Best Foundational Stocks

We help investors build the foundation of their portfolios with the best US foundational stocks by sector. If all goes well, you should buy these shares at the beginning of your portfolio and keep them forever. Which ones play this role for you? Let us know!

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You’ll Learn

Before we start let’s cover the benefits of investing with a long-term horizon. Don’t you want to avoid panicking?
What’s the definition of a foundational stock? Which role should they play in our portfolios? You should have a conviction strong enough in these picks that you’d put them in a black box and don’t look at them for at least 10 years.
In the technology sector, Mike selected Apple (AAPL) and Microsoft (MSFT) as the best foundational stocks in this sector. There are multiple good tech options on the US market, so why are these two?
Some investors may think tech businesses are too volatile to be considered foundational stocks. Why should this sector be part of an investor’s core portfolio?
Johnson & Johnson (JNJ), Abbott Laboratories (ABT), and AbbVie (ABBV) are the foundational players in the healthcare sector. Mike tells us more about them,
Healthcare companies are often the subject of lawsuits or suffer from patent expiry or become irrelevant with a new drug’s arrival. How are these picks better protected against those risks?
For REITs, Mike named Equinix (EQIX), Prologis (PLD), and National Retail Properties (NNN) as the best foundational stocks. Why are they his top choices?
REITs have had a hard time in recent years. Higher interest rates also impact them negatively. Is it still relevant to hold some, or should investors simply skip them and focus on other sectors?
Regarding skipping some sectors or industries, Mike chose no companies in the Materials and Telecoms. Why?
Vero decided to take that as a challenge and went on Dividend Stocks Rock Stock Screener to find some. What does Mike think about Sherwin-Williams (SHW) in the material sector and Comcast (CMCSA) for telcos?
Mike is not a fan of the energy sector. When the episode was discussed, he said: “Maybe Exxon Mobil (XOM), but not sure.” Why is it so?
BlackRock (BLK), Visa, and Mastercard are on top in the financial sector. What makes them perfect for a long-term horizon?
With a yield under 1% for Visa and MasterCard, wouldn’t investors be better off holding shares of insurance companies like Aflac (AFL), Ameriprise Financial (AMP), or even Bank of America (BAC)?
There seem to be a lot of possibilities for the industrial sector in the US: Automatic Data Processing (ADP), Honeywell (HON), Northrup Gruman (NOC), Lockheed Martin (LMT), and Waste Management (WM) are Mike’s choices. What do they have in common or what makes them unique?
The consumer staples sector provides investors with a lot of internationally known brands. To build a base for a portfolio, Mike would go for Coca-Cola (KO), Pepsi (PEP), Procter & Gamble (PG), Costco (COST), and Walmart (WMT). Some offer more growth than others on this list. What still makes them all good options?
Moving on to other well-known names for the consumer discretionary sector: Home Depot (HD), Nike (NKE), Genuine Parts (GPC), McDonalds (MCD), and Starbucks (SBUX). Why does Mike like them?
Considering the current economy, are they recession-resistant enough?
As a foundation for utilities, American Water Works (AWK), American States Water (AWR), and NextEra Energy (NEE) would do the work.
While we all need utilities, they’ve been hit hard lately. Also, considering the transition to greener energy, are utilities a real opportunity or is their future a bit foggy?