regarded as a promising investment opportunity, while its strategic investments and strong content offerings can fuel its performance over the long term.
Over the next 2-3 decades, The Walt Disney Company (NYSE:DIS)’s growth trajectory is expected to be driven by its intangible assets, consisting of IP. Furthermore, the company’s robust brand recognition and entertainment subsidiaries are likely to support. Notably, Amanda Tan, an analyst from DBS, opines that The Walt Disney Company (NYSE:DIS)’s IP portfolio happens to be a strong asset, resulting in a synergistic cycle fuelling its diverse business segments, including theme parks and resorts, which, in turn, offer a steady revenue stream. Elsewhere, BofA Securities analysts are also optimistic about the company. The Walt Disney Company (NYSE:DIS)’s emphasis on maintaining strong demand for its products and services, together with the advertising strength and ARPU growth potential in the streaming services, is regarded as the critical driver for the optimistic outlook.
5. Apple Inc. (NASDAQ:AAPL)
Number of Hedge Fund Holders: 166
Morgan Stanley reaffirmed an “Overweight” rating and a price objective of $220.00 on Apple Inc. (NASDAQ:AAPL)’s stock. Morgan Stanley opines that, looking beyond the current tariff uncertainties, the company’s advancements in software and hardware can accelerate the device replacement cycles and develop new opportunities for garnering service revenue. Such factors contribute to the firm’s optimistic outlook on Apple Inc. (NASDAQ:AAPL)’s stock. Wamsi Mohan, an analyst from Bank of America Securities, reiterated a “Buy” rating on the company’s stock. This analyst’s rating is backed by a combination of factors, which include the recent decline in the company’s stock price.
Notably, the stock has witnessed a fall of over ~17% on a YTD basis (through the close of April 21). As per the analyst, Apple Inc. (NASDAQ:AAPL)’s stable cash flows and earnings resiliency, together with its potential benefits stemming from AI advancements, aid the analyst’s rating. Amidst geopolitical worries and tariff risks, the company possesses strategies to mitigate such risks, like diversification of the supply chain and adjustment of pricing strategies. Over the next 2-3 decades, Apple Inc. (NASDAQ:AAPL)’s growth trajectory is expected to be driven by brand loyalty and switching costs. The company is known for its sticky ecosystem, therefore, its loyal customers are expected to continue to use iOS devices over the coming years.
Columbia Threadneedle Investments, an investment management company, published its Q4 2024 investor letter. Here is what the fund said:
“The fund maintained a position in Apple Inc. (NASDAQ:AAPL) throughout the quarter through the release of the company’s new iPhone 16 in September. Company leaders were excited about the release of the new model, as this is the first model that will feature enhanced AI capabilities through the Apple Intelligence features. Sales for the first few weeks in October and November trailed behind year over year sales from the iPhone 15, as availability of Apple Intelligence was not compatible with all iPhone models. Apple announced a partnership with OpenAI that has allowed the integration of ChatGPT into the Apple ecosystem, separate from the core Apple Intelligence features. This partnership highlights continued progress from Apple to introduce AI capabilities into its products and we expect the iPhone 17 to have even more expansive AI capabilities, increasing potential demand for the new model that is on track to be released in 2025.”
4. Visa Inc. (NYSE:V)
Number of Hedge Fund Holders: 181
Visa Inc. (NYSE:V) operates as a payment technology company. Bryan Bergin, a TD Cowen analyst, is optimistic about the company’s growth prospects. The analyst has lauded the company’s leadership in the consumer payments sector, hinting at the opportunities for further market penetration as well as higher engagement with the help of digital payments. Furthermore, Visa Inc. (NYSE:V)’s expansion into new business flows, as well as its strategic approach to M&As, bolsters the potential for sustainable growth. Over the upcoming 2 decades, the company’s growth is expected to stem from its scale, brand recognition, technology, and network effects. William Blair analyst Andrew Jeffrey is also optimistic about the company’s outlook.
