In an era of volatile markets and emerging technologies, investors are constantly seeking reliable strategies to secure long-term financial success. Jeremy J. Siegel’s Stocks for the Long Run, a seminal investment guide, lays the foundation for understanding long-term stock market trends and returns. Building on Siegel’s research, this article dives into a selection of high-performing companies—what we call 5StarStocks—with exceptional growth potential and strategic market positioning.
From established tech leaders like Microsoft to rising disruptors such as Uber and ServiceNow, this article provides a well-rounded overview of some of the top stocks to watch right now, highlighting how smart investing and economic principles like comparative advantage can drive long-term portfolio growth.
Microsoft (MSFT): A Tech Titan with Consistent Growth
Microsoft stands tall as a foundational stock for long-term investors, supported by strong financials, a solid dividend history, and pioneering AI initiatives.
Market Performance & Financials
- Stock Price: $411.84
- Market Cap: $3.06 trillion
- EPS Growth: 25% average over the last three quarters
- Projected EPS Growth: 19% in 2024 and 15% in 2025
Despite its high valuation, Microsoft continues to attract investors thanks to its robust earnings, with a 29% YoY growth in Azure’s cloud services powered by AI. It also pays a quarterly dividend of $0.46, marking 16 consecutive years of dividend growth.
Strategic Investments
Notably, Microsoft has made a $1.5 billion investment in G42, a UAE-based AI company, and continues collaborations with OpenAI and IntelePeer, underscoring its leadership in AI and cloud computing.
Ares Management (ARES): Dividend Growth Meets Global Reach
Ares Management offers a compelling investment story grounded in dividend growth and diversified global operations.
Key Financials
- Dividend Growth: From $0.77 to $0.93 in the last year
- Profit Margin: 13.06%
- Return on Equity: 23.37%
- Revenue: $3.63 billion
- Net Income: $453 million
- AUM (2021): $281.5 billion
Expansion Strategy
Ares has been expanding aggressively, most notably acquiring Atlas Crane Service in 2022. The company continues to solidify its presence across credit, private equity, and real estate, operating in the U.S., Europe, and Asia.
Founded in 1997, Ares has earned a reputation as a global alternative investment leader with analyst ratings ranging from “Strong Buy” to “Hold” and a price target of $145.44, suggesting solid growth potential.
Eli Lilly (LLY): A Pharmaceutical Powerhouse on the Rise
Eli Lilly remains a leader in the diversified medical sector, delivering steady returns through drug innovation and strategic acquisitions.
Stock Snapshot
- Buy Point: $800.78
- Market Cap: ~$243.6 billion
- 52-Week Range: $242.71 – $373.50
- EPS Growth: 19% (last quarter)
- Analyst Target: $382.50 (16% upside)
Strategic Moves
Eli Lilly is doubling down on Alzheimer’s research with its investigational drug Donanemab, while its acquisition of Point Biopharma strengthens its cancer treatment pipeline. Despite some regulatory delays, analysts remain confident in the company’s growth trajectory.
Uber Technologies (UBER): From Mobility to Market Leader
Uber is evolving beyond a rideshare company into a diversified tech and logistics powerhouse.
2023 Financial Highlights
- Revenue: $37.3 billion
- Q4 2023 Revenue: $9.9 billion (beat estimates by $174M)
- EPS (Q4): $0.86 vs. $0.45 expected
- S&P 500 Performance: +148% in 2023
Growth Drivers
- 24% increase in trips
- 22% growth in gross bookings
- 30% increase in drivers
- 19 million Uber One subscribers across 25 countries
Uber’s innovations in Uber Eats, advertising, and subscription models have fueled its ascent, backed by $5.4 billion in cash reserves and $768 million in free cash flow. Analysts have revised projections upward more than 20 times in recent months.
ServiceNow (NOW): Cloud Solutions and AI Potential
As a leader in cloud computing and enterprise automation, ServiceNow represents one of the most exciting high-growth stocks in tech.
Financial Overview
- Stock Price: $736.45
- 1-Year Return: +63%
- EPS: $8.42
- Revenue: $8.97 billion
- Gross Margin: 78.59%
- Market Cap: $151 billion
Outlook and Innovation
ServiceNow is poised for further growth through AI integration, global expansion, and a potential stock split in 2024. With operations in over 180 countries and consistent earnings beats, the company is considered a strong breakout candidate by analysts.
Understanding Comparative Advantage in Investing
The principle of comparative advantage helps explain why certain companies thrive in specific markets or sectors. It refers to an entity’s ability to produce a good or service at a lower opportunity cost than its competitors.
Why It Matters
- Trade Efficiency: Promotes specialization and efficient trade between companies or countries
- Investment Strategy: Investors can focus on sectors or companies where they have greater expertise or market insight
- Risk Reduction: Targeted investment based on comparative advantage can lead to higher returns with lower risk
Comparative vs. Absolute Advantage
- Comparative Advantage: Focuses on opportunity cost
- Absolute Advantage: Focuses on productivity or output per resource unit
By applying this principle, investors can identify companies or sectors with enduring strengths—making informed, strategic choices that reflect both global trends and individual strengths.
Conclusion: Building Wealth with 5StarStocks
The companies featured—Microsoft, Ares Management, Eli Lilly, Uber, and ServiceNow—represent diverse but fundamentally strong investment opportunities in the modern market landscape. Whether through AI innovation, dividend growth, healthcare breakthroughs, or digital mobility, each stock offers something unique for the savvy investor.
As highlighted by Jeremy Siegel’s Stocks for the Long Run, long-term success in investing is rooted in understanding market trends, recognizing strategic positioning, and staying the course with well-researched decisions.
By combining these principles with an appreciation of comparative advantage, investors can navigate today’s fast-moving markets with clarity and confidence—unlocking a path to financial success in 2024 and beyond.
