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3 Stocks You Can Buy and Hold Forever

It’s not wrong to have strict criteria in place when selecting companies to invest in for the long term. After all, if you intend to park your money for years and still enjoy a good night’s sleep, these companies should have certain key attributes that make them attractive for long-term investment. Not many businesses make the cut, but for those that do, it’s worth taking a second look at them.

Some aspects that I look for are companies that possess a strong competitive moat and are market leaders within their respective industries. Ideally, they should have a long track record of growing their revenue, net profit, and cash flows while also possessing a good runway for future growth. Finally, they should show themselves to be resilient to crises such as the current COVID-19 pandemic.

After filtering out a whole bunch of companies, here are three stocks you can confidently buy and hold forever.

Image source: Getty Images.

PayPal

PayPal (NASDAQ:PYPL) is a major player in the online payments and money transfer industry. The pandemic has accelerated the shift to online communications and working and studying from home, and also pushed more people to use e-commerce and online payments as lockdowns continue. The company is a major beneficiary of this shift as it experienced the strongest growth in total payment volume and revenue in its history for the third quarter.

Total payment volume was up 36% year over year to hit $247 billion, lifting net revenue by 25% year over year to $5.5 billion. There was a surge in net new active accounts for the quarter, up 55% year over year to 15.2 million. Before this stellar performance, PayPal had already displayed steady and consistent growth over the years. Net revenue grew from $9.2 billion in 2015 to $17.8 billion in 2019, while net income doubled from $1.2 billion to $2.5 billion over the same period.

The company is not standing still but continues to advance on strategic initiatives to grow its reach. It expanded its “buy now, pay later” service in the U.S. and U.K., thereby helping merchants to capture more transactions without additional risk while enabling customers to make purchases with interest-free installments. PayPal also introduced its Venmo Credit Card in partnership with Visa (NYSE:V) and announced a new check-cashing feature for customers of its digital wallet, making the service more convenient and fuss-free for them. 

Nike

One of the largest sports footwear and apparel companies in the world, Nike (NYSE:NKE), has shown itself to be remarkably resilient during this pandemic. The company is renowned for its innovative footwear such as the Vaporfly and Alphafly Next% that enhance athletes’ performance during a competition. For its fiscal 2021 first-half earnings, the company reported a surprising 4% year-over-year rise in revenue to $21.8 billion, while net income increased by 12% year over year to $2.8 billion. Of note was Nike’s digital sales momentum, where digital sales jumped 84% year over year with triple-digit year-over-year increases recorded in North America. Nike’s digital strategy is bearing fruit and promises a long runway of continued growth for the business.

The company is not slowing down its product launches even with the pandemic raging. John Donahoe, CEO of Nike, talked about the new launches of LeBron XVIII and Kyrie 7 during the quarter that met with an enthusiastic response. And Nike’s latest release, the Mercurial Vapor 14 boot, promises to allow athletes to make sharp turns without losing their balance. 

Nike recently hiked its quarterly dividend by 12% year over year to $0.275 per share, making this the company’s 19th consecutive year of dividend increases. This move brings it ever closer to becoming a Dividend Aristocrat.

Tractor Supply Company

Tractor Supply Company (NASDAQ:TSCO), the largest rural lifestyle retailer in the U.S. with a total of 1,904 stores in 49 states, has continued to post strong growth despite the downturn. Net sales for the third quarter of 2020 climbed 31.4% year over year while comparable store sales jumped 26.8% year over year. Net income surged by 56% year over year as the pandemic caused more customers to focus on the care of their homes, land, and animals, driving demand up for the company’s products.

Even before the crisis, Tractor Supply Company was already growing steadily. From 2015 to 2019, sales rose every single year without fail, going from $6.2 billion to $8.4 billion, while net income climbed from $410.4 million to $562.3 million. Dividends declared also climbed in tandem with net income, increasing from $0.76 in 2015 to $1.36 in 2019. The company has a strong track record of growing its store count, at around 10% compound annual growth rate over the last 20 years. 

The company’s “Life Out Here” strategy focuses on five pillars: Customers, digitalization, execution, team members, and total shareholder return. This strategy promises to continue to drive growth for the company as it entrenches itself as the go-to place for rural and farm equipment. Operating in a highly fragmented market, Tractor Supply Company sees a total addressable market opportunity of $110 billion, of which it has just a 10% market share, implying significant room for further market share capture. Besides, the company has also identified opportunities for new store growth to take the store count to 2,500 eventually. 



