Our new list of best stocks to buy includes a couple returning All-Stars that are still excellent opportunities, plus new picks set to capitalize on big profit trends we're excited about now.
There are five new stocks to buy we're sharing with you today:
- A tech stock the experts wrote off years ago is still one of the most profitable picks out there, and it's ready to double once again.
- The need for new infrastructure is approaching critical mass. Find out the best play for when government funds start flowing.
- A top-performing cannabis pick now gets the benefit of legalization in Canada and the world's most recognizable stock exchange.
- Shifting demographics are creating windfalls in one overlooked sector, and we've got one of the best picks to reap the benefits.
- If you missed Priceline's 4,500% rise over the last dozen years, there's a new online travel leader that may be in for an even bigger rise.
Now for our five latest best stocks to buy now...
Best Stocks to Buy Now No. 1: Another Strong Move from This Desktop Publishing Giant Brings In a $150 Billion Business
Our first pick is a Money Morning All-Star, a tech pick that's already delivered nearly 475% gains since Money Morning Defense and Tech Specialist Michael Robinson first recommended it in June 2013.
The S&P 500, by comparison, has only gained 68% in that time.
While Wall Street was writing Adobe Systems Inc. (Nasdaq: ADBE) off as a desktop publishing dinosaur, Michael correctly saw that its move into cloud computing was going to pay off in a big way.
Now he says Adobe's share price is set to double again in two and a half years.
That's due in part to the $1.68 billion acquisition of Magento Inc. completed in June. But before we get to that, let's look at how attractive this stock was to begin with.
Fortune has named Adobe one of the best companies to work for in each of the past 18 years. Its CEO, Shantanu Narayen, has appeared on Barron's list of the world's best CEOs in each of the last two years.
That's not surprising given that Adobe's sales have been growing at an average annual rate of 20.8% over the last three years. What's even more impressive is that earnings per share (EPS) has grown at more than twice that pace: 52% per year. According to FactSet, Adobe's EPS is projected to grow another 154% by 2021.
On top of that, with a $2.5 billion stock buyback program set to wind down at the end of the year, Adobe announced in May that it would snatch up another $8 billion of its own stock by the end of 2021.
All of that shows that this stock has plenty of pop to offer investors. Now the addition of Magento adds even more reason to be excited.
Magento, an example of what Michael calls a "stealth" company, has quietly built an empire developing software for clients such as Canon Inc. (NYSE ADR: CAJ) and Rosetta Stone Inc. (NYSE: RST) to run their online stores. Through these platforms, Magento handles more than $150 billion in gross merchandise volume per year - almost double the figure for eBay Inc. (Nasdaq: EBAY).
Adobe, of course, still produces the go-to suite of digital artistic tools for consumers and professionals alike. Now, in addition to its successful move into cloud software, it has positioned itself as one of the world's e-commerce leaders.
Combine everything the stock already had in its favor with this move, and Michael sees ADBE doubling once again in as little as 30 months.
"No matter what you're trying to do - build up your retirement account... save up for a boat... or finance your kids' education," he says, "it will only take a few stocks like Adobe to get you there."
Best Stocks to Buy No. 2: This Infrastructure Stock Is Set to Double, and That's Before a Major Catalyst Kicks In
Infrastructure in the United States is a rare issue that garners widespread agreement: Our highways, bridges, and facilities are literally falling to pieces.
A 2017 report card from the American Society of Civil Engineers (ASCE) gave the country's infrastructure a D+ overall. Out of 16 categories we were graded on, only one of them (rail) came out better than a C+.
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This isn't just embarrassing. It's life-threatening.
A total of 56,000 American bridges are structurally deficient. And 15,500 dams are in hazardous condition. Last year there were 240,000 water main breaks, which can contaminate the water supply with debris.
And that's why, as much as politicians have been kicking the infrastructure can down the road, we're nearing the point when they literally cannot delay any longer. The ASCE report put American infrastructure needs at $4.59 trillion by 2025.
Infrastructure spending got a $21.2 billion boost in March's omnibus spending bill. That's a start, but much more will be on the way, no matter what parties control Washington after the midterm elections.
Even before that happens, our next pick has plenty of work to keep it busy.
Construction powerhouse Tutor Perini Corp. (NYSE: TPC) is currently working on projects to expand Newark Liberty International Airport, build a light rail system in Minneapolis, and help with the high-speed rail system in California.
It currently has a backlog of $8 billion worth of contracts to be completed.
FactSet projects a 60% rise in Tutor Perini's earnings per share over the next two years, and reports 100% of analysts rating the stock a "Buy." Analyst price targets go as high as $38 - nearly 100% higher than its current share price.
In other words, Tutor Perini is doing well already and is one of the best infrastructure stocks you can own.
But when governments at the federal, state, and local levels finally turn on the infrastructure spending faucet to make up for decades of neglect, that's when Tutor Perini will be swimming in revenue.
And its shareholders will be raking in the profits.
Money Morning Special Situation Strategist Tim Melvin says buying Tutor Perini means getting a "potential bonanza of profits at a bargain price."
"And last time I checked," he says, "that was a pretty good way to get rich as a stock investor."
Best Stocks to Buy No. 3: After Legalization, Canada's Biggest Weed Grower Will See Profits Soar
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Our next pick is another All-Star, having delivered 178% returns since Money Morning Chief Investment Strategist Keith Fitz-Gerald recommended it last November.
That beats the S&P 500 by 2,531%.
