Costco, Amazon, and Uber stand out as solid long-term investments.
As the S&P 500 approaches record highs and shows a price-to-earnings ratio that’s quite high compared to historical levels, investors might want to exercise caution. It can be tempting to invest in popular growth stocks, but remember, they’re not always reliable in a downturn.
Instead, focusing on resilient companies that can weather economic storms is crucial. Here are three stocks I think exemplify this: Costco, Amazon, and Uber.
1. Costco
Costco has several reasons solidifying its status as a dependable investment. First, it uses its size to negotiate lower prices, allowing for bulk sales at discounts.
Secondly, it’s interesting to note that most of Costco’s earnings come from high-margin membership fees, so the company can sell products at very small margins.
Finally, Costco’s influence and pricing power keep increasing as it continues to open more locations and expand added services for its members.
Costco has shown steady growth by attracting new members while keeping renewal rates high. Between 2020 and 2025, its member count increased significantly, as did renewal rates and the number of warehouses.
Even after a membership fee hike in 2024, Costco plans to keep this growth trajectory by opening additional warehouses in 2026.
Analysts predict that from fiscal 2025 to 2028, Costco’s sales and earnings per share will grow at substantial rates, justifying its current high valuation despite a steep price-to-earnings ratio.
2. Amazon
Amazon, a powerhouse in e-commerce and cloud services, brings several strengths to the table. Primarily, its profits largely stem from its Amazon Web Services (AWS) segment, which supports its low-margin retail business.
Secondly, with over 240 million Prime subscribers, Amazon has established a strong customer base, creating a significant competitive advantage.
Lastly, Amazon is advancing its high-margin advertising services, which could become a significant revenue stream alongside AWS.
Growth in the generative AI sector should also boost AWS in the coming years, further enhancing Amazon’s position. Analysts foresee solid growth in revenue and EPS for the company, suggesting it remains attractively valued for future prospects.
3. Uber
Uber, the leading ride-hailing platform, has expanded significantly, currently serving a vast number of monthly active consumers. This growth has outpaced many smaller competitors, largely due to its aggressive strategies and service bundling.
Over the last quarter alone, Uber gained millions of new subscribers, reflecting its increasing market presence.
Uber has also improved its operations by cutting costs and optimizing its focus, which has led to profitability in recent years.
Moving forward, analysts expect solid revenue and EBITDA growth for Uber, which still appears fairly priced given its adjusted earnings. If you’re in the market for a sustainable growth stock, Uber seems to fit the bill nicely.
