On August 22, Friday, the stock market went up after Federal Reserve Chair Jerome Powell indicated that the central bank might have to start lowering interest rates in September.
The Dow Jones Industrial Average gained 1.89% to reach a new all-time high and close at a record level. The S&P 500 also went up by 1.52%. The tech-heavy Nasdaq Composite climbed 1.88%.
Megacap technology stocks surged after Powell’s remarks.
Powell said that the current economic situation and risks might mean the Fed needs to change its policy. He noted that the balance of risks is shifting between the Fed’s dual mandate of full employment and stable prices. Powell also noted big changes in tax, trade, and immigration policies.
After these comments, the chances of the Fed cutting interest rates by a quarter-point in September jumped to about 83%, according to the CME Group’s FedWatch tool. This was up from the 75% chance expected earlier in the week.
With this background in mind, let’s take a look at the 10 best stocks for 5 years for a long-term stock portfolio.
Stocks
Our Methodology
To compile our list of the 10 best stocks for 5 years for a long-term stock portfolio, we looked for “long-term stocks to buy” and “stocks to invest in for the next 5 years.” We reviewed various online resources and financial media reports to compile a list of more than 25 best long-term stocks. Next, we focused on the top 10 stocks most favored by institutional investors. Data for the hedge fund sentiment surrounding each stock was taken from Insider Monkey’s Q2 2025 database of 983 elite hedge funds. Finally, the 10 best stocks to buy for the next 5 years were ranked in ascending order based on the number of hedge funds holding stakes in them as of Q2 2025.
Why do we care about what hedge funds do? 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).
Long-Term Stock Portfolio: 10 Best Stocks for 5 Years
10. Shopify Inc. (NASDAQ:SHOP)
Number of Hedge Fund Holders: 69
Shopify Inc. (NASDAQ:SHOP) is one of the best long-term stocks to buy for the next 5 years. On August 7, Benchmark increased its price target for Shopify Inc. (NASDAQ:SHOP) from $140 to $190 while keeping a Buy rating.
This decision to raise the price target came after Shopify Inc. (NASDAQ:SHOP) shared results for the second quarter of 2025.
Shopify Inc. (NASDAQ:SHOP) reported a 31% year-over-year growth in its Gross Merchandise Volume (GMV). According to Benchmark, this marked the company’s strongest growth in 3.5 years.
The company also reported faster GMV and revenue growth in North America, Europe, and Asia Pacific compared to the first quarter of 2025. Shopify Inc. (NASDAQ:SHOP) still has a lot of potential to grow its market share, especially in international markets.
Shopify Inc. (NASDAQ:SHOP) is a global commerce company that offers an all-in-one e-commerce platform to start, run, and grow a business.
9. Verizon Communications Inc. (NYSE:VZ)
Number of Hedge Fund Holders: 71
Verizon Communications Inc. (NYSE:VZ) is one of the best long-term stocks to buy for the next 5 years. On August 20, Verizon Communications Inc. (NYSE:VZ) announced new plans to offer prepaid customers expanded global connectivity.
Two key brands in Verizon Communications Inc.’s (NYSE:VZ) Value portfolio, Simple Mobile and Total Wireless, will start offering enhanced plans and expanded roaming services to prepaid customers on August 28.
According to the report by Verizon Communications Inc. (NYSE:VZ), the new plans will include unlimited calling and texting to over 200 countries. This makes these plans great options for customers who travel internationally.
Verizon Communications Inc. (NYSE:VZ) noted that besides traditional destinations like Mexico, Canada, and the UK, the Asia Pacific region is attracting American travelers at unprecedented levels. These plans will help meet the rising demand for international connectivity.
Both Simple Mobile and Total Wireless serve different customer needs while utilizing Verizon Communications Inc.’s (NYSE:VZ) strong network to offer international features that expand offerings for prepaid customers.
Verizon Communications Inc. (NYSE:VZ) is an American technology and telecommunications company that provides reliable network connectivity, entertainment, and security solutions.
8. Palantir Technologies Inc. (NASDAQ:PLTR)
Number of Hedge Fund Holders: 78
Palantir Technologies Inc. (NASDAQ:PLTR) is one of the best long-term stocks to buy for the next 5 years. On August 12, Palantir Technologies Inc. (NASDAQ:PLTR) reported a multi-year expansion of its partnership with SOMPO Holdings through its Japanese joint venture Palantir Technologies Japan KK.
SOMPO has been using Palantir Technologies Inc.’s (NASDAQ:PLTR) Foundry across many of its subsidiaries with thousands of daily users. Since 2020, SOMPO has used Foundry in care facilities in Japan to help take care of senior citizens, reporting care to the government, and raising urgent patient needs.
Recently, SOMPO Japan started using Palantir Technologies Inc.’s (NASDAQ:PLTR) Foundry to enhance its claims process from start to finish. Foundry, which is deeply embedded at all stages in important decisions, helps with fraud detection, claim triage, and ongoing monitoring. SOMPO is using Foundry to make its claims payment process better and more efficient through initiatives like optimizing claim allocation.
