$1,000 is a solid amount for many investors. and, S&P 500 With 20% less than last year, now is the perfect time to trade in the market.Let’s discuss why Amazon (AMZN 3.56%) When Philip Morris International (afternoon 2.65%) It can greatly increase your money in the long run.
Amazon.co.jp
Like many big tech companies, Amazon is reeling from a grim combination of rising interest rates, inflation, and the possibility of a near-term recession. But while these headwinds caused the stock to lose about half of its value last year, the long-term thesis remains the same.
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Amazon bets on global e-commerce growth and cloud computing — 2 long-term megatrends There are no signs of an imminent reversal. In the United States and other developed regions, demographic changes will drive adoption of online shopping. In developing regions such as Africa and Latin America (where Amazon plans to expand significantly this year), technological advances can bring previously untapped markets online.
With 300 million active users, Amazon’s massive scale is well-positioned to capture the growth of the industry. More users attract more merchants and more competition, improving the so-called quality of the platform. network effectAmazon’s size also allows it to expand into related industries such as digital advertising, and has great synergies with its shopping-motivated user base.
With a future price/earnings ratio (P/E) of 41, Amazon is trading significantly higher than the S&P 500 average of around 20. Get over your immediate challenges.
Philip Morris International
Defensive investors shouldn’t turn to tobacco giant Philip Morris International amid growing fears of a recession. Not only is this tobacco maker geographically diversified, but its rapid shift to lower-risk tobacco products has the potential to overwhelm its competitors.
The tobacco industry is recession-proof because its products are addictive. People tend to stick with them. even in bad timesThe downside of this for investors is that the industry is heavily regulated. US version of Philip Morris, Altria GroupI learned this the hard way when I was a partially owned vaping startup Joule Institute After a series of troubles, domestic sales of the product were prohibited. (This decision is currently being appealed by Juul.)
Philip Morris is protected from such risks due to its highly diversified geography with revenue streams spanning Europe, Asia, Africa and Latin America. No single reporting segment accounts for more than his quarter of the company’s total revenue.
The company has also completely stayed away from tobacco. By 2025, he plans to get 50% of his revenue from safer sources, such as heated tobacco units that release nicotine by heating rather than burning, to release less harmful chemicals. doing.
With a P/E multiple of 17, Philip Morris is valued slightly below the market average. A 5% dividend yield is the icing on the cake for investors.
Which stock is best for you?
Both Amazon and Phillip Morris offer investors a great opportunity to turn their $1,000 investment into much more in the long run. However, they serve different investment strategies.
Amazon is a growth stock because of its strong moat in expanding industries such as e-commerce and cloud computing. Philip Morris is ideal for investors who prioritize safety and reliable dividend income over rising stock prices.
John Mackey, former CEO of Whole Foods Market, an Amazon subsidiary, is a member of The Motley Fool’s board of directors. Will Ebiefung has no positions in any of the stocks mentioned. The Motley Fool has a position on and recommends Amazon.com. The Motley Fool recommends Philip Morris International. The Motley Fool’s U.S. headquarters has a disclosure policy.
