Will a new bull market begin soon? Maybe, but maybe not. But some enticing opportunities await investors regardless of what happens.
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3 Top Stocks to Invest $3,000 in Right Now
Some stocks have prospects that are simply too attractive to ignore. You can find examples across multiple industries. Here are three top stocks to invest $3,000 in right now.
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1. Amazon
The retail sector could continue to face headwinds in 2023. Inflation remains high, and there’s still considerable economic uncertainty. These factors could weigh on Amazon (NASDAQ: AMZN) over the near term. However, it’s the long-term outlook for Amazon that really matters.
Amazon’s cost-cutting initiatives should lead to improved profitability. The company should also be able to again generate strong free cash flow. That’s music to investors’ ears.
E-commerce remains the biggest revenue source for Amazon. Don’t think for a second, though, that there’s no room to grow. In the fourth quarter of 2022, e-commerce accounted for only 14.6% of total U.S. retail sales.
But cloud hosting is Amazon’s biggest profit center — and its greatest growth market. Over the next 10 to 15 years, much of the IT spending that’s currently focused on businesses’ on-premises data centers will move to the cloud, and Amazon Web Services (AWS) stands to be a huge beneficiary of this trend. I think that it’s quite possible that AWS will generate close to 3 times the revenue by the late 2030s that the entire company made last year. This massive growth opportunity makes Amazon a no-brainer stock to buy.
2. Brookfield Infrastructure
If you’re an income investor, I think you absolutely need to have Brookfield Infrastructure (NYSE: BIP) (NYSE: BIPC) on your radar screen. The company offers a dividend yield of close to 4.5% with its limited partnership shares that trade under the BIP ticker. Brookfield Infrastructure has increased its distribution by a compound annual growth rate of roughly 10% since 2009.
Those distributions are highly reliable. Brookfield Infrastructure owns a wide array of infrastructure assets that generate consistent revenue month in and month out. These assets include natural gas pipelines, electricity distribution and transmission lines, rail operations, toll roads, telecom towers, and data centers.
However, you don’t have to be primarily focused on income to like this stock. Brookfield Infrastructure has delivered total returns that trounced the S&P 500 over the last 15 years. I expect it will continue to beat the market.
The company actively recycles its capital, selling lower-growth businesses to invest in higher-growth assets. With major opportunities ahead, including the explosive growth of data and decarbonization initiatives, Brookfield Infrastructure should have ample opportunities to deploy its capital in profitable ways. In my opinion, the current pullback for this dividend stock makes it a screaming buy right now.
3. Vertex Pharmaceuticals
Five in five. That’s the goal for Vertex Pharmaceuticals (NASDAQ: VRTX). CEO Reshma Kewalramani stated in the big biotech’s recent conference call that Vertex hopes to launch new products targeting five disease areas within the next five years.
The first two of those five launches are already in sight. Vertex and its partner, CRISPR Therapeutics, could win regulatory approvals for exa-cel in treating sickle cell disease and transfusion-dependent beta-thalassemia later this year.
Perhaps the most important thing for investors to know about Vertex’s five-in-five goal is that each of the programs represents multibillion-dollar market opportunities. These aren’t pie-in-the-sky, cross-your-fingers pipeline candidates, either. They’re all either already in the regulatory approval process or in late-stage clinical studies.
In the meantime, Vertex is a bona fide cash cow thanks to its monopoly in treating the underlying cause of cystic fibrosis (CF). Also, the company’s growth prospects aren’t limited to its five-in-five programs. Vertex is also evaluating a potential cure for type 1 diabetes that’s in early-stage testing as well as a potential therapy for rare genetic disease alpha-1 antitrypsin deficiency in a phase 2 clinical study.
Three in three
I’ll borrow Vertex’s five-in-five phrase and change it up a little. Amazon, Brookfield Infrastructure, and Vertex Pharmaceuticals present a great “three-in-three” opportunity for long-term investors. Buying $3,000 worth of these three stocks (or $3,000 of each stock) should pay off handsomely — probably even over the next three years.
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John Mackey, former CEO of Whole Foods Market, an Amazon subsidiary, is a member of The Motley Fool’s board of directors. Keith Speights has positions in Amazon.com, Brookfield Infrastructure, Brookfield Infrastructure Partners, and Vertex Pharmaceuticals. The Motley Fool has positions in and recommends Amazon.com, CRISPR Therapeutics, and Vertex Pharmaceuticals. The Motley Fool recommends Brookfield Infrastructure Partners. The Motley Fool has a disclosure policy.