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There is no single "best" stock for every investor and every situation. The suitability of a stock you might consider for yourself depends upon your goals, investment horizon and risk tolerance, among other factors. However, what works for one portfolio may not be equally suitable for another. The typical way many beginners start is with a broad index ETF as a diversified core, since it spreads exposure across many companies and niches. Individual stocks can then be researched as selective additions to this core.
In this article, we review 10 high-quality companies worth researching as buy-and-hold additions to your core portfolio. We've based our picks on critical factors such as fundamentals, valuation, competitive moats and capital allocation. Our selection reflects market conditions as of late August 2026.
Key Takeaways:
A strong buy-and-hold stock is characterized by a durable moat, consistent earnings, reasonable valuation and a business model that the investor actually understands.
This article covers 10 established companies worth researching for a long-term buy-and-hold approach.
You can gain market exposure to these equities through one or more of the following options available on Bybit: xStocks, Bybit CFD and TradFi Perpetuals.
Buy-and-hold investing is based on holding quality assets — company stocks in our context — through market cycles, instead of attempting to time your entries and exits. Selecting suitable companies for such an investment strategy requires careful evaluation across the following five key dimensions:
Consider the durable competitive advantage, or moat, that protects the company’s market position.
Confirm consistent earnings or revenue growth over time.
Check that the valuation remains reasonable relative to the revenue growth.
Scrutinize the company’s balance sheet strength, since financial stability supports resilience during downturns. It’s not uncommon for the stock market to produce equities that seem to have an excellent moat, rapid growth and a commensurately positive valuation, yet their balance sheet numbers are less-than-desirable.
Examine capital allocation: how a company handles dividends, buybacks and reinvestment reveals a lot about its management’s discipline and strategic focus.
In addition, start with businesses you understand well — ideally, ones whose products you’ve either used or researched extensively. The selected company's revenue model needs to be clear to you. Familiarity with the target company and its niche makes it far easier to follow company developments, conduct research, and track news or analyst coverage over time.
At the same time, familiarity alone doesn’t guarantee investment quality. Even well-known consumer brands can be overvalued, or face structural challenges that aren't obvious to casual observers.
Finally, don’t forget that a buy-and-hold strategy requires ongoing attention and is not a synonym for “buy-and-forget.” Periodically reassessing whether your original investment thesis remains intact for your goals is essential, since company fundamentals, competitive positioning and industry conditions can shift substantially over the holding period.
Sector: Information Technology
A major name among growth stocks, NVIDIA enjoys dominance in the data center AI GPU niche. Its market leader position in this high-growth sector gives it a moat few chipmakers can match. NVIDIA’s CUDA software platform firmly locks developers into its ecosystem. The combination of hardware share and software stickiness supports durable pricing power as AI infrastructure spending continues to grow.
Key numbers to watch: For the quarter ended July 26, 2026 (Q2 fiscal 2027), NVIDIA reported $96.2 billion in revenue, up 106% year-over-year, while Data Center revenue reached $89.0 billion, up 117%, reflecting continued exceptionally strong demand for AI computing infrastructure.
Main risk: NVIDIA remains dependent on a relatively concentrated customer base, so any pullback in capital spending would hit results directly. One direct customer accounted for 16% of Q2 fiscal 2027 revenue, while the company notes that a limited number of direct and indirect customers contribute a significant share of sales.
Sector: Information Technology
Microsoft enjoys a fast-growing cloud business and a near-monopoly in enterprise productivity software, giving it two separate paths to stable earnings. Microsoft Office's dominant position funds steady cash generation, while Azure captures a growing share of cloud infrastructure spending.
Key numbers to watch: Azure and other cloud services revenue grew 43% year-over-year in Q4 fiscal 2026, while Microsoft Cloud revenue reached $59.3 billion for the quarter and $214.4 billion for the full fiscal year, underscoring the scale and continued growth of its cloud business.
Main risk: Microsoft’s AI infrastructure buildout requires enormous capital investment. Following an accounting-related lease reclassification, the company expects roughly $175 billion in capital expenditures for calendar 2026, raising the importance of converting that spending into sustained cloud and AI revenue growth.
Sector: Communication Services
Alphabet's Search business still controls the vast majority of global search volume, while subsidiary YouTube adds a second massive advertising engine. Google Cloud has turned the corner from a cash drain into a margin contributor, which has helped the business to broaden its earnings base beyond advertising.
