A longer time horizon for building wealth allows more time for companies to work on your behalf as a shareholder. Here are a number of stocks that our free-site writers have bought and held for at least the past half-decade!
Barclays
What it does: Barclays offers both traditional private banking services as well as catering for international, institutional corporate clients.
By Andrew Mackie. I bought my first tranche of Barclays (LSE: BARC) in early 2020, during the Covid crash. For a couple of years the stock did absolutely nothing. But then, off the back of rising interest rates, net interest income began to surge and it has become one of the best performers in my portfolio. Patience really can be an investors best friend.
Of course, talk of tariffs and trade wars have reversed the positive momentum. Nevertheless I have remained invested. The main reason is because of the all-important structural hedge. Most private investors believe that a falling interest rate environment would be bad for net interest income. But that is simply not true.
During its FY24 results, it stated that £9.1bn of gross income over the next 2 years is already locked in, regardless of where interest rates go. Of course, should a recession ensue that won’t stop its share price falling, as delinquencies increase. But then again, back in 2023 many expected a recession, which never happened. If I had have sold out then, I would have lost out on the stock’s most explosive moves.
Andrew Mackie owns shares in Barclays.
IG Group
What it does: Financial trading platform IG Group offers trading products such as CFDs, spread betting and options.
By Roland Head. IG Group (LSE: IGG) is one of the largest and oldest holdings in my share portfolio. While the stock suffers periodic ups and downs, high profit margins and a reliable dividend mean I’ve always been happy to continue holding.
One aspect of this business I especially like is that when markets are volatile and uncertain, IG’s clients start trading more. This generates higher revenue (and profits) for the business.
IG is the market leader in CFDs, but one concern for me is that the group’s market share has weakened in recent years as competition has intensified.
However, higher interest rates have provided a big boost to profits and new management are taking steps to update and expand the group’s offering.
IG shares are close to all-time highs at the moment, but recent profit growth means I think the stock remains reasonably priced, on around 10 times forecast earnings. There’s also a useful 4.7% dividend yield.
Roland Head owns shares in IG Group.
MercadoLibre
What it does: MercadoLibre operates a leading e-commerce marketplace across 19 Latin American countries, as well as a digital payments platform.
By Ben McPoland. One stock that I’ve owned for more than five years is MercadoLibre (NASDAQ: MELI). The e-commerce powerhouse has grown its revenue from $2.3bn in 2019 to $20.8bn last year – an increase of 800%!
This has seen the share price rise by more than 200%, making MercadoLibre Latin America’s most valuable publicly listed company in the process.
While the firm now has over 100m e-commerce customers, it is targeting 300m over the long term (from a population of 600m+). But the opportunity in digital payments and banking could be even larger, as the region still has a huge unbanked/underbanked population.
This rapid foray into digital lending does present risks though, especially if key markets like Brazil and Mexico enter a recession. In this situation, the firm could experience rising default rates and credit losses.
Looking ahead though, shopping and payments on smartphones are both expected to continue rising in Latin America. MercadoLibre’s revenue is tipped to reach $38bn in 2027, up from $25bn this year, while earnings per share are forecast to almost double.
I have no plans to sell.
Ben McPoland owns shares of MercadoLibre.
Rightmove
What it does: Rightmove is an internet business that operates a UK property search portal.
By Edward Sheldon, CFA. I bought Rightmove (LSE: RMV) shares in late 2018. And they’ve been a solid investment for me.
I originally bought in at a share price of 439p. As I write this, however, the shares are trading for 697p – 59% higher. That translates to a return of about 8% per year. Add in dividends from the company and my return has been closer to 10% per year.
Looking ahead, I remain optimistic about the stock’s potential. Rightmove is a very well known brand in the UK, so estate agents can’t afford to ignore its platform (meaning the company has pricing power).
Meanwhile, the stock is attractively priced. Currently, the price-to-earnings (P/E) ratio is in the low 20s, which is not high for a highly-profitable internet company.
It’s worth pointing out that new competitors are continually popping up. And there’s a chance that these companies could capture market share.
I remain optimistic that Rightmove will keep winning, however. When Britons want to search for a property, rightmove.co.uk is typically the first place they go.
Edward Sheldon owns shares in Rightmove
