In this article, we will take a look at 5 stocks that will make you rich in 5-10 years. If you want to see some more of the stocks, go to 10 Stocks That Will Make You Rich In 5-10 years.
5. Tractor Supply Company (NASDAQ:TSCO)
Number of Hedge Fund Holders: 41
Tractor Supply Company (NASDAQ:TSCO) is a Brentwood, Tennessee-based provider of agriculture, home improvement, livestock, and pet care-related products through a network of retail stores.
Between 2012 and 2021, Tractor Supply Company (NASDAQ:TSCO) saw its revenue per store expand by 50% while the total number of stores rose by 85%. Furthermore, the company has also seen its dividend grow consistently over the last 13 years. The stock’s annual forward dividend yield stands at 1.78% as of November 8. Analysts believe that Tractor Supply Company (NASDAQ:TSCO) can be termed as one of the best long-term stocks due to the company’s quality of operations and the successful execution of targets.
In a research note issued on August 19, Brian Nagel at Oppenheimer gave Tractor Supply Company (NASDAQ:TSCO) stock an Outperform rating with a target price of $270. The proposed target price reflects a potential upside of over 37% from the closing price as of November 8. The analyst believes that the short-term weakness in share price gives an attractive opportunity to go long on Tractor Supply Company (NASDAQ:TSCO).
Wedgewood Partners shared its outlook on Tractor Supply Company (NASDAQ:TSCO) in its Q4 2021 investor letter. Here’s what the firm said:
“Tractor Supply contributed favorably to performance during the quarter. Demand from the Company’s niche, affluent rural customer base continues to surge in a post-COVID world with comparable store sales running over +40% higher compared to pre-pandemic (2019) levels. Tractor Supply is seeing growth across all channels, from its website to e-commerce that is fulfilled by its 2000-store fleet to regular in-store traffic. The Company is also managing inflation and supply chain disruptions extremely well, passing through nearly +7% of inflation on consumable goods and managing a quarterly inventory in-stock rate that was actually higher than pre-pandemic. Tractor Supply is an exceptional retailer, and we continue to hold it as a top position.”
4. Marriott International, Inc. (NASDAQ:MAR)
Number of Hedge Fund Holders: 46
Marriott International, Inc. (NASDAQ:MAR) is a Bethesda, Maryland-based operator of one of the biggest hotel chains globally. The company has over 8,000 properties and a portfolio of over 30 brands, such as Ritz-Carlton, Sheraton, and Westin in its portfolio.
On September 15, Stuart Gordon at Berenberg upgraded Marriott International, Inc. (NASDAQ:MAR) stock from a Hold to a Buy rating and also increased the target price from $165 to $185. The analyst is seeing rapid recovery in the lodging sector that is yet to be reflected in Marriott International, Inc.’s (NASDAQ:MAR) stock price. Gordon anticipates a strong increase in the company’s revenue per available room (RevPAR) in 2023 despite the possibility of a recession looming.
Marriott International, Inc. (NASDAQ:MAR) offers an annual payout of $1.20, translating into an annual forward dividend yield of 0.81% as of November 8. The company’s strong cost control and higher demand for services are expected to give a significant push to operational efficiency in the following years. These factors have led many to see Marriott International, Inc. (NASDAQ:MAR) as one of the best long-term stocks in the market currently.
In its Q1 2022 investor letter, Aristotle Capital Management presented its outlook on Marriott International, Inc. (NASDAQ:MAR). Here’s what the firm said:
“Marriott International outperformed in the first quarter following a better-than-expected earnings report for the company’s fourth quarter of 2021. During the pandemic, the company reduced expenses which improved operating leverage as revenue recovers. Expectations for travel in 2022 have improved as COVID cases have declined. The company has a strong pipeline of new hotels coming into the Marriott system. There are some indications that business-related travel is starting to recover.”
3. Dollar General Corporation (NYSE:DG)
Number of Hedge Fund Holders: 51
Dollar General Corporation (NYSE:DG) is a Goodlettsville, Tennessee-based discount retailer with over 18,000 stores across 47 states in the US. The company has established its stores in sub-urban and small towns where big box retailers like Walmart, Inc. (NYSE:WMT) are not present.
In a research note issued on September 16, Matthew Boss at JPMorgan increased the target price for Dollar General Corporation (NYSE:DG) from $287 to $294 and reiterated an Overweight rating on the stock. The target price reflects a potential upside of over 20% from the closing price as of November 8. Experts believe that Dollar General Corporation (NYSE:DG) is one of the few retailers that are in a strong position to experience top-line growth and margin expansion in the future as consumers shift focus from discretionary purchases to consumables owning to the macroeconomic environment. This makes the company one of the best long-term stocks to own now.
