Even reliable stocks can face declines at times. Buying shares at a lower price can be smart when you have strong confidence in a company’s future during such periods. Hesitating may result in missing out on the benefits of a recovery.
Here are two stocks expected to be relatively stable in the long run and currently available at discounted prices. If you’re looking for investments with potential for years of growth, it’s worth considering whether now is the right time to buy to avoid future regrets.
Pfizer
Pfizer’s (NYSE: PFE) stock has dropped 18% in the past year, but it hasn’t been this attractive since the early stages of its COVID-19 vaccine development in 2020. The pharmaceutical company’s short-term outlook may be bearish due to declining demand for its COVID-19 vaccine and antiviral pill, but its long-term strategy is taking shape, and investors stand to benefit.
Pfizer plans to launch new medicines from its pipeline over the next few years, targeting a compound annual growth rate of 6% in revenue through 2025. It also aims to acquire other companies to generate an additional $25 billion in annual revenue by 2030, resulting in an estimated 10% annual top-line growth from the end of 2025 through the decade.
So far this year, Pfizer has acquired the rights to acute migraine treatment and a drug for ulcerative colitis, Etrasimod. It also plans to purchase cancer medicine developer Seagen for $43 billion, with sales from Seagen’s existing medicines expected to contribute over $2 billion in revenue upon completion. By 2030, Pfizer anticipates Seagen’s pipeline to generate over $10 billion in annual revenue.
Buying shares now means investing in Pfizer before its stock price reflects this future revenue and growth potential. While there’s always the risk of unsuccessful commercialization of new medicines, Pfizer’s extensive pipeline increases its chances of long-term success.
Costco
Costco Wholesale’s (NASDAQ: COST) shares have dropped 16% since mid-April 2022; savvy investors recognize it as a prime candidate for buying on the dip due to its substantial long-term growth potential. Costco’s dip is attributed to its high valuation, with a price-to-earnings (P/E) multiple of 37 compared to the market’s average P/E near 22. However, this valuation is justifiable and unlikely to decrease significantly in the near future.
Over the last decade, Costco has consistently grown its quarterly net income by an average of 12.8% yearly, reaching $1.4 billion in its fiscal Q2 2023. Despite the pandemic and inflation challenges, the company has continued to thrive. In March, its sales increased by 0.5% yearly to $21.7 billion.
Costco’s ability to offer a wide range of essential goods like groceries, gasoline, clothing, and home appliances at competitive prices ensures its popularity among consumers, even during economic downturns. This positions the company for continued success in the long run.
Pfizer and Costco are resilient stocks that investors may consider purchasing during market dips. Their potential for long-term growth and the current discounted prices make them attractive investment options.
Pfizer’s focus on expanding its pipeline, strategic acquisitions, and anticipated future revenue from Seagen bode well for its growth prospects. On the other hand, Costco’s consistent growth in net income, adaptability during challenging economic conditions, and its wide range of competitively priced essential goods make it a reliable choice for investors.
Conducting thorough research and assessing your risk tolerance is crucial when considering any investment. By staying informed and considering these factors, you can make informed decisions that align with your investment goals and minimize the chances of regret down the line. Investing always carries inherent risks, and past performance does not guarantee future results.
