It’s been a rollercoaster ride investing on Wall Street in recent years. The S&P 500 and the Nasdaq Composite have seen significant gains in 2023, yet still lag below their record highs. For those in it for the long run, a dip in the market could mean a golden opportunity to buy. Throughout history, market corrections, bear markets, and crashes have always been followed by a bull market rally, save for the 2022 bear market.
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Investing in the stock market can be daunting, but you don’t need a fortune to start. With online brokerages eliminating minimum deposit requirements and commission fees for common stock trades, even $100 can make a difference.
If you’re ready to invest $100 and are certain this isn’t emergency cash, consider these three stocks that stand out as no-brainer buys right now.
Bank of America: A Steady Performer
Consider investing in money-center giant Bank of America (NYSE: BAC), best known as BofA. Despite the cyclicality associated with bank stocks, they have historically performed well in the long term. Economic expansions usually far exceed recession periods, suggesting BofA will benefit over time.
What makes Bank of America particularly attractive at the moment is its interest rate sensitivity compared to other money-center banks. With the Federal Reserve implementing the steepest rate-hiking cycle in over 40 years, BofA has seen a significant boost in net interest income each quarter.
Additionally, BofA’s steady investments in technology have paid off, with the majority of its customer base now banking digitally. This should lead to improved operating efficiency. At around 10 times forward-year earnings and trading near its book value, BofA stock is attractively priced.
Paramount Global: Adapting to the Changing Landscape
Another stock to consider for your $100 investment is media company Paramount Global (NASDAQ: PARA). Despite challenges in the advertising environment and operating losses from its streaming services, there are reasons to consider purchasing its shares.
Patience is crucial for ad-driven businesses, as economic expansions generally lead to stronger pricing power for advertisers. Additionally, an election year like 2024 often leads to increased ad spending. Paramount’s potential improvement in its streaming segment could serve as a significant catalyst in the year ahead.
Paramount Global and Alibaba: Investment Analysis
Paramount Global, the parent company of Paramount Pictures, has implemented a shrewd strategy to revitalize its financials. This involves raising subscription rates while curbing expenses to steer its business to profitability.
Furthermore, Paramount Global holds ownership of Pluto TV, a dominant ad-supported, free streaming platform. Should the U.S. plunge into a recession, the lure of zero-cost content could become irresistible as exemplified by Pluto TV’s 80 million monthly active users as of March 2023.
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Alibaba’s Upside Amidst Regulatory Risks
The third undeniable stock to consider is China’s premier e-commerce enterprise, Alibaba (NYSE: BABA).
While China’s regulatory scrutiny and geopolitical tensions with the U.S. pose challenges, three compelling reasons emerge for growth and value investors to dismiss these headwinds.
Firstly, Alibaba’s e-commerce platforms, Taobao and Tmall, command nearly 51% of the e-commerce market in China, championing phenomenal growth prospects as the country’s middle class flourishes.
Secondly, the rapid expansion of Alibaba’s cloud services segment, responsible for 34% of China’s cloud infrastructure service spending, presents another avenue for double-digit sales growth.
Finally, despite the regulatory concerns, Alibaba’s historically low valuation, excluding its substantial net cash position, offers shares at a record-low multiple of 5 times forward-year earnings, underscoring the tangible reward potential despite the risks.
Interested in Bank of America?
Before investing, note that Bank of America didn’t make the 10 best stocks list from the Motley Fool Stock Advisor analyst team. This service has outperformed the S&P 500 significantly since 2002*
*Stock Advisor returns as of January 8, 2024
Bank of America is an advertising partner of The Ascent, a Motley Fool company. Sean Williams maintains positions in Bank of America. The Motley Fool has positions in and recommends Bank of America. The Motley Fool recommends Alibaba Group. The Motley Fool has a disclosure policy.