Clearly, Keith's first venture into the legal marijuana industry has been a highly successful one. And just before the Canadian Senate voted overwhelmingly to legalize cannabis last week, the country's biggest grower became the first weed company with a listing on the New York Stock Exchange.
Michael Robinson says this "uplisting" means maximum profit potential ahead for Canopy Growth Corp. (NYSE: CGC), which already stands to reap huge benefits from legalization in Canada.
Canopy specializes in several varieties of cannabis, but its big emphasis recently has been on oils and concentrates, which come with precise doses of THC and CBD that can be dissolved and consumed easily.
In the final quarter of 2017, the company's total revenue more than doubled from a year earlier, while the share that came from oil sales jumped from 14% to 23%.
While Canada and the United States are major growth markets for Canopy, the company also has agreements to export its products to more than a half-dozen countries overseas.
Those export relationships are going to be key as the legal marijuana market expands. According to the Brightfield Group, the market is set to jump from $7.7 billion currently to $31.4 billion by 2021, with non-U.S. markets jumping from a 10% share to a 43% share along the way.
Canopy is already in position to be a key distributor for the global marijuana industry.
In spite of its surge in stock price, Canopy is still just getting started. It has a perfect storm of factors - a booming industry, new market openings, and a well-established brand - to deliver big profits for years to come.
"If you want to make a profit on the booming cannabis sector," Michael Robinson says, "then I suggest jumping on board Canopy, where the opportunities and gains are seemingly endless."
Best Stocks to Buy No. 4: This Real Estate Pick Is Already Delivering Steady Profits, and Its Customer Base Is About to Rise by 60%
The oldest of the baby boomers have passed age 70, beginning a massive demographic shift that comes with significant economic implications.
According to the Census Bureau, the population of Americans over age 65 is expected to grow from nearly 50 million to nearly 80 million by 2035. The elderly share of the population will increase from about 15% to more than 21% in that time.
That means a lot more demand for medical services and elder care.
That's probably why we've seen a string of big healthcare mergers and acquisitions recently, like the recent $9.9 billion acquisition of Envision Healthcare Corp. (NYSE: EVHC) by private equity firm KKR & Co. LP (NYSE: KKR).
The smart money wants to get as big a share of this sector as possible in preparation for the next two or three decades.
While most investors understand that biotech and medical devices are great sectors for this trend, one overlooked sector is real estate: specifically real estate that specializes in senior housing.
One of the best you can buy right now is Senior Housing Properties Trust (Nasdaq: SNH), a real estate investment trust (REIT) with more than 400 properties composed of senior living communities, medical offices, and wellness centers.
Because it's a REIT, it pays out most of its earnings in the form of a dividend. Right now the yield gives you a 10.3% annual return the moment you buy your shares.
That still puts the dividend at just 89% of funds from operations per share at its current pace, meaning it should be safe going forward.
SNH also got the highest possible score from our Money Morning Stock VQScore™ system, flagging it as undervalued and ready to rise.
All that comes before the fact that demand for senior housing is set to rise dramatically.
In other words, this is a stock that's already a great buy, and it's only going to get better every year as demographics are more favorable for it.
As Tim Melvin puts it, following the smart money into this sector is a reliable way to get "very, very rich."
Best Stocks to Buy No. 5: The Next Online Travel Success Story Is Rising in the East
Booking Holdings Inc. (Nasdaq: BKNG), formerly known as Priceline, has been the major success story in online travel. Its stock, which was trading around $48 in 2006, is now worth over $2,100.
But there's another stock, trading around $48 today, that could produce similar returns in the years to come.
That's CTrip.com International Ltd. (Nasdaq ADR: CTRP), China's leader in online travel booking.
CTrip stock is already up 2,177% since it debuted in 2003. But it still has some major factors in its favor.
Already, China is responsible for more outbound tourists than any other country on Earth, with 130 million outbound trips in 2017. The China National Tourism Administration expects that number to pass 200 million by 2020.
According to the International Air Travel Association, China's travel market will pass the United States for the No. 1 spot within the next two decades.
CTrip is more than just an online aggregator. It provides services like 24/7 emergency response for its customers in any destination.
It's even on the verge of providing supersonic flights.
The company has partnered with Boom Supersonic to bring commercial airliners that can travel up to 1,450 miles per hour to China. This will cut many flight times in half, essentially making the world half as big in the process.
The price of a ticket: about the same as a business-class seat on a commercial jet today.
CTrip's "Moneyball"-like approach to management - always deferring to empirical evidence for its executive decisions - has also made the company the subject of a study by Harvard Business School, potentially providing guidance for companies hoping to replicate the booking agency's success in the future.
One company study of telecommuting, conducted with the help of professors from Peking and Stanford Universities, led to a 13.5% increase from workers and a 50% reduction in turnover.
CTrip's EPS rose to $1.09 in 2017, up from $0.58 the year before. That's an 88% jump, and it's projected to nearly triple from there to $3.04 by 2021.
But while tripling profits in four years might seem impressive, even that may be a low estimate. CTrip has beaten analyst expectations in 23 of the last 24 quarters going back to 2012. In the first quarter of this year, the company clobbered expectations, reporting $0.54 EPS compared to a consensus estimate of $0.16.
This is one of the best-run companies in the world, and it's riding a wave of increased travel activity in one of the world's fastest-growing countries.
In short, CTrip may be in a better position than Priceline ever was. Expect its stock price to rise accordingly.
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About the Author
Stephen Mack has been writing about economics and finance since 2011. He contributed material for the best-selling books Aftershock and The Aftershock Investor. He lives in Baltimore, Maryland.