In this article, we will look at the 12 Best Stocks to Buy and Hold for the Long Term.
On June 2, State Street Global Advisors released its mid-year global market outlook for 2025. The firm remains confident in a soft-landing scenario despite recent and ongoing geopolitical and economic issues. The report highlighted that the most recent market volatility was caused by the US trade and tariff policies, however, the markets have now ingested the volatile period as tariff hikes have been paused for negotiations.
Regardless of the uncertainty, State Street Global maintained its base case outlook which indicates no US recession, steady growth across Europe, and global growth trends within the expected range. The report also noted the US equities have shown strong earnings in Q1 2025 as the S&P 500 earnings grew more than 12% year-over-year, with valuations remaining reasonable. The firm anticipates the US stocks to outperform significantly stated the trade tensions are eased.
Despite a positive outlook the firm advised to keep investments diversified across classes and regions such as equity, fixed income, gold, and cash.
With that let’s take a look at the 12 best stocks to buy and hold for the long term.
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Our Methodology
To curate the list of 12 best stocks to buy and hold for the long term we relied on reputable financial media sources. We aggregated a list of best stocks for long-term investment and then ranked them based on the number of hedge fund investors, sourced from Insider Monkey’s Q1 2025 database.
Why are we interested in the stocks that hedge funds pile into? The reason is simple: our research has shown that we can outperform the market by imitating the top stock picks of the best hedge funds. Our quarterly newsletter’s strategy selects 14 small-cap and large-cap stocks every quarter and has returned 373.4% since May 2014, beating its benchmark by 218 percentage points (see more details here).
12 Best Stocks to Buy and Hold for the Long Term
12. Axon Enterprise, Inc. (NASDAQ:AXON)
Number of Hedge Fund Holders: 61
Axon Enterprise, Inc. (NASDAQ:AXON) is one of the 12 Best Stocks to Buy and Hold for the Long Term. On June 8, analyst William Power of Robert W. Baird maintained a Buy rating on Axon Enterprise, Inc. (NASDAQ:AXON) with a price target of $800. The maintained bullish sentiment comes after President Donald Trump signed two major executive orders on June 6, aimed at significantly enhancing the commercial use of drones in the United States.
William Power noted, that the executive orders to enhance the commercial use of drones significantly improve the strategic position of Axon Enterprise, Inc. (NASDAQ:AXON). This becomes more relevant considering the company’s strategic partnership with Skydio to deliver scalable drones as first responders for public safety. Power believes the drone market is expected to grow significantly as regulations will allow more drone operations.
Additionally, Axon Enterprise, Inc. (NASDAQ:AXON) acquired Dedrone last year which also strengthens its capabilities in drone technology and provides its field importance. According to analyst Power, the drone and robotics industries are valued to be worth more than $20 billion, thereby presenting an opportunity for the company to deploy more DFR programs.
Axon Enterprise, Inc. (NASDAQ:AXON) is a global technology company focused on public safety. It manufactures and provides various products including TASER energy devices, body and in-car cameras, and cloud-based software for managing digital evidence.
11. Palantir Technologies Inc. (NASDAQ:PLTR)
Number of Hedge Fund Holders: 77
Palantir Technologies Inc. (NASDAQ:PLTR) is one of the 12 Best Stocks to Buy and Hold for the Long Term. On June 16, William Blair analyst Louie DiPalma maintained a Hold rating on Palantir Technologies Inc. (NASDAQ:PLTR) without a price target. The neutral rating is based on the recent contract awarded to OpenAI by the US Department of Defence (DoD), which is valued at $200 million and signals increased competition for Palantir.
Analyst Louie DiPalma noted that while the contract with DoD is a significant win for OpenAI it could impact the market position of Palantir Technologies Inc. (NASDAQ:PLTR), particularly if OpenAI starts expanding into areas traditionally dominated by the company. Moreover, he also finds the current valuation of the company to be quite high and unsustainable given the increased competition. Louie DiPalma acknowledged that Palantir Technologies Inc. (NASDAQ:PLTR) has been a leader in securing AI-related contracts with DoD, however, the evolving landscape presents a challenging environment to maintain this dominance.
Regardless of the neutral rating, the management of the company remains optimistic. The company posted encouraging results for the fiscal first quarter of 2025 on May 5. It grew its United States revenue by 55% year-over-year to reach $628 million, out of this government revenue accounted for $373 million, reflecting a 45% increase year-over-year. Notably, the company closed 139 deals valued at least $1 million and 31 deals valued at least $10 million.
Taking confidence from the quarterly highest US commercial total contract value of $810 million, Palantir Technologies Inc. (NASDAQ:PLTR) raised its full-year revenue guidance to between $3.890 billion and $3.902 billion.
