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By Ian Bezek, InvestorPlace
These Nasdaq stocks to buy and hold have outstanding long-term track records and forward potential.
- Pepsico (PEP): It has delivered tremendous returns for long-term shareholders.
- Interactive Brokers (IBKR): It should benefit from industry consolidation and higher interest rates.
- CSX Corporation (CSX): Railroads have returned to prominence in recent years.
- Monster Beverage (MNST): It’s produced electrifying returns for long-term shareholders.
- JD.com (JD): The worst appears to be over for Chinese e-commerce stocks.
- Idexx Laboratories (IDXX): Higher pet spending will reignite the bull run in shares.
- Intel (INTC): Don’t write off the semiconductor giant yet.
Read More: How to be a smart investor when the stock market is confusing
After watching the Nasdaq lose roughly a third of its value in 2022, investors might rightly be wary of that particular stock exchange. However, the truth is that there are still plenty of Nasdaq stocks that have created tremendous wealth for long-term investors. Today, we’ll be looking at a few of these Nasdaq stocks to buy and hold.
It’s easy to think of some dominant tech companies that have put up stellar returns over the long haul despite the periodic busts in that sector. And those have certainly been great additions to a portfolio. However, there’s much more to the Nasdaq than just pure technology companies.
In fact, an investor constructing a long-term portfolio of Nasdaq stocks to buy and hold can find dominant companies across a variety of industries. The seven companies below are among the best the Nasdaq has to offer for investors looking to amass a steadily increasing fortune.
| PEP | PepsiCo | $181.10 |
| IBKR | Interactive Brokers | $73.65 |
| CSX | CSX Corporation | $32.20 |
| MNST | Monster Beverage | $102.43 |
| JD | JD.com | $64.30 |
| IDXX | IDEXX Laboratories | $447.77 |
| INTC | Intel | $28.73 |
Pepsico (PEP)
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Pepsico (NASDAQ:PEP) is one of the safest and most reliable blue-chip stocks listed on the Nasdaq.
Pepsico is rarely a high-flying stock in any given year. Over time, however, the company’s shares have steadily marched upward, with an average annual return of nearly 12% over the past decade. The company is also a dividend machine. It has increased its annual dividend for 50 years in a row, putting it among the elite Dividend Kings.
Some investors may scoff at the company’s forward P/E ratio of 25. At first glance, that might seem high for a company that rarely grows earnings by more than a high-single-digit annual rate.
However, the consistency of that earnings growth makes PEP stock worth a lot more than many other seemingly comparable firms. As this bear market has shown, there is great value in a company whose earnings are virtually immune to recessions and economic uncertainty.
Interactive Brokers (IBKR)
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Interactive Brokers (NASDAQ:IBKR) is a discount brokerage firm. It serves a wide range of customers from retail traders up through hedge funds and registered advisors.
Interactive Brokers has a global reach, offering services to investors in dozens of countries. It also offers a vast array of tradable markets, including Europe, Asia and even emerging markets such as Mexico, which are all available within a single trading account.
The obvious appeal to IBKR stock today is rising interest rates. The company earns a substantial portion of its revenue from its margin loans to customers. The rate on its margin loans has surged amid the Federal Reserve’s continued rate hikes. In addition, there may be opportunities to earn additional returns on their own securities portfolios.
Interactive Brokers is more than just a near-term interest rate play, though. Founder Thomas Peterffy is a visionary within the brokerage services industry and has built his company to thrive on a generational timeframe. The company’s relentless focus on low costs and best-in-industry trading execution has led to a loyal following among professional traders.
As brokerages continue to consolidate, Interactive should assume a leading position.
Read More: 4 Ways to Tax-Proof Your Investment Portfolio
CSX Corporation (CSX)
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Many people probably don’t know that railroad operator CSX Corporation (NASDAQ:CSX) is a Nasdaq-listed company. While it may seem odd at first glance, it makes sense.
Railroads were the original American growth stocks. American railroad booms led to several bouts of market euphoria in the 1800s. Within a capitalist economy, though, every successful new technology eventually becomes a commodity product over a long enough period of time. What was once new and novel becomes routine and less profitable.
