Investing in only a single stock is not the best strategy. Any one-stock portfolio would lack the necessary diversification to ride out the ups and downs that every stock experiences.
However, if my hand was forced, and I had to choose only one stock to own for the long term, I know which one I would quickly focus on.
If I could only choose one stock, I would want to select a stock that is already executing at a high level. Without doubt, Meta Platforms (NASDAQ: META) is doing exactly that.
Meta's stock has surged to new all-time highs in recent months, bringing the company's market cap to a staggering $1.75 trillion as of this writing. That makes Meta America's sixth-largest company, trailing only Apple, Nvidia, Microsoft, Amazon, and Alphabet. Since the start of 2023, shares of Meta have advanced by about 450%.
As for what has been behind the surge in Meta's stock, a review of the company's earnings per share (EPS) provides answers.
Since 2015, Meta's diluted EPS has skyrocketed from $0.18 to $8.02. That works out to a gain of about 4,300%. Similarly, the company's operating margin -- the percentage of net sales a company converts to operating profit -- is 48.3%. That's close to an all-time high and significantly above its lifetime average of 37.2%.
In short, Meta's fundamentals look terrific. But what's driving these excellent figures?
In the case of Meta, its size is one of its greatest assets. Simply put, the company is a global behemoth. As of its most recent quarter (the three months ending on Dec. 31, 2024), Meta reported a staggering 3.35 billion daily average users (DAUs) across its family of apps, including Facebook, Instagram, and WhatsApp. On average, each one of those users generates $14.25 per quarter in revenue for Meta through ads delivered on the family of app platforms.
Granted, this business model makes Meta dependent on advertising -- a fickle bit of business spending that is often cut back when companies face economic headwinds.
That's why it's best to own Meta for the long term. The stock can be volatile; it has experienced multiple drawdowns of 30% or more. In 2022, shares lost more than 76% of their value.
However, long-term investors have used these drawdowns as buying opportunities. Indeed, an investor who purchased $10,000 worth of Meta shares in January 2023 would now have over $56,000 worth of the stock today.
To sum up, Meta Platforms is a well-run company with excellent fundamentals that also boasts a worldwide user base. Its reliance on advertising makes its stock price volatile; however, long-term investors can use that volatility to their advantage.
Story Continues
And while it is never a sound strategy to put all your eggs in one basket by owning only a single stock in your portfolio, if I were forced to do so, I would strongly consider Meta Platforms as that single stock.
Ever feel like you missed the boat in buying the most successful stocks? Then you’ll want to hear this.
On rare occasions, our expert team of analysts issues a “Double Down” stock recommendation for companies that they think are about to pop. If you’re worried you’ve already missed your chance to invest, now is the best time to buy before it’s too late. And the numbers speak for themselves:
Nvidia: if you invested $1,000 when we doubled down in 2009, you’d have $323,920!*
Apple: if you invested $1,000 when we doubled down in 2008, you’d have $45,851!*
Netflix: if you invested $1,000 when we doubled down in 2004, you’d have $528,808!*
Right now, we’re issuing “Double Down” alerts for three incredible companies, and there may not be another chance like this anytime soon.
*Stock Advisor returns as of February 24, 2025
Randi Zuckerberg, a former director of market development and spokeswoman for Facebook and sister to Meta Platforms CEO Mark Zuckerberg, is a member of The Motley Fool's board of directors. John Mackey, former CEO of Whole Foods Market, an Amazon subsidiary, is a member of The Motley Fool's board of directors. Suzanne Frey, an executive at Alphabet, is a member of The Motley Fool's board of directors. Jake Lerch has positions in Alphabet, Amazon, and Nvidia. The Motley Fool has positions in and recommends Alphabet, Amazon, Apple, Meta Platforms, Microsoft, and Nvidia. The Motley Fool recommends the following options: long January 2026 $395 calls on Microsoft and short January 2026 $405 calls on Microsoft. The Motley Fool has a disclosure policy.
If I Could Only Buy and Hold a Single Stock, This Would Be It was originally published by The Motley Fool