10. Palo Alto Networks, Inc. (NASDAQ:PANW)
Number of Hedge Fund Holders: 77
Palo Alto Networks, Inc. (NASDAQ:PANW) is one of the 12 Best Stocks to Buy and Hold for the Long Term. The company released its Q3 2025 results on May 20. Palo Alto Networks, Inc. (NASDAQ:PANW) exceeded expectations with revenue at $2.29 billion topping estimates by $8.99 million, and EPS of $0.80 exceeded consensus by $0.03.
Palo Alto Networks, Inc. (NASDAQ:PANW) continues to execute on its platformization strategy, thereby moving away from selling isolated security products and instead offering integrated, cloud-based security platforms. As a result of this strategy, the company achieved 5 billion in next-generation security (NGS) annual recurring revenue (ARR), up 34% year-over-year. Moreover, most of the growth came from AI-powered products like XSIAM, SASE, and software firewalls.
On May 21, Malik Ahmed Khan, equity analyst at Morningstar appeared on Yahoo Finance to talk about his investment perspective on the company. Palo Alto Networks, Inc. (NASDAQ:PANW) has been a leader in cybersecurity for several years, said Khan. He noted that Morningstar has been recommending the company to investors for catalyzing investments. He also highlighted the platformization strategy of the company as a move to expand beyond traditional firewall business and into the networking and cloud security markets.
9. Nu Holdings Ltd. (NYSE:NU)
Number of Hedge Fund Holders: 80
Nu Holdings Ltd. (NYSE:NU) is one of the 12 Best Stocks to Buy and Hold for the Long Term. On June 13, analyst Jorge Kuri from Morgan Stanley reiterated a Buy rating on Nu Holdings Ltd. (NYSE:NU) with a price target of $18. The analyst based his bullish sentiment on the company’s potential to capitalize on the payroll loan market.
During the fiscal first-quarter earnings call for 2025, the management of Nu Holdings Ltd. (NYSE:NU) noted its public payroll loans gained traction growing 50% quarter-over-quarter. The company sees further unique opportunities in the new private payroll products in Brazil. Analyst Jorge Kuri highlighted he sees a significant opportunity for the company to gain as much as 10% of the payroll market by 2026.
Management noted its market share was still below 1% as of the first quarter, however, Kuri believes the market projections of 3% to 4% are underestimates of the company’s true potential. He noted its large customer base, efficient digital distribution model, and cost-effective pricing strategy to be key competitive advantages in gaining the expected market share.
Nu Holdings Ltd. (NYSE:NU) is a Brazil-based holding company that provides digital banking services. Its services include customized credit lines, mobile payments, interest-earning savings accounts, investment products, and more.
8. Applied Materials, Inc. (NASDAQ:AMAT)
Number of Hedge Fund Holders: 83
Applied Materials, Inc. (NASDAQ:AMAT) is one of the 12 Best Stocks to Buy and Hold for the Long Term. On June 16, Shane Brett CFA from Morgan Stanley maintained a Hold rating on Applied Materials, Inc. (NASDAQ:AMAT) with a price target of $158. The cautious rating is based on a mixed outlook on Taiwan Semiconductor Manufacturing (NYSE:TSM) and DRAM growth.
Shane Brett noted Applied Materials, Inc. (NASDAQ:AMAT)’s DRAM revenue is expected to drop 12% in fiscal 2026. On the other hand, some analysts remain optimistic about the company driven by new technologies like Gate-All-Around (GAA) transistors and backside power delivery. The outlook regarding the company’s valuation also presented variation, with some analysts believing the company’s semiconductor equipment business (SPE) deserves higher trading multiple due to its growth prospects. On the other hand, some think current valuations are considerably elevated. Due to this mixed outlook around Applied Materials, Inc. (NASDAQ:AMAT), Brett maintained a Hold rating on the stock.
During the fiscal second quarter of 2025, Applied Materials, Inc. (NASDAQ:AMAT) reported a revenue of $7.1 billion, reflecting a 7% increase year-over-year. The growth was driven by solid performance across the board. Notably, the gross margins improved 170 basis points to 49.2% reflecting the highest quarterly margins since FQ4 2000. Looking ahead, management anticipates slight year-over-year growth with revenue between $7.15 billion and $7.25 billion.
7. Booking Holdings Inc. (NASDAQ:BKNG)
Number of Hedge Fund Holders: 102
Booking Holdings Inc. (NASDAQ:BKNG) is one of the 12 Best Stocks to Buy and Hold for the Long Term. On June 10, BTIG analyst Jake Fuller maintained a Buy rating on Booking Holdings Inc. (NASDAQ:BKNG) while raising the price target from $5,500 to $6,250. The raised price target comes after the company posted a strong fiscal first quarter of 2025 beating market expectations.
