With concerns regarding President Trump’s tariff policies, border policy as well as foreign policies, the economic and geopolitical landscape is experiencing a wave of uncertainty. A volatile landscape like this does not seem the best ground for stocks to thrive.
In this landscape, investors looking for defensive investment options could choose to invest in fundamentally stable mega-cap stocks, Microsoft Corporation (MSFT), Alphabet Inc. (GOOGL) and Johnson & Johnson (JNJ).
Recently, President Donald Trump said that U.S. tariffs on imports from Canada and Mexico “will go forward” when a month-long delay on their implementation expires next week. Aimed at reducing the federal budget deficit and bringing in new jobs for workers, these tariffs could also affect negatively, increasing product prices and reducing consumer confidence.
Additionally, Trump's foreign policy changes regarding the Russia-Ukraine altercation have also started raising concerns. Recently, the President has stated that Ukraine "should have never started the war”, reversing three years of American policy toward Ukraine. This has also raised concerns about China’s claim towards Taiwan, resulting in a heightened state of geopolitical uncertainty.
In such a volatile market condition, mega-cap stocks offer a sense of security and a long-term investment plan. With market caps of more than $200 billion, these stocks are well established within their respective sectors, have successfully retained investors' trust, and have held their ground over the years.
Now, let us dive deep into the fundamentals of three “forever stocks” that investors could buy and hold for decades.
Stock #3: Microsoft Corporation (MSFT)
MSFT develops and supports software, services, devices, and solutions. The company offers a wide range of software and services, including Office, Exchange, SharePoint, Microsoft Teams, LinkedIn, azure, SQL, Visual Studio, System Center, GitHub, PC accessories, and Xbox hardware.
On February 19, MSFT announced Majorana 1, the world’s first quantum chip powered by a new Topological Core architecture. Capable of solving meaningful, industrial-scale problems, the new chip can produce more reliable and scalable qubits. The innovation could enhance the company’s position in the popping quantum computing market.
On the same day, MSFT released Muse, a first-of-its-kind generative AI model, primarily for game development. Coming with the ability to create consistent and diverse gameplay rendered by AI, the release marks a major step toward generative AI models that can empower game creators.
For the fiscal 2025 second quarter that ended December 31, 2024, MSFT’s total revenue increased 12.3% year-over-year to $69.63 billion. Its operating income rose 17.1% from the year-ago value to $31.65 billion. Moreover, the company’s net income and EPS both grew 10.2% from the prior year’s quarter to $24.11 billion and $3.23, respectively.
Analysts expect MSFT’s revenue and EPS for the fiscal 2025 third quarter (ending in March) to increase 10.8% and 9.7% year-over-year to $68.53 billion and $3.23, respectively. In addition, the company surpassed the consensus revenue and EPS estimates in each of the four trailing quarters, which is impressive.
MSFT’s stock has surged marginally over the past year, closing the last trading session at $404.
MSFT’s POWR Ratings reflect its sound fundamentals. The stock has an overall rating of B, translating to a Buy in our proprietary rating system. The POWR Ratings assess stocks by 118 different factors, each with its own weighting.
MSFT has a B grade for Stability, Sentiment, and Quality. Within the B-rated Software – Business industry, it is ranked #15 out of 40 stocks.
In addition to the POWR Rating highlighted above, you can check MSFT’s ratings for Growth, Value, and Momentum here.
Stock #2: Alphabet Inc. (GOOGL)
GOOGL provides various products and platforms, including Android, Chrome devices, Gmail, Google Drive, Google Maps, Google Photos, Google Play, Search, and YouTube. The company functions through three segments: Google Services; Google Cloud; and Other Bets segments.
On February 24, GOOGL announced a major expansion of a strategic partnership with Salesforce, Inc. (CRM), to deliver choice in the models and capabilities businesses use to build and deploy AI-powered agents. The partnership offers flexibility and empowers customers to develop tailored AI solutions that meet their specific needs. This move could enhance GOOGL's position in the ongoing AI race.
On February 20, GOOGL introduced the preview of A4X VMs, powered by NVIDIA GB200 NVL72, a system consisting of 72 NVIDIA Blackwell GPUs and 36 Arm-based NVIDIA Grace CPUs connected via fifth-generation NVIDIA NVLink.
