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Globe and Mail
16 hours ago
- Business
- Globe and Mail
These 2 Dow Stocks Are Set to Soar in 2025 and Beyond
The Dow Jones Industrial Average (DJINDICES: ^DJI) index, which includes the 30 most prominent companies in the U.S., is used by some as a benchmark of the American economy. Over the past 10 years, the Dow advanced about 135%, even as the COVID-19 pandemic, inflation, rising interest rates, and other macro headwinds rattled the markets. Also, over that decade, some well-known companies, including General Electric, ExxonMobil, Pfizer, and Intel, were removed from the index and replaced by higher-growth companies, including Amazon, Salesforce, and Nvidia. But despite those occasional changes, the Dow remains a good starting point for seeking out some promising long-term investments. Today, I'll look at two of those stocks -- Apple (NASDAQ: AAPL) and Cisco Systems (NASDAQ: CSCO) -- and explain why they're set to soar in 2025 and beyond. Apple Apple's stock has slumped about 20% since the beginning of the year. The bulls shunned the tech titan for four main reasons. First, the Trump administration's unpredictable tariffs, especially against China, could cause its production costs to soar. Second, Apple's AI efforts failed to impress investors as much as OpenAI's ChatGPT and other generative AI platforms. Third, its closely watched mixed reality efforts fizzled out after it halted its production of the Vision Pro. Lastly, Fortnite publisher Epic Games won a major legal victory against Apple after a U.S. court ruled that the company could bypass its App Store fees with other payment methods. That victory could allow other developers to bypass Apple's 30% fees with a similar payment measure. All of those challenges -- along with Warren Buffett's decision to trim Berkshire Hathaway 's big stake in Apple over the past year -- weighed down its stock. Yet investors are overlooking some of Apple's long-term strengths. It ended its latest quarter with $133 billion in cash and marketable securities, which gives it ample room for fresh investments and acquisitions. It has an installed device base of over 2.2 billion, and it's already locked in over a billion paid subscriptions across all of its services. It could leverage that massive audience to justify its App Store fees as it appeals the Epic Games ruling. Apple's brand appeal, the stickiness of its ecosystem, and its high switching costs should continue to drive its future sales of iPhones, Macs, iPads, and other devices. Its rollout of new custom chips, its integration of new AI features, and a more affordable version of the Vision Pro -- which might arrive in 2026 or 2027 -- could keep it ahead of its Android-based rivals. As for the tariffs, it could mitigate those impacts by shifting its supply chains to lower-tariff countries like India or Vietnam. From fiscal 2024, which ended last September, to fiscal 2027, analysts expect Apple's earnings per share (EPS) to grow at a compound annual growth rate (CAGR) of 12%. Its stock still looks reasonably valued at 26 times next year's earnings, and it should head higher once it resolves its near-term issues. Cisco Systems Cisco's stock has risen about 6% this year. Investors warmed up to the world's top networking hardware and software company as its growth stabilized and fresh catalysts appeared on the horizon. It struggled in fiscal 2024, which ended last July, as its customers placed too many hardware orders after its previous supply constraints eased in fiscal 2023. A challenging macro environment then drove those customers to deploy those devices at a slower-than-expected rate -- so Cisco's shipments abruptly dried up. But over the past year, Cisco's hardware sales stabilized as the market's demand finally caught up with its inventories again. It also expanded its observability segment by acquiring Splunk last March, and it's been expanding its cybersecurity business with new AI-powered services such as Hypershield and AI Defense. Moreover, its AI-related infrastructure business continued to expand and generated $1.35 billion in revenue in the first nine months of fiscal 2025. That accounted for 3% of its revenue during those three quarters and easily surpassed its prior goal for generating $1 billion in AI infrastructure revenue for the full fiscal year. Cisco will probably never become a hypergrowth AI play like Nvidia, yet it provides the essential building blocks for the growing data center, cloud, and AI markets. With $15.6 billion in cash and marketable securities at the end of its latest quarter, it still has plenty of room to expand its higher-growth businesses and maintain its buybacks, which cancelled out over a fifth of its shares over the past decade, for years to come. From fiscal 2024 to fiscal 2027, analysts expect Cisco's EPS to grow at a CAGR of 9% -- and its stock still isn't expensive at 22 times next year's earnings. Simply put, it could head a lot higher over the next few years as its core markets expand. Should you invest $1,000 in Apple right now? Before you buy stock in Apple, consider this: The Motley Fool Stock Advisor analyst team just identified what they believe are the 10 best stocks for investors to buy now… and Apple wasn't one of them. The 10 stocks that made the cut could produce monster returns in the coming years. Consider when Netflix made this list on December 17, 2004... if you invested $1,000 at the time of our recommendation, you'd have $651,049!* Or when Nvidia made this list on April 15, 2005... if you invested $1,000 at the time of our recommendation, you'd have $828,224!* Now, it's worth noting Stock Advisor 's total average return is979% — a market-crushing outperformance compared to171%for the S&P 500. Don't miss out on the latest top 10 list, available when you join Stock Advisor. See the 10 stocks » *Stock Advisor returns as of June 2, 2025 John Mackey, former CEO of Whole Foods Market, an Amazon subsidiary, is a member of The Motley Fool's board of directors. Leo Sun has positions in Amazon, Apple, Berkshire Hathaway, and Pfizer. The Motley Fool has positions in and recommends Amazon, Apple, Berkshire Hathaway, Cisco Systems, Intel, Nvidia, Pfizer, and Salesforce. The Motley Fool recommends GE Aerospace and recommends the following options: short August 2025 $24 calls on Intel. The Motley Fool has a disclosure policy.