Key numbers to watch: Alphabet reported $119.8 billion in Q2 2026 revenue, up 24% year-over-year, while Google Cloud revenue surged 82% to $24.8 billion. Cloud operating income also rose to $8.8 billion, from $2.8 billion a year earlier, showing that the segment is becoming an increasingly meaningful profit contributor.
Main risk: Antitrust rulings targeting distribution deals and the company’s dominance in Search could disrupt its moat.
Sector: Consumer Discretionary
Amazon combines its dominant e-commerce ecosystem with two increasingly important high-margin businesses: Amazon Web Services (AWS) and digital advertising. AWS gives the company exposure to continued cloud and AI infrastructure growth, while its advertising business monetizes Amazon's vast base of shoppers and third-party sellers. Together, these businesses provide additional earnings drivers beyond the company's core retail operations.
Key numbers to watch: AWS revenue grew 37% year-over-year to $42.2 billion in Q2 2026, its fastest growth in 18 quarters, while advertising revenue rose 26% to $19.8 billion. Overall operating income increased 43% to $27.5 billion, highlighting the growing contribution from Amazon's higher-margin businesses.
Main risk: Amazon's aggressive spending on AI and data center infrastructure could pressure cash flow if future AWS and AI revenue fails to justify the scale of investment. Trailing 12-month free cash flow fell to an outflow of $7.6 billion in Q2 2026, largely because of higher AI-related capital expenditure.
Sector: Financials
Berkshire's collection of wholly owned subsidiaries across insurance, rail and energy generates steady earnings that are independent of market cycles, while its insurance float provides a permanent, low-cost source of investment capital. This is a key stock to watch for anyone looking to diversify away from the turbulent, shorter-cycled tech sector.
Key numbers to watch: Berkshire generated approximately $13.0 billion in operating earnings in Q2 2026, while its insurance float stood at about $177.5 billion. Its Insurance and Other businesses also held roughly $360 billion in cash, cash equivalents and short-term U.S. Treasury Bills, giving the company substantial financial flexibility for future investments and acquisitions.
Main risk: Berkshire’s enormous cash position that represents over 35% of total market capitalization can become a drag on returns if management struggles to find sufficiently attractive opportunities for capital deployment.
Sector: Healthcare
Operating in the new and fast-growing robotic-assisted surgical health care, Intuitive Surgical, Inc. boasts industry-leading da Vinci systems. The company enjoys a recurring revenue stream tied to procedure volume, rather than one-time equipment sales, which helps smooth out earnings over time. Growing procedure counts each year extend that potential even further.
Key numbers to watch: Q2 2026 revenue rose 19% year-over-year to $2.89 billion, while da Vinci procedure volume grew approximately 15%. The installed base also expanded 12% to 11,710 da Vinci systems, supporting continued growth in instruments, accessories and service revenue.
Main risk: Hospital CapEx cuts — or competitive entrants like Medtronic Hugo™, or Johnson & Johnson OTTAVA™ — could increase the competition in this lucrative niche.
Sector: Healthcare
Eli Lilly sells the same core drug, tirzepatide, under two brand names: Mounjaro® for diabetes, and Zepbound® for weight loss. This gives the Indianapolis-based Big Pharma titan a strong position in two enormous and growing markets. The company also reinvests heavily in research and development (R&D), which funds a pipeline of other new drugs still in testing.
Key numbers to watch: Lilly's revenue grew 48% year-over-year to $23.0 billion in Q2 2026, with Mounjaro and Zepbound together generating approximately $14.8 billion. Following the strong quarter, Lilly raised its full-year 2026 revenue guidance to $85–87 billion.
Main risk: Manufacturing bottlenecks could limit supply, while Medicare price negotiations under the Inflation Reduction Act could negatively affect future pricing.
Sector: Financials
As the largest US bank in terms of assets, JPMorgan combines scale advantages with consistently superior returns on capital. This combination has ensured the banking behemoth's resilience across multiple rate cycles.
Key numbers to watch: JPMorgan reported 29% ROTCE in Q2 2026, or 23% excluding significant items, while net interest income rose 10% year-over-year to $25.6 billion. These figures demonstrate the bank's strong profitability and earnings power at scale.
Main risk: A macro recession could push credit loss provisions higher. If this coincides with falling interest rates, net interest margins may be hit harder than many expect.
