What Makes a Stock Worth Holding Long-Term?
Some investors aim to hold a stock for years — or even decades — but not every company deserves that level of commitment.
👉 What kind of stock is truly worth a long-term, heavy position?
One commonly used method is the PEG + PE approach, which helps assess both valuation and growth potential.
PE (Price-to-Earnings) shows how expensive the stock is right now.
PEG = PE ÷ Profit Growth Rate (%) helps judge if the price is fair based on how fast the company is growing.
📊 PEG < 1 suggests the stock may be undervalued.
📊 PEG > 1 could mean it’s priced too high for its growth rate.
Example:
PE 20 with 40% profit growth → PEG = 0.5 (potentially undervalued)
PE 50 with 30% growth → PEG = 1.67 (potentially overvalued)
This method encourages looking for companies with strong, steady growth at reasonable prices.
🔍 Discussion Time
What key factors help decide whether a stock is worth holding long-term?
Any examples of stocks that turned out to be great (or not-so-great) long-term bets?
👇Share your thoughts and let’s learn from each other’s perspectives.
Disclaimer: Investing carries risk. This is not financial advice. The above content should not be regarded as an offer, recommendation, or solicitation on acquiring or disposing of any financial products, any associated discussions, comments, or posts by author or other users should not be considered as such either. It is solely for general information purpose only, which does not consider your own investment objectives, financial situations or needs. TTM assumes no responsibility or warranty for the accuracy and completeness of the information, investors should do their own research and may seek professional advice before investing.
A good example would be Nvidia $NVIDIA(NVDA)$. It ticks all the boxes in the key factors for my holding the stock long term. CEO Jensen Huang exemplifies strong leadership as he has a visionary approach. That is how he has catapulted Nvidia as the most valuable company in the world with Assets Under Management of over USD 4 Trillion! What an amazing leader! That is why I have invested in Nvidia.
@MillionaireTiger @Tiger_comments @Tiger_SG @TigerStars @CaptainTiger
Examples of US stocks that turned out to be great long-term bets include:
- * $Microsoft(MSFT)$ *: Tech giant with solid financials, expanding cloud and AI capabilities.
- * $NVIDIA Corp(NVDA)$ *: Leader in graphics processing units and artificial intelligence computing.
On the other hand, some not-so-great long-term bets might include companies with:
- *Poor Financial Health*: High debt, declining revenue, or inconsistent profitability.
- *Weak Industry Trends*: Companies in declining industries or with limited growth prospects.
- *Poor Management*: Ineffective leadership or questionable capital allocation decisions.
1. Deep and wide moat - won’t be disrupted by competition they are the entrenched norm, think $Microsoft(MSFT)$.
2. Huge total assessable market - like AI still has a lot more room to grow. Think $NVIDIA(NVDA)$
3. Visionary leadership with strong execution - think Steve Jobs with $Apple(AAPL)$
4. Consistent innovation - think $Taiwan Semiconductor Manufacturing(TSM)$
5. Build to last culture - think Warren Buffet and $Berkshire Hathaway(BRK.B)$
What do you think? [Grin]
However, this method didn’t work out well for BYD. Market leader and is an industry the Chinese government wants to support, and also making inroads into a big market like Indonesia. There is no predicting that byd would slash prices and spark of a potential price war. The fear of a price war did not materialise but the price of byd still remains stuck. I will continue to hold it as it is still the market leader for both car and its superior battery.
Why Singtel, stable growth and is a must have for consumers. Singtel is the main telecom service provider, can say that is must " product" that everyone needs to use. It services from mobile, broadband, clouds to network security etc.
And all Telco in SG buy their bandwidths from Singtel although the licence fees are paid to IDMA.
SATS a flight, ground handing and food providers. As long as the travel demands remain strong, Sats will remain healthy and have stable growth. And it has a 100% stable income by providing food services for Singapore uniform units.
Dividend: Improving
For STE $ST Engineering(S63.SI)$ , its backbone is the Singapore government. Projects from the Government such as providing arms and weapons services and transportation system projects etc. Recently, STE has bagged multiple billion projects from overseas too..such multiple millions contracts from NATO.
PE 50增長30%→PEG=1.67（可能被高估）
這種方法鼓勵尋找具有強勁、穩定的增長，價格合理.
PE（市盈率）顯示該股票目前有多貴。
PEG=PE ÷利潤增長率（%）有助於根據公司的增長速度來判斷價格是否公平。
📊PEG<1表明該股可能被低估。
📊PEG>1可能意味着它的定價相對於其增長率來說太高了。