Offering new levels of AI performance and accuracy, the new release by the company could enhance its supercomputing architecture, AI Hypercomputer, significantly advancing its AI portfolio.
For the fiscal 2024 fourth quarter that ended December 31, 2024, GOOGL’s revenues increased 11.8% year-over-year to $96.47 billion. Its operating income rose 30.7% from the year-ago value to $30.97 billion. Also, the company’s net income and EPS grew 28.3% and 31.1% from the prior year’s quarter to $26.54 billion and $2.15, respectively.
Street expects GOOGL's revenue and EPS for the fiscal 2025 first-quarter ending in March to increase 10.9% and 7.1% year-over-year to $89.33 billion and $2.02, respectively. Furthermore, the company has surpassed the consensus EPS estimates in each of the four trailing quarters, which is noteworthy.
Shares of GOOGL have surged 8.1% over the past six months and 25.8% over the past year, closing the last trading session at $179.25.
GOOGL’s POWR Ratings reflect its robust prospects. The stock has an overall rating of B, translating to a Buy in our proprietary rating system.
GOOGL has a B grade for Quality. It is ranked #13 out of 49 stocks within the A-rated Internet industry.
To access GOOGL’s Growth, Sentiment, Stability, Value, and Momentum ratings, click here.
Stock #1: Johnson & Johnson (JNJ)
JNJ engages in the research and development, manufacture, and sale of various products in the healthcare field. The company's offerings include products for various therapeutic areas, electrophysiology products to treat heart rhythm disorders, and circulatory restoration products. Its segments are Innovative Medicine and MedTech.
On January 21, JNJ’s subsidiary, Janssen-Cilag International NV announced the European Commission approval for a Marketing Authorisation(MA) for LAZCLUZE®, in combination with RYBREVANT, for the treatment of adult patients with advanced non-small cell lung cancer with epidermal growth factor receptor exon 19 deletions or exon 21 L858R substitution mutations.
The treatment is expected to extend life by a median of one year or more in patients, marking a significant step forward in the treatment of EGFR-mutated NSCLC. This move could enhance the company’s oncology portfolio.
On the same day, JNJ announced the U.S. FDA approval of a supplemental New Drug Application (sNDA) for SPRAVATO® (esketamine) CIII nasal spray, for adults living with major depressive disorder (MDD) who have had an inadequate response to at least two oral antidepressants.
Marking this as the first and only monotherapy for adults with MDD, the approval could enhance the company’s market presence in the antidepressants market by strengthening its offerings.
For the fiscal 2024 fourth quarter that ended December 29, 2024, JNJ’s sales to customers increased 5.3% year-over-year to $22.52 billion. Its gross profit rose 5.4% from the year-ago value to $15.39 billion. Plus, the company’s net earnings and net earnings per share from continuing operations amounted to $3.43 billion and $1.41, respectively.
The consensus revenue estimate of $21.65 billion for the fiscal 2025 first quarter (ending in March) reflects a year-over-year increase of 1.3%. Its EPS for the period is expected to come in at $2.64. Also, the company surpassed consensus EPS estimates in each of the four trailing quarters.
JNJ’s stock has surged 8.3% over the past nine months to close the last trading session at $163.74.
The stock’s strong fundamentals are mirrored in its POWR Ratings. It has an overall rating of A, which translates to a Strong Buy in our proprietary rating system.
JNJ has an A grade for Stability and a B for Growth, Sentiment, Quality, and Value. Within the Medical - Pharmaceuticals industry, it is ranked #2 out of 152 stocks.
Click here to access JNJ’s Momentum rating.
What To Do Next?
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MSFT shares were unchanged in premarket trading Tuesday. Year-to-date, MSFT has declined -3.96%, versus a 1.90% rise in the benchmark S&P 500 index during the same period.
About the Author: Aritra_Gangopadhyay
Aritra is a financial journalist dedicated to breaking down complex financial topics into simple, actionable insights. Holding a Master’s degree in Economics, he uses his analytical expertise to help investors uncover unique opportunities for long-term success.
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