Analysts are bullish on Dollar General Corporation (NYSE:DG) in the long term, as the firm has shown a strong acceleration in sales over the last few years. The company observed an increase in revenue to $34.22 billion in 2021 from $23.47 billion in 2017. In addition, effective cost control is likely to help Dollar General Corporation (NYSE:DG) sustain its profitability margins.
Here’s what LRT Capital Management said about Dollar General Corporation (NYSE:DG) in its Q3 2021 investor letter:
“Executive Summary
At LRT Capital Management we are continuously searching the market for great investment opportunities. Our favorite finds are companies with moats and growth opportunities that justify a higher price than what the stock is trading for. One of our holdings (approximately 1.5% of our long exposure) is Dollar General (DG), so today, we wanted to tell you a bit about this great company.
Company Overview
Dollar General is a discount retailer with the largest brick-and-mortar presence in the United States by store count. The company’s largest concentration of stores can be found in the southern, southwestern, midwestern, and eastern parts of the United States.10 Dollar General was founded in 1939 by J.L. Turner, who originally named the company “J.L. Turner and Son, Wholesale”. As the name suggests, the company began its life as a wholesaler, but quickly turned to a retailer of general store goods. By the early 1950s, the company had annual sales of $2 million per year,12 which is the equivalent of $22.95 million in 2021 dollars when adjusted for inflation.
The first Dollar General store opened on June 1st, 1955 in Springfield Kentucky. The simple concept was that no item in the store would cost more than one dollar. The company changed its name to Dollar General Corporation in 1968 when Dollar General became publicly traded. At the time of its initial public offering, the business generated more than $40 million in annual sales. The company’s common stock was publicly traded from 1968 until July 2007, when it was taken private by KKR. The company went public again in November 2009, under the ticker DG.
Today, Dollar General is an evolved, and phenomenal business with more room for growth. Annual sales reached a record $33.7 billion in fiscal year 2021 after consecutively growing the top line for many years. The company’s main products are every-day necessities and consumables purchased by lower income consumers on tight budgets…”
2. RH (NYSE:RH)
Number of Hedge Fund Holders: 59
RH (NYSE:RH) is a California-based home furnishings designer and retailer with a presence in the US and Canada through its 70 locations. The company has the distinction of having Warren Buffett’s Berkshire Hathaway Inc (NYSE:BRK-B) as one of its leading investors.
Phillip Blee at William Blair resumed coverage on RH (NYSE:RH) stock with an Outperform rating on September 21. The analyst highlighted that the company reported a better-than-anticipated top line and bottom line for Q2. Furthermore, RH (NYSE:RH) has been able to capitalize on the changes in consumption trends in the last two years. There is a wide belief that RH (NYSE:RH) is in a position to experience sales and earnings growth in the long run.
Analysts think RH (NYSE:RH) is amongst the best long-term stocks due to its stable free cash flows and premium positioning in the industry. The company has a strong backlog and is also looking into tapping into a market opportunity of $20 to $25 billion globally through expansion plans in the next five years.
Here’s what Polen Capital said about RH (NYSE:RH) in its Q1 2022 investor letter:
“RH is a furniture store company with brand recognition and a unique business model. The company’s stock price fell sharply over the first three months of 2022 despite solid operating results, which resulted in what we believed to be an attractive opportunity to add to our position in the company. We are mindful that, on the margin, the company is certainly experiencing some early impact from record inflation and rising interest rates, and we feel comfortable in both the management team’s ability to navigate these challenges and the power of the company’s brand and its long-term potential.”
1. JD.com, Inc. (NASDAQ:JD)
Number of Hedge Fund Holders: 62
JD.com, Inc. (NASDAQ:JD) is a rising Chinese e-commerce entity that has invested the last ten years in developing a logistic infrastructure that ensures swift delivery across China.
The Beijing, China-based company controls the majority of its sales and does not operate on a marketplace model like the Jack Ma-led Alibaba Group Holding Limited (NYSE:BABA). This provides JD.com, Inc. (NASDAQ:JD) the opportunity to capture better margins and more control over the quality of its products. Although the Chinese economy is showing some signs of weakness, this is a short-term phenomenon expected to be resolved soon.
In the last five years, JD.com, Inc. (NASDAQ:JD) observed its revenue increase at a CAGR of 29.61%. The company is expected to continue seeing an expansion in sales with a CAGR of 11.6% in the next decade. Due to its strong growth prospects, JD.com, Inc. (NASDAQ:JD) is being termed as one of the best long-term stocks that investors should buy, with an outlook of five to 10 years to yield significant returns.
Coatue Management raised its stake in JD.com, Inc. (NASDAQ:JD) by 72% during Q2 2022.
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