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Aave and Chainlink hit new highs as Bitcoin price fights to hold $32K

Bitcoin (BTC) price opened the weekend trapped within the $33,500 to $32,000 range but at the time of writing the digital asset is struggling to hold above $32,000. 

A few analysts have warned that the recent price loss of momentum may be a sign of ‘institutional exhaustion’ as selling pressure from Asia has increased since Jan. 19.

Despite Bitcoin’s current downtrend, some institutional investors are sticking to their prediction that BTC price will reach $100,000 before the end of 2021. This suggests that institutions are buoyed by rising investor sentiment and the new proposals for a Bitcoin ETF.

BTC/USDT 4-hour chart. Source: TradingView

While Bitcoin still faces resistance around the $33,000 level, on-chain analyst Willy Woo sees one potentially positive development for BTC. Woo said that the Bitcoin Spent Output Profit Ratio (SOPR), a metric that shows the profit ratio of BTC by dividing the price sold by the price paid, had “a touchdown”.

According to Woo there was a:

“Full on-chain SOPR reset. Coins moving between investors per hour (24h MA) no longer carry profit on average. To push SOPR lower, investors would have to be willing to sell at a loss.”

Bitcoin adjusted SOPR. Source: Glassnode

Woo also suggested that investors are less likely to sell at a loss, an early signal that Bitcoin could be close to finding a bottom.

Altcoins and DeFi tokens soar

DeFi tokens and altcoins continued to forge their own path as Bitcoin searched for support. Polkadot (DOT), AAVE, Curve DAO Token (CRV) and Sushiswap (SUSHI) all rallied roughly 5% to 7%.

The surge in the price of many DeFi-related tokens has in large part been the result of an increase in DEX activity. Data from Dune Analytics shows monthly DEX volumes have increased since July 2020 and currently the total value locked in DeFi is at $23.89 billion.

Monthly DEX volume by project. Source: Dune Analytics

Chainlink (LINK) continued its strong rally, setting a new all-time high at $25.50 and surpassing Litecoin (LTC) in terms of total market cap to become the seventh-largest project listed on CoinMarketCap. Aave price also broke to a new all-time high at $229.39 and the total value locked in the platform is $3.44 billion.

The overall cryptocurrency market cap now stands at $936.8 billion and Bitcoin’s dominance rate is 63.5%.



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What happens to the brain on sudden impact? Egg yolks could hold the answer

A rotational deceleration experiment with egg yolk, using an egg scrambler and measuring the soft matter deformation, to find possible answers about concussions.

A growing number of professional football players have been diagnosed with a neurodegenerative disease called chronic traumatic encephalopathy (CTE), likely the result of suffering repeated concussions or similar repetitive brain trauma over the course of their careers. It’s also common in other high-contact sports like boxing, Muay Thai, kickboxing, and ice hockey. We might find clues about the underlying physics by studying the deformation of egg yolks, according to a new paper published in The Physics of Fluids. This in turn could one day lead to better prevention of such trauma.

Egg yolk submerged in liquid egg white encased in a hard shell is an example of what physicists call “soft matter in a liquid environment.” Other examples include the red blood cells that flow through our circulatory systems and our brains, surrounded by cerebrospinal fluid (CBR) inside a hard skull.  How much a type of soft matter deforms in response to external impacts is a key feature, according to Villanova University physicist Qianhong Wu and his co-authors on this latest study. They point to red blood cells as an example. It’s the ability of red blood cells to change shape under stress (“erythrocyte deformability”) that lets them squeeze through tiny capillaries, for instance, and also triggers the spleen to remove red blood cells whose size, shape, and overall deformability have been too greatly altered.

In the case of traumatic brain injury, it is linked to how much the brain deforms in response to impact. The precise cause of CTE is still a matter of ongoing research, but the prevailing theory holds that repetitive brain trauma can damage blood vessels in the brain, causing inflammation and the growth of clumps of a protein called Tau. Eventually those clumps spread throughout the brain killing off brain cells. Those suffering from CTE often experience memory loss, depression, and in severe cases, dementia, among other symptoms.

