along with S&P 500 Index The index recently hit all-time highs and we can officially declare that we are in a bull market. While this is exciting news, it doesn’t change the blueprint for success for long-term investors. The plan is still to pick stocks to hold for a while, stocks that perform well in good times and remain stable in bad times.
For investors looking for this type of company, let’s consider two excellent candidates: Merck (NYSE:MRK) and Pfeiffer (NYSE:FVRR)Read on to learn why these companies are poised to deliver strong returns over the next 10 years.
1. Merck & Co.
Merck has long relied on Keytruda to drive sales growth. Keytruda has received dozens of indications globally to treat various cancers. The drug became the world’s best-selling drug in 2023, a distinction it should retain. Unfortunately, Keytruda’s patent protection is set to expire in 2028.
Can Merck survive this ordeal and continue to deliver reliable results? The answer seems to be yes. The drugmaker has already begun preparations for its post-Keytruda program. Approval is currently awaiting for a treatment that looks destined to become a new treatment. heavy bomb: sotatercept, a potential drug for the treatment of pulmonary arterial hypertension (PAH).
Sotatercept’s mechanism of action is different from existing PAH therapies by targeting the underlying cause of the disease. While Merck acquired Sotatercept through acquisitions, it also relies on products developed in-house, such as the highly promising MK-0616. This potential drug is currently in a Phase 3 study to treat hypercholesterolemia (high cholesterol in the blood). .
MK-0616 has shown excellent medical results in early-stage studies and may be the first oral drug approved to treat hypercholesterolemia (other drugs are usually given by infusion, which is a big plus for patients). less attractive option). Some analysts believe combined peak annual sales of MK-0616 and sotatercept could exceed $10 billion.
That’s not enough to replace Keytruda’s more than $20 billion in annual sales, but it’s a start. The company has a pipeline full of other promising drug candidates, including a subcutaneous version of Keytruda. In my opinion, even if Merck’s sales decline following its win despite facing a patent cliff, the company should be able to recover for much of the next decade thanks to a solid underlying business and a rich pipeline. and generate solid financial results and stock market performance.
Merck is also strong dividend stocks. The company has increased its dividend by 40% over the past five years, and its yield is 2.58%, which is higher than the S&P 500 average of 1.47%. Choosing to reinvest the dividends in Merck is a good idea and should last the next 10 years.
Fiverr operates a platform that helps connect freelance workers and experts in various industries with individuals and businesses who want to hire them. The technology company has underperformed over the past 12 months. Part of the reason is the impact of the epidemic. Fiverr’s business became more popular early in the pandemic, but that ride ended harshly.
In the third quarter of 2023, Fiverr’s revenue was US$92.5 million, an annual growth rate of 12.1%. While that’s better than the revenue growth reported for much of last year, it’s still well below the highs seen early in the pandemic.
The good news, however, is that Fiverr is making progress toward profitability. The company has been implementing cost-cutting measures that appear to be paying off. In the period, the company reported net income of $0.07 per share, compared with a net loss of $0.31 per share in the year-ago period. Fiverr’s earnings should help boost its results. In fact, the company’s stock price has surged over the past three months.
No one knows whether the momentum will continue this year, but the company’s long-term prospects look attractive. The gig economy is on the rise. More and more people are choosing freelancing, either part-time or full-time, in part because it offers a lot of flexibility. Businesses also like hiring freelance workers because it’s cheaper and faster than hiring regular employees.
Fiverr is a leader in its field. The company’s platform benefits from network effects. As more freelance workers join its site, it becomes more attractive to businesses, and vice versa. Fiverr believes the addressable market is worth $247 billion. The company doesn’t need to capture everything – even 1% of the total will help significantly boost its sales and stock price.
In my opinion, Fiverr is well positioned to achieve this goal over the next decade.
Should you invest $1,000 in Merck right now?
Before buying Merck stock, consider the following factors:
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The bull market is coming: Two stocks worth buying and holding for 10 years Originally published by The Motley Fool