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Deciding which stocks to buy is a big decision for any investor, but choosing when to buy can be just as hard. Nobody wants to buy a stock and immediately see their investment turn red on a loss. Yet, it's a reality investors must face. The truth is that nobody can time the markets.
Sure, you might get lucky once or twice, but the better strategy is to think about companies that can grow over time and buy the stocks when they are reasonably valued or cheap.
The market has had a fantastic year, so most of the best companies seem expensive. That said, there are some exceptions. You can buy these three winning stocks at a reasonable price right now. The best part? You can buy a share of each for less than $1,000 all-in.
Here they are:
1. Nvidia
AI chip company Nvidia (NASDAQ: NVDA) keeps going up. The stock has risen more than 500% in just the past three years. Yet, there's still an argument for buying it today. The company has dominated the rapidly growing market for powerful chips used in data centers to train and operate artificial intelligence (AI) models. Nvidia has enjoyed jaw-dropping top and bottom line growth since early last year, which has fueled the stock's returns.
Nvidia is reporting hot demand for Blackwell, its next-generation successor to the H100 series chip that has sold hand-over-fist for most of the past two years. The continued demand for Nvidia's AI chips has analysts estimating the company will grow its earnings by an average of 41% annually for the next three to five years as AI investments continue across the economy. The stock trades at a forward P/E of 48, which Nvidia's anticipated earnings growth justifies paying. Investors should look for warning signs of competitive pressure on Nvidia's near-monopoly on AI chips. Assuming Nvidia stays dominant, it's hard not to like the stock here.
2. Meta Platforms
Social media giant Meta Platforms (NASDAQ: META) is becoming a potential AI juggernaut thanks to its co-founder and CEO Mark Zuckerberg, who has made AI a top priority. Not only has Meta developed and integrated AI into its business, including AI tools for digital ads (Meta's core business), but the company has open-sourced Llama, its large language model, and stockpiled AI chips to create top-of-the-market computing capabilities.
The great thing about Meta is that AI is arguably secondary to the company's fantastic core business. Its family of social media apps, Facebook, Instagram, WhatsApp, and Threads, has 3.27 billion daily active users, an audience that forms the basis to sell billions of dollars of advertising. Meta stock trades at 27 times its estimated 2024 earnings, and analysts believe the company will grow earnings by 19% annually over the next several years. That's a solid price for a great business with additional upside if it can further monetize its AI ambitions.