Yahoo
2 days ago
- Business
- Yahoo
Opinion - Main Street deserves access to private markets
On the campaign trail, President Trump promised to revive the American economy and deliver greater opportunity for working families: to create 'a middle class that is once again the envy of the entire world.' Making that pledge a reality starts with tax cuts and deregulation but doesn't end there. It will require policymakers to reconsider who has access to wealth-building opportunities. Unfortunately, far too many Americans lack the tools available to the wealthy. More Americans deserve the opportunity to invest in private markets, and that's something Trump's administration can provide. The Securities and Exchange Commission has a unique opportunity to help level the playing field. It has been more than 30 years since the agency reviewed the regulatory framework for retail funds created by the Investment Company Act of 1940. By modernizing these outdated rules and expanding access to private markets, the Securities and Exchange Commission can help put Main Street investors back on equal footing with Wall Street and big corporations. Over the last decade, private markets have exploded, growing to around $25 trillion since 2012. Big institutions like pension funds, endowments and hedge funds have long used these investments to earn higher returns than what's available in the stock market. But for everyday Americans? This opportunity to invest is largely off limits. Outdated regulations are primarily to blame. They assume retail investors can't handle the risks of private markets. In reality, institutional fund managers already invest responsibly in private markets on behalf of workers like teachers and police officers. Like any investment, private markets require proper safeguards. But with the right protections in place, there's no reason similar access couldn't be extended to individual investors. This is where the Securities and Exchange Commission can step in. Consider the current restriction that prevents closed-end funds from allocating more than 15 percent of their assets to private funds. This artificial cap locks Main Street investors out of opportunities their pension funds already enjoy. Removing or relaxing this limit — while maintaining proper oversight — would be a good first step toward giving Main Street access to wealth-building opportunities readily available to Wall Street. Closed-end funds are uniquely positioned for private investments, but because closed-end funds often trade a discount to their net asset value, short term arbitrageurs often seek to 'open' fund to capture the spread between traded value and asset value. Such activists seek to profit at the expense of long-term investors. It would help to design governance structures and legal frameworks that ensure the stability funds need to focus on long-term value. This is not to suggest we shouldn't have responsive governance and transparency for all investors, but we should encourage and enable long-term thinking and investing. These common-sense reforms are necessary to remove the barriers that have left the middle class locked out of a key financial tool. We should update old rules to reflect today's economy and empower more Americans to build wealth in the same way institutions and the wealthy already do. If the Trump administration wants not only to support but also to build up the middle class, the solution goes beyond creating good jobs and stimulating economic growth. It will also involve expanding access to the financial opportunities that create long-term wealth. It's time to finally level the playing field and make private markets available to everyone. Vikram Mansharamani, chairman and CEO of Goodwell Foods, is a former lecturer at Harvard and Yale and has served on the boards of closed-end funds, publicly-traded companies, and start-up technology firms. Copyright 2025 Nexstar Media, Inc. All rights reserved. This material may not be published, broadcast, rewritten, or redistributed.