As per the analyst, Visa Inc. (NYSE:V)’s transition from a consumer-payments company to a diversified platform with emphasis on value-added services and new payment flows is regarded as a critical growth enabler for its revenues. This growth is expected to stem from strong internal execution and investments in technology, which can improve its financial performance, mainly in terms of its adjusted EPS growth. Furthermore, Visa Inc. (NYSE:V)’s core payments business tends to benefit from the ongoing shift to electronic payments and technological advancements such as tokens and contactless payments, says the analyst.
Wedgewood Partners, an investment management company, released Q1 2025 investor letter. Here is what the fund said:
“Visa Inc. (NYSE:V) was a top contributor to portfolio performance during the quarter. The Company reported +10% revenue growth and +14% adjusted earnings per share growth, driven by strong cross-border payment volume growth of +16%. The absolute payment transactions and volumes that Visa handles across the globe are staggering: $13.4 trillion in volume on 240 billion transactions during 2024. Despite this massive size, there continues to be large, untapped addressable markets persist, particularly in cash and checks still in use to the tune of, believe it or not, of $11 trillion. At the heart of this activity are traditional banks that issue Visa-branded cards. However, increasingly popular forms of payments such as peer-to-peer, business-to-consumer, and even business-to-business are driving Visa’s volumes beyond traditional consumer payments. There continues to be ample room for Visa to expands its network value proposition and grow at attractive rate years to come.”
3. Alphabet Inc. (NASDAQ:GOOGL)
Number of Hedge Fund Holders: 234
Morningstar gave a wide moat rating on Alphabet Inc. (NASDAQ:GOOGL), which stems from its intangible assets, network effect, cost advantage, and customer switching costs. As per the firm, Alphabet Inc. (NASDAQ:GOOGL)’s advertising business happens to be a cash-generating machine. Together with advertising, the company continues to make progress on diversifying cash generation, with Google Cloud and YouTube subscription sales regarded as additional FCF drivers, opines Morningstar. Over the next few decades, the company’s search business can continue to sustain its dominance in the broader industry.
Even Morningstar analyst Ahmed Khan lauded Alphabet Inc. (NASDAQ:GOOGL)’s search engine business, which tends to utilise significant amounts of data it garners to improve search results and the targeting of adverts. The analyst believes that it’s difficult to overstate the dominance of this business, even though there are potential threats such as AI search and Tik-Tok. Justin Post, an analyst from Bank of America Securities, has expressed optimism around the company’s stock. As per the analyst, Alphabet Inc. (NASDAQ:GOOGL)’s advancements in AI and strategic investments in AI-related technologies can result in new monetization opportunities. Also, the introduction of the Gemini app, as well as its emphasis on operational efficiency, aids its growth prospects.
2. Microsoft Corporation (NASDAQ:MSFT)
Number of Hedge Fund Holders: 317
Analyst Keith Weiss from Morgan Stanley maintained a “Buy” rating on Microsoft Corporation (NASDAQ:MSFT)’s stock and gave the price objective of $472.00. The analyst’s rating is backed by a combination of factors demonstrating the company’s long-term potential amidst current challenges. The company’s valuation demonstrates a positive risk-reward balance for investors focusing on long-term prospects, mainly in the era of GenAI, where Microsoft Corporation (NASDAQ:MSFT) is regarded as a leader. Elsewhere, analyst Mark Murphy from J.P. Morgan maintained a “Buy” rating on the company’s stock.
The rating was backed by a combination of factors demonstrating Microsoft Corporation (NASDAQ:MSFT)’s strategic positioning and growth potential. One of the critical reasons is its significant advancements in the security offerings. As per the analyst, such developments remain critical as they address the increasing worries related to the IT landscape, mainly in the context of AI, and also enhance Microsoft Corporation (NASDAQ:MSFT)’s capability to provide comprehensive security solutions throughout multi-cloud environments. Morningstar assigned a wide economic moat rating, which stems from the switching costs. Notably, the network effects and cost advantages have been tagged as secondary moat sources. The firm expects that Microsoft Corporation (NASDAQ:MSFT) is expected to earn returns in excess of its cost of capital over the upcoming 20 years. The company’s AI initiatives can create new revenue streams and improve the existing products throughout its portfolio, supporting its growth trajectory for the decades to come.