The company released its results on April 29. It posted a total revenue of $4.76 billion, up 7.86% year-over-year and ahead of expectations by $171.91 million. The EPS of $24.81 also came in ahead of consensus by $7.24. The growth was driven by an increase in Room Nights and total gross bookings, both indicators grew 7% year-over-year.
Management noted that while the macroeconomic and geo-political environment remains tense Booking Holdings Inc. (NASDAQ:BKNG) has been focusing on delivering long-term value by focusing on strategic partnerships and priorities. One such example of long-term strategic partnership came in on June 12 when the company announced an eight-year extension of its partnership with the Etraveli Group. The extended partnership allows the company to operate seamlessly in 57 countries.
6. Tesla, Inc. (NASDAQ:TSLA)
Number of Hedge Fund Holders: 104
Tesla, Inc. (NASDAQ:TSLA) is one of the 12 Best Stocks to Buy and Hold for the Long Term. On June 20, Morgan Stanley analyst Adam Jonas maintained a Buy rating on Tesla, Inc. (NASDAQ:TSLA) with a price target of $410. The rating comes right before the company is set to test self-driving vehicles.
Jonas highlighted that the market is underestimating the role of automobiles in the overall hybrid computing market. He suggests that Tesla, Inc. (NASDAQ:TSLA) has the potential to leverage new AI-enabled technologies to innovate self-driving vehicles beyond traditional functions. Jonas sees the company’s upcoming tests as a step closer to a future where AI and robotics take new robotic forms, which will require complex computing systems.
The analyst sees Tesla, Inc. (NASDAQ:TSLA) playing a crucial role in enabling the robotic muscle and expanding the robotic market with the degree of freedom that makes it futuristic. Thus Jonas remains optimistic about the strategic growth opportunities for the company in the technology industry.
5. Uber Technologies, Inc. (NYSE:UBER)
Number of Hedge Fund Holders: 145
Uber Technologies, Inc. (NYSE:UBER) is one of the 12 Best Stocks to Buy and Hold for the Long Term. On June 18, Justin Post from Bank of America Securities maintained a Buy rating on Uber Technologies, Inc. (NYSE:UBER) with a price target of $97. The rating comes on the back of an improved outlook for the company considering its partnerships with autonomous vehicle companies and expansion in ride-hailing services.
On June 10, Uber Technologies, Inc. (NYSE:UBER) announced its partnership with Wayve to launch level 4 autonomous vehicles in London. This will be a trial launch which will focus on Level 4 driverless cars, capable of full self-driving within defined areas. The collaboration is just another instance of the company’s partnership to enable autonomous vehicles. Analyst Post highlighted Uber’s partnership with Waymo in California to test vehicles in New York. He believes these partnerships align with Uber Technologies, Inc. (NYSE:UBER)’s expansion strategy.
Moreover, the established network and diverse set of partnerships with industry leaders enables the company to mitigate risks arising from strong competition. In addition, Uber Technologies, Inc. (NYSE:UBER) continues to grow its ride-hailing platform. The number of trips for Q1 2025 grew 18% year-over-year to reach 3 billion, driven by a 14% growth in monthly active platform customers.
4. Taiwan Semiconductor Manufacturing Company Limited (NYSE:TSM)
Number of Hedge Fund Holders: 187
Taiwan Semiconductor Manufacturing Company Limited (NYSE:TSM) is one of the 12 Best Stocks to Buy and Hold for the Long Term. On June 17, Susquehanna raised the firm’s price target on Taiwan Semiconductor Manufacturing Company Limited (NYSE:TSM) from $250 to $255 while keeping a Buy rating on the stock. The increased price target comes at a time when AI growth sentiment is weakening and global tariffs topped with geo-political uncertainties are posing challenges for the company.
The firm noted recent checks indicate that increased demand for AI-related wafer shipments in Q2 is compensating for weaker shipments in the smartphone segment. Moreover, the surge in AI chip demand is a critical growth driver for Taiwan Semiconductor Manufacturing Company Limited (NYSE:TSM) as advanced chips used in AI applications are seeing robust orders, even as traditional consumer electronics like smartphones face cyclical softness.
Susquehanna also highlighted that TSM is likely to remain the only leading-edge foundry provider through at least 2027, thereby reassuring its market-leading position. Moreover, Ariel Global Fund also noted Taiwan Semiconductor Manufacturing Company Limited (NYSE:TSM) in its Q1 2025 investor letter, noting the company has a dominant share in the global foundry industry. Despite the recent shift in AI sentiment, the fund continues to see the company’s earnings benefiting from long-term AI trends.