Globe and Mail
3 days ago
- Business
- Globe and Mail
1 No-Brainer S&P 500 Vanguard ETF to Buy Right Now for Less Than $1,000
The S&P 500 index is, without a doubt, the most closely watched stock market barometer on the planet. It contains some 500 large and profitable businesses listed on U.S. stock exchanges. Combined, they represent about 80% of the entire stock market capitalization. Investors who want exposure to the index don't need to look far to find a compelling exchange-traded fund (ETF) to add to their portfolio. In fact, there's one that deserves some attention. Here's why the Vanguard S&P 500 ETF (NYSEMKT: VOO) is a no-brainer buy for someone who might have less than $1,000 of money to put to work in the stock market. Where to invest $1,000 right now? Our analyst team just revealed what they believe are the 10 best stocks to buy right now. Continue » Instant diversification for your portfolio As mentioned, this ETF contains 500 stocks, so investors gain exposure to all sectors of the economy -- from information technology and financials to materials and real estate. This means there is a diverse range of businesses and industries included in the portfolio. At the end of the day, this ETF can be viewed as a bet on the ongoing ingenuity of the American economy and some of the hottest trends -- and this includes artificial intelligence (AI). Some of the ETF's top positions are in companies like Apple, Microsoft, and Nvidia, all of which are focused on AI-related initiatives to fortify their competitive positions. The ETF's sponsor, Vanguard, is one of the most highly regarded asset management firms in the industry. It's been around since 1975. As of the end of last year, it had eclipsed $10 trillion in assets under management, which goes to show you the amount of trust that so many investors (and so much capital) have in the business. The numbers are hard to ignore Warren Buffett, who has an unbelievable track record handling capital allocation and running Berkshire Hathaway, suggests that a low-cost ETF like the Vanguard S&P 500 ETF is the best investment option for most people out there. It's hard to beat an expense ratio of just 0.03%. That's pennies compared to the exorbitant fees you see active fund managers charge. A typical hedge fund charges its clients both a management fee and a performance fee. This can significantly eat away at returns over time. Even so, a good chunk of these so-called experts struggles to outperform the S&P 500 over long stretches of time. Because the S&P 500 has put up better returns than its historical average of 10% per year, it's no wonder the professionals are having a hard time. Just in the past decade, the Vanguard S&P 500 ETF has generated a total return of 232%, which would've turned a $1,000 initial investment into $3,300 today. It's all about mindset Even though the Vanguard S&P 500 ETF has produced such a great return, it doesn't necessarily mean that investors have achieved that same performance in their own portfolios. It's easy to fall victim to our emotions, with the goal of successfully trying to time the market, forcing us to trade too frequently, resulting in more damage being done. This is why it's critical to fixate on the next decade and beyond with your investments instead of the next month or year. The stock market rewards those who are patient and disciplined, even in the face of extreme bouts of volatility, like what we experienced earlier in 2025. It's impossible to say whether or not the Vanguard S&P 500 ETF will repeat its past decade's performance between now and 2035. However, I'm sure that long-term investors will end up with a very favorable result. Should you invest $1,000 in Vanguard S&P 500 ETF right now? Before you buy stock in Vanguard S&P 500 ETF, consider this: The Motley Fool Stock Advisor analyst team just identified what they believe are the 10 best stocks for investors to buy now… and Vanguard S&P 500 ETF wasn't one of them. The 10 stocks that made the cut could produce monster returns in the coming years. Consider when Netflix made this list on December 17, 2004... if you invested $1,000 at the time of our recommendation, you'd have $651,049!* Or when Nvidia made this list on April 15, 2005... if you invested $1,000 at the time of our recommendation, you'd have $828,224!* Now, it's worth noting Stock Advisor 's total average return is979% — a market-crushing outperformance compared to171%for the S&P 500. Don't miss out on the latest top 10 list, available when you join Stock Advisor. See the 10 stocks » *Stock Advisor returns as of May 19, 2025 Neil Patel has positions in Vanguard S&P 500 ETF. The Motley Fool has positions in and recommends Apple, Berkshire Hathaway, Microsoft, Nvidia, and Vanguard S&P 500 ETF. The Motley Fool recommends the following options: long January 2026 $395 calls on Microsoft and short January 2026 $405 calls on Microsoft. The Motley Fool has a disclosure policy.