According to the report by Palantir Technologies Inc. (NASDAQ:PLTR), AI agents are also helping underwriters by automatically assessing risk and giving recommendations. This is expected to help SOMPO annually improve its financial results by $10 million.
This is the second expansion of the partnership between SOMPO and Palantir Technologies Inc. (NASDAQ:PLTR), following a $50 million expansion of the partnership in 2023.
Palantir Technologies Inc. (NASDAQ:PLTR) is an American software company that specializes in big data analytics. The company serves key government and commercial enterprises.
7. Airbnb, Inc. (NASDAQ:ABNB)
Number of Hedge Fund Holders: 79
Airbnb, Inc. (NASDAQ:ABNB) is one of the best long-term stocks to buy for the next 5 years. On August 14, Airbnb, Inc. (NASDAQ:ABNB) reported that it is introducing a new payment option called ‘Reserve Now, Pay Later.’
This feature by Airbnb, Inc. (NASDAQ:ABNB) provides greater flexibility, allowing guests in the US to book eligible domestic stays without paying anything upfront.
Through ‘Reserve Now, Pay Later,’ US travelers can reserve listings and pay later. The guests only need to pay before the free cancellation period ends. According to Airbnb, Inc. (NASDAQ:ABNB), this offers more flexible options for guests and it may also help hosts get more bookings.
The new payment option works with listings with a moderate or flexible cancellation policy. Cancellation policies set by hosts stay the same. Additionally, because guests must pay before the free cancellation period ends, hosts have enough time to find another booking even if a guest cancels.
Airbnb, Inc. (NASDAQ:ABNB) operates an online marketplace for short-and long-term homestays, experiences, and services in more than 220 countries and regions. The company charges a commission on each booking.
6. Johnson & Johnson (NYSE:JNJ)
Number of Hedge Fund Holders: 95
Johnson & Johnson (NYSE:JNJ) is one of the best long-term stocks to buy for the next 5 years. On August 21, Johnson & Johnson (NYSE:JNJ) announced that it will be expanding its presence in North Carolina through a manufacturing facility of more than 160,000 square feet at FUJIFILM’s new biopharmaceutical manufacturing site in Holly Springs, North Carolina.
With a $2 billion commitment to FUJIFILM over the next 10 years, Johnson & Johnson (NYSE:JNJ) will increase its manufacturing capacity in the US. This project is also expected to create about 120 new jobs in North Carolina.
The company aims to produce the vast majority of its advanced medicines in the US to better serve the patients in the country.
In the coming months, Johnson & Johnson (NYSE:JNJ) also aims to share its plans for more advanced manufacturing facilities in the US as well as its plans to expand existing sites in the country.
Previously, in March, Johnson & Johnson (NYSE:JNJ) said it would invest $55 billion over the next four years to support US manufacturing, research and development, and technology investments.
Johnson & Johnson (NYSE:JNJ) is an American multinational healthcare company that specializes in pharmaceuticals and medical technologies.
5. Intuitive Surgical, Inc. (NASDAQ:ISRG)
Number of Hedge Fund Holders: 107
Intuitive Surgical, Inc. (NASDAQ:ISRG) is one of the best long-term stocks to buy for the next 5 years. On August 22, Piper Sandler reiterated its Overweight rating on Intuitive Surgical, Inc. (NASDAQ:ISRG) with a price target of $595. This decision came after a management meeting as part of the firm’s West Coast Bus Trip.
Piper Sandler met with Intuitive Surgical, Inc.’s (NASDAQ:ISRG) Executive Vice President and CFO, Jamie Samath, and Vice President and Head of Investor Relations, Dan Connally.
The research firm noted that on August 21, Intuitive Surgical, Inc. (NASDAQ:ISRG) declined 2.2%. This was a bigger drop than the 1.1% fall in the iShares U.S. Medical Devices ETF (IHI). Piper Sandler suggested that the firm found little justification for this bigger decline.
Piper Sandler keeps a positive outlook on Intuitive Surgical, Inc. (NASDAQ:ISRG). The firm believes there is “ample upside to models, particularly on the procedure side of things.” This positions the company well to beat financial expectations in the future.
These factors are also expected to help Intuitive Surgical, Inc. (NASDAQ:ISRG) maintain its “best-in-class financial profile.”
Intuitive Surgical, Inc. (NASDAQ:ISRG) is an American medical device and technology company that develops and manufactures robotic-assisted surgical systems for physicians and hospitals to make surgery less invasive.
4. The Walt Disney Company (NYSE:DIS)
Number of Hedge Fund Holders: 111
The Walt Disney Company (NYSE:DIS) is one of the best long-term stocks to buy for the next 5 years. On August 21, KeyBanc maintained its Sector Weight rating on The Walt Disney Company (NYSE:DIS).
KeyBanc’s analysis looked closely at Disney Cruise Line (DCL), which is operated by a subsidiary of The Walt Disney Company (NYSE:DIS) in the UK called “The Magical Cruise Company.”
The firm highlighted that DCL’s revenue in fiscal year 2024 was higher than pre-pandemic levels. This revenue made up about 7% of The Walt Disney Company’s (NYSE:DIS) Experiences segment revenue. DCL contributed around 1 percentage point to the segment’s growth in fiscal year 2024.