Sector: Energy
ExxonMobil's low-cost production base gives it an advantage in weathering oil price swings — a leg up that smaller competitors can’t match. The company also boasts decades of dividend increases, demonstrating disciplined capital management across many market cycles.
Key numbers to watch: ExxonMobil generated $17.2 billion in free cash flow in Q2 2026 and returned $9.4 billion to shareholders through dividends and share repurchases. The company has also increased its annual dividend per share for 43 consecutive years.
Main risk: A sharp fall in crude oil prices — combined with demand erosion from the energy transition to cleaner alternatives — could eventually pressure both cash flow and the corporation’s outstanding dividend record.
Sector: Industrials
Away from the glitz of Big Tech operates Caterpillar, the world’s leader in construction equipment. It’s fair to say that billions of people around the world see the results of the company's presence in the form of buildings, bridges and roads. Its position as the top global manufacturer of construction and mining equipment is reinforced by a massive dealer network that competitors won’t be able to match for many years to come.
Key numbers to watch: Caterpillar's Q2 2026 sales and revenue rose 24% year-over-year to $20.5 billion, while its operating profit margin improved to 20.9%, from 17.3% a year earlier. Strong order rates and a growing backlog also point to continued demand across its major businesses.
Main risk: Cyclical downturns in construction and mining infrastructure spending could shrink Caterpillar’s order backlog.
Stock | Sector | Buy-and-hold thesis | Key risk |
NVDA | Info Tech | AI GPU dominance plus CUDA lock-in | Hyperscaler customer concentration |
MSFT | Info Tech | Productivity monopoly plus cloud growth | High AI CapEx vs. adoption |
GOOGL | Comm Services | Search dominance, improving cloud margins | Antitrust rulings |
AMZN | Consumer Discretionary | E-commerce scale plus AWS and advertising growth | High AI CapEx vs. returns |
BRK.B | Financials | Self-funding conglomerate with huge float | Idle cash drag |
ISRG | Healthcare | Recurring revenue from installed base | Hospital CapEx cuts, competition |
LLY | Healthcare | Tirzepatide franchise plus R&D pipeline | Supply bottlenecks, price controls |
JPM | Financials | Scale, plus superior returns on capital | Recession, margin compression |
XOM | Energy | Low-cost production, dividend discipline | Oil price collapse |
CAT | Industrials | Market leadership, dealer moat | Cyclical spending downturns |
Bybit offers exposure to all of these top stocks and many other equities through three mechanisms: xStocks, Bybit CFD and TradFi Perpetuals.
xStocks provides access to non-leveraged tokenized stocks and ETFs, with tokens backed 1:1 by assets held custodially. The product features no funding or overnight financing costs, making it suitable for longer holding periods.
Bybit CFD offers derivative-based long and short exposure through an MT5 CFD account. Unlike xStocks, these derivatives have overnight financing costs, making them less suitable for long-term holding.
The third product, TradFi Perpetuals, directly utilizes your Bybit Unified Trading Account (UTA). These Perpetuals provide 24/7 long and short exposure, are subject to funding rate fees, and feature ETF exposure to popular index funds like SPY and QQQ.
Note that none of these three Bybit products confer actual ownership of the company via shareholding.
As a long-term stock investor, you might face several key risks:
A major one is company-specific risk: A single business can underperform or fail, regardless of how the broader market performs.
Valuation risk is also critical to consider. Overpaying for a stock erodes future returns, even when the selected company performs well.
Concentration risk may also become an issue if your portfolio holds only a handful of individual stocks — particularly those clustered within the same niche. Such concentration amplifies the impact of any single holding's decline.
Changing business fundamentals pose another threat. Buy-and-hold investing isn’t a passive buy-and-forget decision: long-term investment theses can break over time. Therefore, it’s crucial to keep your pulse on the market in order to avoid missing a deteriorating signal in your stock’s fundamentals.
Investors who use derivatives instead of owning assets directly take on additional risks and holding costs, including leverage, margin requirements, CFD overnight financing and funding fees.
Individual buy-and-hold stocks work best as selective, carefully researched additions to a diversified portfolio. They should complement your core holdings, rather than be viewed as replacements. Bybit offers several ways to gain exposure to the stock market, including xStocks, Bybit CFD and TradFi Perpetuals. Each of these three options is worth researching, as they differ in fees, the nature of exposure and the availability of individual assets.
Disclaimer: This article is for informational purposes only and does not constitute financial or investment advice. Investing involves risk, including potential loss of capital, and past performance does not guarantee future results. |
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