Forbes
3 days ago
- Business
- Forbes
Diversify Your Business For Smarter Growth
Colorful diverse people crowd abstract art seamless pattern. Multi-ethnic community, big cultural ... More diversity group background illustration in modern collage painting style. In the dynamic and often unpredictable landscape of the business world, relying on a single product, service, or market can feel like navigating a tightrope without a safety net. By strategically expanding into new markets, companies can mitigate risks associated with market fluctuations, tap into unexplored customer segments, and unlock novel avenues for revenue generation, ultimately fostering long-term stability and a competitive edge. In my interview with Charlene Polite Corley, Nielsen's VP of Diverse Insights and Partnerships, who leads thought leadership and exclusive initiatives, she said, 'Business leaders know to diversify their investment portfolios, why not also their teams?' According to Nielsen's research, 34% of the buying power, or $7 trillion, comes from diverse communities. The American economy is resilient because of the diversity of its consumer base. Polity Corley encourages apprehensive organizations to think about diversity as their responsibility to their consumers. To serve the full market's potential, it is so hard to do without being inclusive. In my interview with Stacie de Armas, the Senior VP of Diverse Intelligence & Initiatives at Nielsen, she explained the business opportunities of serving a more diverse population. For example, the Hispanic population is 10 years younger than other ethnic populations in the U.S. The Hispanic population also overindexes on loyalty, so this is a longer-term opportunity. De Armas said, "When you have these groups of customers who haven't necessarily had the opportunity to build an affinity for your brand yet, this is where your investment is going to get you two to three times more. This is where you're going to get the bigger return on investment. Not only does it make great business sense, but it's also a great opportunity to reach out and build loyalty with customers that you haven't had a relationship with in the past." Polite Corley said, 'Centering one community does not exclude other communities.' When you better serve one community, you better serve all communities. De Armas made clear, 'With diversity, there are more problem solvers. Similar groups have similar ways of thinking. New ideas come from engaging people who have been historically excluded.' Diversity is a significant driver of business growth. Engaging with historically excluded consumer groups is essential for long-term business growth as they represent untapped markets and offer greater potential for building brand loyalty and achieving higher returns on marketing investment. Polite Corley noted, "Black and African American consumers in particular remain the most likely to buy from brands that feature someone from their identity group in their ads. With the right folks at the table with the right data involved in your strategy, these are new opportunities and ways to ensure growth." Understanding nuanced cultural and consumption habits is crucial for effective marketing: A "copy-paste" approach to marketing is ineffective. Brands need to develop a deeper understanding of the media consumption habits and cultural nuances of diverse audiences to connect authentically and build lasting relationships. Data shows, for example, that Black, Hispanic, and Asian audiences spend significantly more time online. That is an opportunity for more online business. Centering diverse narratives benefits everyone and creates a broader cultural impact. Focusing on representing specific communities authentically in content and advertising doesn't exclude other groups. Instead, it provides "windows" into different experiences, enriching everyone's understanding and often leading to broader cultural trends and significant financial success.
Yahoo
3 days ago
- Business
- Yahoo
Soaring U.S. debt doesn't just put America at risk. It could trigger contagion across global markets, IIF warns
Treasury yields spiked recently amid mounting fears that investor demand for U.S. debt is waning just as supply is taking off, with a budget bill in Congress expected to add trillions to the deficit. But the effects of rising debt won't be limited to the American economy, according to the Institute of International Finance. It's not just Americans and the federal government poised to feel the effects of U.S. debt, which has exploded in recent years and could get even worse soon. Borrowing costs in certain countries often move in tandem, meaning volatility in Treasury bonds will create ripples in other debt, according to a recent report from the Institute of International Finance. 'The implications of rising U.S. debt levels are not limited to the domestic economy; they are also likely to trigger significant contagion and spillover effects across global bond markets,' IIF economists wrote on May 22. 'A potential increase in volatility in U.S. Treasury markets—driven by growing market attention to supply-demand dynamics and the composition of borrowing needed to finance anticipated large funding requirements—is likely to transmit to other jurisdictions, though the magnitude of the impact will vary.' U.S. debt has been top of mind lately as a Republican budget bill moving through Congress is expected to add trillions to the budget deficit in the coming years. That's jolted Treasury yields, and weak demand at a 20-year bond auction earlier this month exacerbated fears that investors won't have an appetite big enough for all the red ink coming soon. In fact, Deutsche Bank warned there's a buyer's strike among foreign investors, who are no longer willing to finance massive U.S. fiscal and trade deficits. IIF pointed out that there's a long-standing pattern of sovereign yields moving together, especially in the U.S., U.K., Germany and France, 'reflecting the deep interconnections among these economies through trade and capital markets.' Yield sensitivity is more limited in Japan and other some major emerging markets, according to IIF, but their interconnections were on display recently and showed that volatility can flow in both directions. A weak auction of 40-year Japanese government bonds on Wednesday sent JGB yields higher—and U.S. Treasury rates as well. Days earlier, George Saravelos, head of FX research at Deutsche Bank, predicted higher yields for Japanese assets would make them a more attractive alternative for local investors, encouraging further divestment from the U.S. To be sure, the vastness of the Treasury market and its deep liquidity mean that buyers and sellers will still be drawn to the U.S., but that immense size also crowds out others. IIF said in its report that there are signs of more sensitivity to rising U.S. debt levels among emerging markets, due in part to a shrinking pool of international capital available to sovereign EM borrowers. 'With the U.S. and Euro Area accounting for over 60% of global cross-border debt portfolios, emerging markets and developing countries represent less than 7%—with many individual countries accounting for only a fraction of a percent,' the report said. This story was originally featured on