KeyBanc expects DCL’s revenue to double from fiscal year 2024 to fiscal year 2026 because of the addition of two cruise ships. The cruise line is expected to generate mid-to-high-teens yield.
However, KeyBanc noted that revenue from Domestic Experiences could make the Domestic Park growth look better than it really is. The firm believes competition will become tougher at Walt Disney World, with spending per visitor likely to slow down at Disneyland.
KeyBanc increased its forecast for The Walt Disney Company’s (NYSE:DIS) capital expenditure in fiscal year 2026. The firm noted that consensus estimates either expect too much contribution from DCL or not enough slowdown in the domestic parks’ performance.
The Walt Disney Company (NYSE:DIS) is an American multinational mass media and entertainment conglomerate that operates through 3 core business segments: Disney Entertainment, ESPN, and Disney Experiences.
3. MercadoLibre, Inc. (NASDAQ:MELI)
Number of Hedge Fund Holders: 116
MercadoLibre, Inc. (NASDAQ:MELI) is one of the best long-term stocks to buy for the next 5 years. On August 5, Cantor Fitzgerald maintained its Overweight rating on MercadoLibre, Inc. (NASDAQ:MELI) with a price target of $2,700.
This decision came after the company reported Q2 2025 results, which surpassed the firm’s expectations.
MercadoLibre, Inc.’s (NASDAQ:MELI) revenue and EBIT for Q2 2025 exceeded Cantor Fitzgerald’s estimates by 9% and 5%. The company saw total Gross Merchandise Volume (GMV) increase 37% compared to the same period last year, excluding foreign exchange effects. This growth was driven by strong performance across different regions and changes to the shipping program made in June.
In the Brazilian market, MercadoLibre, Inc. (NASDAQ:MELI) reported faster growth in both the number of units sold and GMV after the company lowered its free shipping threshold. In the fintech segment, the growth in acquiring Total Payment Volume (TPV) was more than 50% year-over-year on an FX-neutral basis. The credit portfolio also reached 91% growth year-over-year.
Cantor Fitzgerald increased its estimates for MercadoLibre, Inc.’s (NASDAQ:MELI) GMV and TPV for 2026 by 4% and 5%, respectively.
MercadoLibre, Inc. (NASDAQ:MELI) is the leading e-commerce and financial technology company in Latin America, with a presence in 18 countries.
2. Alphabet Inc. (NASDAQ:GOOGL)
Number of Hedge Fund Holders: 219
Alphabet Inc. (NASDAQ:GOOGL) is one of the best long-term stocks to buy for the next 5 years. On August 21, Stifel reaffirmed its Buy rating on Alphabet Inc. (NASDAQ:GOOGL) with a $222 price target.
This decision to reiterate the Buy rating on Alphabet Inc. (NASDAQ:GOOGL) came after Google’s Made by Google event.
At the event, Google introduced a new lineup of Pixel smartphones and gadgets. Rick Osterloh, Google’s Senior Vice President of Platforms & Devices, talked about the company’s efforts to embed Gemini AI across products.
Stifel pointed out that Pixel devices currently hold about 3% of the market share in the US. However, the event showcased key features like Gemini AI and Agents that can help Pixel devices stand out compared to devices by competitors, especially Apple Inc. (AAPL).
Alphabet Inc. (NASDAQ:GOOGL) is an American multinational technology company and the parent company of Google. The company’s products include Search, Ads, Chrome, Cloud, YouTube, and Android.
1. Amazon.com, Inc. (NASDAQ:AMZN)
Number of Hedge Fund Holders: 335
Amazon.com, Inc. (NASDAQ:AMZN) is one of the best long-term stocks to buy for the next 5 years. On August 13, Amazon.com, Inc. (NASDAQ:AMZN) announced that customers in over 1,000 cities and towns across the US can now add fresh groceries to their “Same-Day Delivery” orders.
This service will grow to cover more than 2,300 cities and towns by the end of the year. Amazon.com, Inc. (NASDAQ:AMZN) plans to continue expanding this service and adding more cities and towns throughout 2026.
This is one of the biggest grocery expansions for Amazon.com, Inc. (NASDAQ:AMZN) as the company is adding thousands of perishable food items into its fast and efficient existing logistics network. Customers can order produce, dairy, meat, seafood, baked goods, and frozen foods, along with millions of other products like household items, electronics, clothes, and garden supplies.
According to the report by Amazon.com, Inc. (NASDAQ:AMZN), Prime members get free Same-Day Delivery for orders over $25 in most cities. If the order is less than $25, Prime members can still get Same-Day Delivery for a $2.99 fee. Customers without a Prime membership can use this service for a $12.99 fee, regardless of order size.
Amazon.com, Inc. (NASDAQ:AMZN) is a technology company that specializes in e-commerce, cloud computing, online advertising, digital streaming, and artificial intelligence.
While we acknowledge the potential of AMZN as an investment, 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 AMZN and that has a 100x upside potential, check out our report about the cheapest AI stock.
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Disclosure: None.