Ariel Global Fund stated the following regarding Taiwan Semiconductor Manufacturing Company Limited (NYSE:TSM) in its Q1 2025 investor letter:
“Taiwan Semiconductor Manufacturing Company Limited (NYSE:TSM) shares declined on weakening sentiment regarding Artificial Intelligence (AI) growth, the impact of tariffs and global macroeconomic uncertainty. TSMC has a dominant share of the global foundry market and is an industry leader in terms of scale, technology, customer service and execution. As such, we expect the company’s earnings will benefit from secular growth trends of AI longer-term. Meanwhile, TSMC remains committed to returning capital to shareholders through buybacks and dividends.”
3. NVIDIA Corporation (NASDAQ:NVDA)
Number of Hedge Fund Holders: 212
NVIDIA Corporation (NASDAQ:NVDA) is one of the 12 Best Stocks to Buy and Hold for the Long Term. The company that has been at the forefront of AI technology is now entering the next phase of innovation with AI Humanoid Robots. On June 20, Reuters reported Taiwan’s Foxconn and NVIDIA Corporation (NASDAQ:NVDA) are collaborating to deploy humanoid robots at the Foxconn factory to produce NVIDIA’s AI servers.
This is a significant move as it marks the first time where NVIDIA’s products would be produced with robotic assistance and it would also make the Foxconn facility to be the first to deploy humanoids in its production line. According to the source the deployment is anticipated to be finalized in the coming months with humanoid robots working at the facility by the first quarter of next year.
Moreover, NVIDIA Corporation (NASDAQ:NVDA) also gained back investor confidence after beating Wall Street guidance for Q1 2025. The company posted a revenue of $44.06 billion, reflecting a 69% year-over-year increase. The top line exceeded the consensus by $813.47 million, despite the tariff situation and Chinese control.
2. Alphabet Inc. (NASDAQ:GOOGL)
Number of Hedge Fund Holders: 227
Alphabet Inc. (NASDAQ:GOOGL) is one of the 12 Best Stocks to Buy and Hold for the Long Term. On June 10, Reuters reported that OpenAI has indicated its plans to add Alphabet Inc. (NASDAQ:GOOGL)’s cloud services to meet its growing demand for computing needs. This marks a notable advancement as both the company’s are seen as competitors in the AI industry.
As per Reuters, the deal was in consideration for months and is said to have been finalized in May. This highlights the massive nature of computing needs required to train and deploy AI models. On the other hand, analysts are seeing this as a major win for Alphabet Inc. (NASDAQ:GOOGL) which will now be supplying computing capacity to OpenAI’s existing infrastructure.
Moreover, Scotiabank analysts also took note of this development calling it a somewhat surprising advancement. The analyst acknowledged the deal to be a win for Google Cloud Unit. They highlighted that the deal underscores that both companies are looking beyond competition to address the growing demand for computing needs. However, the analysts at Scotiabank also expressed caution for Alphabet Inc. (NASDAQ:GOOGL) as ChatGPT is becoming a threat to the company’s search dominance.
1. Microsoft Corporation (NASDAQ:MSFT)
Number of Hedge Fund Holders: 284
Microsoft Corporation (NASDAQ:MSFT) is one of the 12 Best Stocks to Buy and Hold for the Long Term. On June 19, the Financial Times reported the long-standing partnership between Microsoft Corporation (NASDAQ:MSFT) and OpenAI might come to an end as tensions persist between the two on key issues including the future stake of MSFT in OpenAI.
The partnership between the two began in 2019 with Microsoft Corporation (NASDAQ:MSFT)’s $1 billion investment in OpenAI. Under the partnership, Microsoft is entitled to 49% of OpenAI Global LLC’s profits, capped at roughly 10 times its investment. OpenAI operates as a “capped profit” company, meaning investor returns are limited beyond a certain threshold.
Microsoft Corporation (NASDAQ:MSFT) has invested more than $13 billion to date and has played a key role in positioning the company as a market leader. However, the tensions have revolved around the future stake of MSFT in OpenAI. According to the Financial Times, the discussion regarding the stakes has ranged from 20% to 49%, however, no decision has been reached yet.
OpenAI requires approval from Microsoft Corporation (NASDAQ:MSFT) to complete its transition as a public benefit corporation. On the other hand, Microsoft plans to keep its existing commercial contract until 2030. The WSJ also reported that both companies are discussing the existing terms of Microsoft’s investment and the future stake.
“We have a long-term, productive partnership that has delivered amazing AI tools for everyone. Talks are ongoing and we are optimistic we will continue to build together for years to come” said Microsoft Corporation (NASDAQ:MSFT) and OpenAi in a joint statement.
While we acknowledge the potential of MSFT to grow, our conviction lies in the belief that some AI stocks hold greater promise for delivering higher returns and have limited downside risk. If you are looking for an AI stock that is more promising than MSFT and that has 100x upside potential, check out our report about this cheapest AI stock.
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Disclosure: None.
