Warning! The stock market will be closing at the end of next week and will re-open promptly in 2024.
Get ready and choose well! – The Management.
What if this was flashed on your online brokerage website? You have one week to decide which stocks to hold, as well as which to sell off. You get any dividends the companies may pay, but as for trading, you're locked in for a decade.
That would definitely make you feel more like a sober investor than a cowboy trader. No quick flips, just a chance to cash in your chips ten years from now.
Billionaire investor Warren Buffett tells investors to pick stocks as if they had to hold them for ten years. What stocks would you choose? The company would need:
1) to be able to survive for at least ten years (strong balance sheet and manageable debt).
2) steady and growing earnings.
3) strong management performance to maximise growth and profits.
Here are two stocks I consider rock-solid growers that you probably would be comfortable to hold for a decade, if not longer.
SEEK Limited (ASX: SEK)
Already the market leader in job placement ads with its seek.com.au website, the next step is to go beyond Australia and tap into the job markets of highly populated countries in Asia and beyond. Its overseas businesses in such places as Malaysia, Singapore, Indonesia and the Philippines are achieving a higher earnings growth rate than its Australian segment.
Its SEEK Education training segment is also expanding well to support the company's regularly high overall earnings growth rate (usually around 20% annually). By investing in market-leading job search websites in developing countries, it can replicate its success and have the same competitive advantages that come with being the number one site for job placement.
Amcor Limited (ASX: AMC) is in the packaging industry, which may not sound too exciting, but its products- for beverages, food, healthcare and personal care items- are used and consumed on a daily basis by many companies. As the Australian market leader and a global packaging company, it has deep ties to many different industries, which makes it a stable business. It also is active in acquisitions to expand its footprint and buy out competitors.
Over the past 10 years, it has given investors a total shareholder return of 12% and earnings have steadily risen in the last five years as well. Like SEEK, it is expanding into emerging markets where it will have a technological advantage and can more easily establish itself as a leading packaging business. The company will be around for a long time, so it's a good holding for a long-term portfolio.
