Since November 2022, the S&P 500 is up 47% over those 20 months. Its gains in the first half of this year matched those achieved last year. However, the second half of 2024 is off to a rockier start. The market is up less than 2% and at one point even tumbled 5% lower. Investors are reminded that market corrections — and even crashes — can and do happen.
But there is a silver lining: Every bear market is followed by a bull market that wipes away all vestiges of the collapse. For long-term investors who hold on instead of panic selling, you will come out ahead.
It means virtually any time is a good time to invest. The key is to have a long enough investment horizon. So if you have $1,000 to invest, and that money isn’t needed for bills or to be set aside for emergencies, then this is the single best stock to buy today.
Why Are We Covering This?
- Investing is the best way to achieve wealth. Over decades, stocks have outperformed all other asset classes including gold, bonds, real estate and oil. The key has been to own a stock for a minimum of three to five years, but a decade or more is better.
- Warren Buffett once noted, the best time to sell is never. Yet with the market becoming choppy, investors may be worried about putting their money to work in stocks. Since bull markets are typically measured in years while bear markets last for months, it is still a great time to invest.
- If you want to pick up some of the most high upside stocks in the market “on sale,” check out our brand-new “The Next NVIDIA” report that lays out the next megatrends in AI and the companies we’re confident can dominate them.
Welcome to Visa
Payment processor Visa (NYSE:V) needs no introduction as there is probably one of its branded credit cards in your wallet or purse right now. It has 4.5 billion cards in circulation. It processed $3.325 trillion in transactions on its network during its fiscal third quarter, which ended in June. That’s a 7.4% increase from the year ago period.
Although much of the growth came from Europe and Latin America, Visa still grew its U.S. payments by more than 5% from the year-ago period. That is faster than the U.S. economy expanded during the quarter, which was 2.8%, according to the U.S. government’s Bureau of Economic Analysis.
In short, Visa is the biggest payment processor in the world. Rival Mastercard (NYSE:MA), by comparison, has just 3.4 billion cards in circulation. Its gross dollar volume rose to $2.4 trillion. Visa generated $8.9 billion in revenue. Last year, its $32.7 billion in revenue equated to making over $62,000 every single minute.
A Richly Rewarding Investment
Because Visa doesn’t lend money or extend credit, it is shielded from the worst effects of a market collapse. While people may spend less during a recession, limiting transaction growth, downturns are relatively short-term in nature. They last on average just 15 months. Bull markets tend to rampage for years.
Visa stock enjoyed a near 450% total return over the past 10 years surpassing that of the S&P 500 by nearly two-to-one. It has raised its dividend payment at a compounded annual growth rate (CAGR) of 15% for the past five years and nearly 20% over the past decade. The dividend currently yields just under 1% annually.
Yet a $1,000 investment in Visa 10 years ago would be worth almost $5,500 today. It went public in the teeth of the global financial crisis in 2008. That same $1,000 investment made then would be worth over $21,000 today, a better 2,000% total return. It’s why no matter the market, Visa is the single best stock to buy today.
It’s Why Dividend Stocks Are A Portfolio Necessity
While stock market investing beats other asset classes, dividend stocks outperform all stocks over time. In fact, going all the way back to 1930, Hartford Funds discovered stocks that initiated and raised their dividends never had a losing decade.
Our analysts have identified two dividend legends to buy and never sell. 24/7 Wall St. readers can discover both their names immediately, completely free. Just click here right now.
Evolution of a Cashless Society
Visa’s 2023 survey of its global card network found 95% of small businesses planned to go cashless “someday” while 51% said they would do so within two years. The payment processor is on track to process around 230 billion transactions this year. Because of the significant runway for growth as society increasingly transforms into a cashless one, Visa’s position atop the industry gives it a durable, competitive advantage.
Certainly there are headwinds. Not only from the likes of alternative payment providers such as Block‘s (NYSE:SQ) CashApp, PayPal‘s (NASDAQ:PYPL) Venmo, or the big bank’s Zelle app, but also in the growth of cryptocurrency, especially Bitcoin (CRYPTO:BTC).
Yet Visa is responding to these potential threats by evolving its own business. It supports crypto-linked card transactions through a partnership with Crypto.com, offers a Visa-branded debit card for use in making crypto-linked transactions, and offers crypto fraud- and risk-mitigation services. As payments evolve so is Visa, which now has over 65 crypto wallet partners.
Thank you for reading! Have some feedback for us?
Contact the 24/7 Wall St. editorial team.
Latest from 24/7