However, after a decades-long slump for railroads, the old innovators have learned some new tricks. New techniques to improve efficiency and automate functions have made railroads much more competitive against other modes of transportation. Higher fuel prices have also helped shift the balance. Trains can move far more goods per unit of fuel consumed as opposed to highway transport.
In an era of inflation and potential energy shortfalls, trains are enjoying another golden age.
Monster Beverage (MNST)
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Monster Beverage (NASDAQ:MNST) has been one of the best-performing stocks of the modern era, with shares up around 64,000% since the 1980s. As recently as 2004, MNST stock traded for just 50 cents per share. They now go for over $100 apiece.
The company has given a jolt to investors and consumers alike. As Warren Buffett proved with his Coca-Cola (NYSE:KO) investment, the combination of sugar and caffeine is a tremendous one. Monster’s energy drinks have proven to be a habit-forming product that a certain group of consumers simply love, regardless of the price. And Management has proved adept at launching new flavors and products to keep growing its market share.
MNST stock isn’t particularly cheap today, but long-term investors have been rewarded for holding onto shares regardless of valuation thanks to the firm’s steady and robust growth trajectory.
JD.com (JD)
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Chinese stocks have had a difficult couple of years facing a one-two punch from extended Covid-19 restrictions and increasing trade tensions with other countries. They slumped to multiyear lows in 2022 on concerns that American regulators may delist many Chinese firms.
However, the tide has started to turn in recent months. With Covid-19 restrictions easing, many Chinese equities have seen a sharp recovery, led by internet companies. Despite the political jitters, China still has more than a billion people and many of them are going to shop online. JD.com (NASDAQ:JD) is one of the country’s most promising e-commerce services.
JD has built a solid reputation for two main reasons. One, the company has long taken a hard stance on counterfeit and low-quality merchandise, giving it a big edge with consumers who value quality. Second, JD’s heavy investments in logistics paid off in a big way during the lockdowns as it has had more flexibility with supply chains and product deliveries.
JD stock is down just 6% over the past year thanks to a 94% rally off its October low. However, shares remain roughly 40% below their 2021 high. With shares now going for less than 20 times forward earnings, this fast-growing e-commerce company is set for a favorable 2023 and beyond.
Idexx Laboratories (IDXX)
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Idexx Laboratories (NASDAQ:IDXX) is a life sciences firm devoted to animal health, including pets and commercial animals such as livestock. The company sells veterinarians testing and screening processes to use at their offices. It also has a remote service where pet owners and vets can send test samples to Idexx-affiliated labs for processing. Finally, Idexx offers cloud-based software that helps veterinarians manage and run their practices.
IDXX stock has been an outstanding long-term winner, with shares rallying more than 1,700% between 2012 and 2021. Shares subsequently fell more than 55% from their 2021 high to their 2022 low, as investors feared a slowdown in pet spending following a pandemic surge.
However, the longer-term trend is unlikely to change. Americans have been adopting a greater number of pets and treating them more and more like children. Morgan Stanley forecasts pet spending will increase 8% a year through 2030, which bodes very well for Idexx and its shareholders.
Intel (INTC)
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Intel (NASDAQ:INTC) is the longtime leader in semiconductors for the personal computing and server markets. The firm has a storied history and has delivered tremendous returns for investors that have held shares over the decades.
Recent returns have been lackluster though as Intel lost significant market share to Advanced Micro Devices (NASDAQ:AMD) over the past couple of years. Meanwhile, the 2020-21 boom in computing sales has turned into a major bust as we head into 2023.
That said, Intel’s long-term outlook remains bright. In 2021, the company spent more than $15 billion on research and development, giving it a strong technological and intellectual property advantage.
Intel is also investing heavily in new semiconductor fabrication facilities in Arizona and Ohio. These will be subsidized thanks to the Biden administration’s CHIPs Act, which gives significant support to domestic chip manufacturing facilities. In an increasingly uncertain world, Intel’s world-class domestic facilities will give it a strong operating position throughout the 2020s.
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