Prior studies have shown that deformation of soft matter in a liquid environment occurs in response to sudden changes in the fluid field, such as shear flow or a sudden change of the flow pathway. Wu et al. were interested in the specific case of soft matter in a liquid environment that is also enclosed in a rigid container—like the yolk of an egg, surrounded by liquid egg white, all encased in a shell. They wondered if it was possible to break the yolk without breaking the shell, since it’s the case with most concussions that the brain can be damaged without cracking the skull.

To answer that question, Wu et al. set up a simple preliminary experiment with a Golden Goose Egg Scrambler, a novel kitchen device that enables users to scramble an egg right in the shell. Wu’s team applied rotational forces to scramble the egg and were intrigued by how the egg yolk deformed and broke while the shell remained intact. That inspired them to conduct additional experiments to glean insight into the fundamental flow physics behind the effect.

They purchased fresh eggs from a local grocery store, removed the yolks and egg whites, and then placed them in a transparent rigid container, the better to monitor the deformation by recording the entire process with high-speed cameras. They built two separate apparatus. One administered so-called “translational impact”—i.e., striking the container directly—via a small hammer falling from a vertical guide rail (see Fig 1A in gallery), with a spring at the bottom enabling the container to move vertically. They used an accelerometer to measure the container’s acceleration.

For the second setup (see Fig 1B in gallery), they connected the container to an electric motor to study two types of rotational impact: accelerating rotational impact and decelerating rotational impact (i.e., when the outer contained is speeding up or slowing down as it rotates). They also peeled off the membranes surrounding the fresh yolks and suspended them in petri dishes filled with water, the better to study how those membranes, too, respond to stress.

Wu et al. were somewhat surprised to find that, in the case of translational impact, there was almost no deformation of the yolk. Instead, the entire container (and its contents) moved as a single rigid body. In the case of accelerating rotational impact, the team found that the yolk would start out in a spherical shape and then begin to stretch horizontally to form an ellipsoid. The yolk could maintain a stable ellipsoid shape for several minutes if the angular velocity was kept constant.

The most intriguing results occurred in the case of decelerating rotational impact. Here, the yolk began deforming significantly almost immediately, expanding horizontally and increasing its radius at the center—sufficient deformation to severely damage the yolk under sustained stress.

“We suspect that rotational, especially decelerational rotational, impact is more harmful to brain matter.”

To make sure this wasn’t primarily an effect of the yolk as a biomaterial, Wu et al. conducted the same experiment with synthesized soft capsules submerged in a calcium lactate solution, enclosed by a thin membrane of calcium alginate. They got similar results, confirming that “the dominant mechanism leading to the deformation of soft matter in a liquid environment is a result of mechanical forces instead of biological responses,” they wrote.

Based on this, “We suspect that rotational, especially decelerational rotational, impact is more harmful to brain matter,” said Wu, and that centrifugal force likely plays a critical role. “The large deformation of brain matter during this process induces the stretch of neurons and causes the damage.” This could explain why a boxer can get knocked out by a sharp blow to the chin. “Considering the chin is the farthest point from the neck, hitting on the chin could cause the highest rotational acceleration/deceleration of the head,” the authors concluded.

“Critical thinking, along with simple experiments within the kitchen, led to a series of systematic studies to examine the mechanisms that cause egg yolk deformation,” Wu said of the implications of their findings. “We hope to apply the lessons learned from it to the study of brain biomechanics as well as other physical processes that involve soft capsules in a liquid environment, such as red blood cells.”

DOI: Physics of Fluids, 2021. 10.1063/5.0035314  (About DOIs).

Listing image by Ji Lang/Qianhong Wu

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Olympics 2021: Japan and IOC determined to hold Tokyo Games despite cancellation rumors

The Japanese government also said on Friday that it is determined the Games will go ahead following an unconfirmed report that a cancellation might be imminent.

On Friday, the Times of London, citing an unnamed senior member of the ruling coalition, reported that Japanese authorities had privately concluded that the Olympics could not proceed due to the ongoing pandemic. CNN has not independently verified this report, which officials have refuted

“Some news reports circulating today are claiming that the government of Japan has privately concluded that the Tokyo Olympics will have to be canceled because of the coronavirus,” said the statement from the IOC.