Fred Alger Management, an investment management company, released its Q1 2025 investor letter. Here is what the fund said:
“Microsoft Corporation (NASDAQ:MSFT) is a beneficiary of corporate America’s transformative digitization. The company operates through three segments: Productivity and Business Processes (Office365, LinkedIn, and Dynamics), Intelligent Cloud (Server Products and Cloud Services, Azure, and Enterprise Services), and More Personal Computing (Windows, Devices, Gaming, and Search). During the quarter, shares detracted from performance as Azure revenue growth missed analyst estimates, marking the third consecutive quarter of modest disappointment in this segment. However, AI-related sales growth exceeded expectations, accounting for 13% of Azure’s quarterly growth. Management also maintained their fiscal third quarter earnings guidance while highlighting improved operating profitability and lower tax rates. Despite the disappointing quarter, we remain confident in Microsoft’s ability to sustain its leadership position in AI.”
1. Amazon.com, Inc. (NASDAQ:AMZN)
Number of Hedge Fund Holders: 339
Morningstar has assigned a wide moat rating to Amazon.com, Inc. (NASDAQ:AMZN), which stems from network effects, intangible assets, cost advantages, and switching costs. As per the firm, the company continues to disrupt the traditional retail industry for over 2 decades while, at the same time, has been emerging as a frontrunner in infrastructure-as-a-service provider through Amazon Web Services. Traditional retailers continue to invest significantly in technology in a bid to keep pace. Morningstar believes that the pandemic has ramped up this change, and considering Amazon.com, Inc. (NASDAQ:AMZN)’s technological prowess, relationship with consumers, and huge scale, the company has widened its lead, which can lead to economic returns well in excess of the cost of capital for several years.
AI integration in AWS can result in new, high-value services that can help Amazon.com, Inc. (NASDAQ:AMZN) stand apart. With enterprises adopting AI technologies, AWS’ AI-focused offerings can fuel higher-margin revenue growth and bolster its market position. Collectively, these factors are expected to help Amazon.com, Inc. (NASDAQ:AMZN) sustain its growth trajectory over the next 2-3 decades. Fred Alger Management, an investment management company, released its Q1 2025 investor letter. Here is what the fund said:
“Amazon.com, Inc. (NASDAQ:AMZN) is a global technology company renowned for its expansive e-commerce platform, offering a vast array of products and services to consumers worldwide. Beyond online retail, Amazon generates revenue through its cloud computing division, Amazon Web Services (AWS), which provides scalable computing solutions to businesses and governments; subscription services like Amazon Prime, offering members benefits such as streaming content and expedited shipping; and advertising services that enable brands to reach targeted audiences on its platform. During the quarter, shares detracted from performance due to concerns surrounding U.S. President Donald Trump’s impending tariffs on imported goods, raising fears about increased operational costs and weaker consumer spending. Additionally, management’s lower-than expected fiscal first-quarter sales forecast and substantial planned investments—including a $100 billion commitment to AWS and AI infrastructure in 2025—further pressured sentiment regarding near term profitability. Despite the near-term share price weakness, we believe Amazon’s fundamentals remain strong given its diversified business model, continuous innovation, and dominant positions in high-growth areas like e-commerce and cloud computing.”
While we acknowledge the potential of AMZN as an investment, our conviction lies in the belief that some deeply undervalued AI stocks hold greater promise for delivering higher returns, and doing so within a shorter time frame. There is an AI stock that went up since the beginning of 2025, while popular AI stocks lost around 25%. If you are looking for a deeply undervalued AI stock that is more promising than AMZN but that trades at less than 5 times its earnings, check out our report about this cheapest AI stock.
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