We recently published a list of 10 Best Stocks to Buy Now For the Long Term. In this article, we are going to take a look at where Visa Inc. (NYSE:V) stands against other best stocks to buy now for the long term.
What’s Next for the Equity Markets?
The US equity markets have started to show signs of recovery after weeks of volatility due to the tariff situation. On March 21, J.P Morgan Management’s Global Investment Strategist, Alan Wyne released his market update noting that this was the first weekly gain after four weeks for the US equity markets. While highlighting the current market condition Wyne highlighted that this improvement follows the Federal Reserve’s decision to leave interest rates unchanged while revising growth forecasts downward and increasing near-term inflation expectations. The Fed has emphasized that tariff-related inflation is likely transitory. Futures markets anticipate two interest rate cuts this year, with a 50% chance of a third, sparking demand in Treasury markets. On the other hand, yields on the 2-year and 10-year Treasury notes dropped by 7 and 9 basis points, respectively. Moreover, European stocks have continued to outperform, supported by Germany’s new legislation exempting defense spending exceeding 1% of GDP from borrowing restrictions. Wyne suggests that this policy could unlock significant fiscal spending across the Eurozone. The Stoxx 50 index is up 0.2% for the week and has gained 11% year-to-date.
While the S&P 500 is hovering near correction territory, marking five years since its COVID-19 drawdown. Wyne noted that the risks appear evenly distributed between bullish and bearish outlooks. On one hand, the bears argue that softer economic data and rising consumer inflation expectations could worsen with tariff escalations, potentially leading to stagflation. On the other hand, bulls counter that weak sentiment data does not necessarily reflect hard economic indicators such as employment and retail sales, which remain robust. Wyne highlighted that bulls point out that long-term inflation expectations are still anchored near the Fed’s target, mitigating risks of a wage spiral. He pointed out that historically speaking, investing during sentiment troughs has yielded strong returns in subsequent months.
Lastly, closing his market outlook with some investment advice, Wyne suggests that balancing risks by maintaining strategic asset allocation might be a viable strategy. He added that investors should use equities for long-term capital appreciation and fixed income for hedging during slowdowns. In addition, tactical adjustments can help capitalize on emerging opportunities while adding resilience through assets like gold and infrastructure investments. Wyne stressed that despite market volatility since the COVID-19 drawdown, the S&P 500 has risen over 150%, which underscores the importance of staying invested through uncertainties.
Our Methodology
To curate the list of the 10 best stocks to buy now for the long term we reviewed financial media reports and blue chip ETFs. From these sources, we picked stocks from multiple sectors including financials, energy, technology, consumer staples, and more. We finally selected stocks with a history of stable operations. Additionally, we checked their 10-year revenue growth rates and only considered companies with a growth rate of at least 7%. The list is ranked in ascending order of the number of hedge funds holding each stock, sourced from Insider Monkey’s Q4 2024 database.
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).
A close-up of a credit card being swiped on a payment terminal, reflecting the company’s payments technology.
Visa Inc. (NYSE:V)
10-Year Sales Growth: 11.03%
Number of Hedge Fund Holders: 181
Visa Inc. (NYSE:V) is a global payments technology company that facilitates digital payments and money movement across over 200 countries and territories. It operates primarily through its advanced transaction processing network, called VisaNet, which handles authorization, clearing, and settlement of payment transactions. On February 24, Analyst Andrew Jeffrey from William Blair reiterated a Buy rating on the stock noting that he likes the strategic transformation and market leadership of the company.
Visa Inc. (NYSE:V) is evolving from a consumer payments company to a diversified platform, focusing on value-added services and new payment flows. This transition is projected to drive revenue growth of 9%-12%. Moreover, approximately 70% of the company’s revenue comes from its core payments business, which benefits from the ongoing shift to electronic payments and advancements like tokenization and contactless payments. This segment has shown strong growth, with its global consumer payments volume outpacing consumer spending growth. Lastly, the company is also making significant investments in technology that are expected to improve financial performance, particularly adjusted EPS growth. It is one of the best stocks to buy for long term.
Meridian Hedged Equity Fund stated the following regarding Visa Inc. (NYSE:V) in its Q4 2024 investor letter:
“Visa Inc. (NYSE:V) is the world’s largest retail electronic payments network. We hold Visa in the portfolio because of its formidable competitive moat, built on network effects spanning billions of cards and millions of merchants globally. The company continues to benefit from the secular shift toward electronic payments while expanding its portfolio to include high-growth adjacent offerings. While U.S. market penetration is mature, international markets—particularly in emerging economies, where cash usage remains prevalent— offer significant growth opportunities. Visa’s operating model demonstrates strong leverage, with incremental revenue efficiently flowing to the bottom line. This quarter, Visa outperformed expectations across key metrics, with payment volumes and transaction growth proving resilient despite macro uncertainties. Looking ahead, we anticipate continued momentum into fiscal 2025, driven by the ongoing transition to digital payments, international expansion, and the scaling of newer business lines.”
Overall, V ranks 3rd on our list of best stocks to buy now for the long term. While we acknowledge the potential of V as an investment, our conviction lies in the belief that AI stocks hold greater promise for delivering higher returns and doing so within a shorter time frame. If you are looking for an AI stock that is more promising than V but that trades at less than 5 times its earnings, check out our report about the cheapest AI stock.
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Disclosure: None. This article is originally published at Insider Monkey.