“This is categorically untrue … All parties involved are working together to prepare for a successful Games this summer.”

In a statement, the Tokyo 2020 organizers said that Prime Minister Yoshihide Suga had expressed to them his determination to hold the Games, and that meetings were ongoing to ensure that they could go ahead while implementing thorough infection countermeasures and other precautions due to the pandemic.

“All our delivery partners including the national government, the Tokyo Metropolitan Government, Tokyo 2020 Organizing Committee, the IOC and the IPC are fully focused on hosting the Games this summer,” the statement said. “We hope that daily life can return to normal as soon as possible, and we will continue to make every effort to prepare for a safe and secure Games.”

Speaking in parliament Friday morning, Suga said the Games “will be a symbol of humanity overcoming the novel coronavirus, and a chance to showcase Japan’s reconstruction from the devastating (2011) earthquake and tsunami to the world.”

“We are determined to work closely together with the Tokyo Metropolitan Government, the Tokyo 2020 Organizing Committee, and the IOC to realize a safe and secure Olympics,” Suga said.

Other Olympic officials were also quick to deny the claims made by the Times.

“Unfortunately, I need to address unfounded rumors that Tokyo Games will be canceled, rumors that only create more anxiety for the athletes in our sports,” Australian Olympic Committee CEO Matt Carroll told reporters Friday. “The Tokyo Games are on. The flames will be lit on the 23rd of July 2021. This has been just reconfirmed again by the Japanese Prime Minister this afternoon.”

In a thread on Twitter, Canadian Olympic chief David Shoemaker said his team was “unaware of any decision taken by the Japanese government as is being reported.”

“The Canadian Olympic Committee has confidence that the Games can be staged safely and successfully given what has been learned in sport over the last several months and the emphasis the IOC and Tokyo 2020 Organizing Committee have placed on Covid-19 countermeasures,” he said. “We continue in our preparation to participate at Tokyo 2020 with a focus on the health and safety of our athletes, their families, and their communities.”

Saturday marks six months until the postponed Games are due to begin.

CNN’s Aleks Klosok contributed to this report.

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Olympics 2021: Japan determined to hold Tokyo Games organizers say despite cancellation rumors

On Friday, the Times of London, citing an unnamed senior member of the ruling coalition, reported that Japanese authorities had privately concluded that the Olympics could not proceed due to the ongoing pandemic. CNN has not independently verified this report, which officials in Tokyo were quick to refute.

In a statement, the Tokyo 2020 organizers said that Prime Minister Yoshihide Suga had expressed to them his determination to hold the Games, and that meetings were ongoing to ensure that they could go ahead while implementing thorough infection countermeasures and other precautions due to the pandemic.

“All our delivery partners including the national government, the Tokyo Metropolitan Government, Tokyo 2020 Organizing Committee, the IOC and the IPC are fully focused on hosting the Games this summer,” the statement said. “We hope that daily life can return to normal as soon as possible, and we will continue to make every effort to prepare for a safe and secure Games.”

Speaking in parliament Friday morning, Suga said the Games “will be a symbol of humanity overcoming the novel coronavirus, and a chance to showcase Japan’s reconstruction from the devastating (2011) earthquake and tsunami to the world.”

“We are determined to work closely together with the Tokyo Metropolitan Government, the Tokyo 2020 Organizing Committee, and the IOC to realize a safe and secure Olympics,” Suga said.

Other Olympic officials were also quick to deny the claims made by the Times.

“Unfortunately, I need to address unfounded rumors that Tokyo Games will be canceled, rumors that only create more anxiety for the athletes in our sports,” Australian Olympic Committee CEO Matt Carroll told reporters Friday. “The Tokyo Games are on. The flames will be lit on the 23rd of July 2021. This has been just reconfirmed again by the Japanese Prime Minister this afternoon.”

In a thread on Twitter, Canadian Olympic chief David Shoemaker said his team was “unaware of any decision taken by the Japanese government as is being reported.”

“The Canadian Olympic Committee has confidence that the Games can be staged safely and successfully given what has been learned in sport over the last several months and the emphasis the IOC and Tokyo 2020 Organizing Committee have placed on Covid-19 countermeasures,” he said. “We continue in our preparation to participate at Tokyo 2020 with a focus on the health and safety of our athletes, their families, and their communities.”

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