Key Points

• Trump's tariff announcement back in April sent many stocks crashing, and it turned out to be a great buying opportunity.

• Shares of Robinhood Markets, Rocket Lab, and Opendoor Technologies have soared in recent weeks and months.

• These 10 stocks could mint the next wave of millionaires ›

When U.S. President Donald Trump announced a raft of tariffs back in April, he referred to it as "Liberation Day" for the country. What it ended up being was a blow for many stocks, reminiscent of the COVID lows that occurred back in March 2020. Like buying stocks amid that panic, investors who bought back in April have enjoyed some fantastic returns.

Three stocks that have been among the biggest winners since the Liberation Day tariffs were announced are Robinhood Markets (NASDAQ: HOOD), Rocket Lab Corporation (NASDAQ: RKLB), and Opendoor Technologies (NASDAQ: OPEN). Here's a look at how they've performed and whether they are still good buys. The following returns are as of the close on Aug. 4.

Where to invest $1,000 right now? Our analyst team just revealed what they believe are the 10 best stocks to buy right now. Learn More »

Robinhood Markets: Up 152%

Fintech stock Robinhood fell to less than $40 a share shortly after Liberation Day. But as tariffs were paused and negotiations have been taking place, investor sentiment has rebounded, and shares of the popular trading platform have soared since then.

Robinhood's trading platform is popular with retail investors, and it's often a good gauge of just how much excitement is in the stock market. It has also been experiencing some terrific growth due to that bullishness.

On July 30, the company reported second-quarter results, and revenue rose 45% year over year, totaling $989 million. Its net income also more than doubled to $386 million. The company has launched tokenization, which Chief Executive Officer Vlad Tenev calls "the biggest innovation our industry has seen in the past decade." It's currently only available in Europe, but it lets investors hold stock tokens via the blockchain, giving investors greater access to the markets with no commissions.

Robinhood's focus on innovating and catering to retail investors makes it a compelling growth stock to own. It is expensive, however, trading at more than 50 times trailing earnings. But for the growth potential it possesses, the premium may be justifiable. If you're willing to buy and hold for years, it may not be too late to buy the stock.

Rocket Lab: Up 145%

In early April, Rocket Lab stock was trading below $20; as of Monday's close, it was closing in on $45. Rocket Lab is in the business of sending rockets into space, with 68 launches of its Electron rocket under its belt already. A big catalyst may still be waiting in the wings if Rocket Lab's larger Neutron rocket makes a successful debut later this year. That larger rocket can take on bigger payloads and result in greater growth opportunities and missions for the company in the future.

News of tariffs may have worried investors that inflation might rise, which could result in higher interest rates. This would be bad news for money-losing businesses like Rocket Lab that are likely going to need to raise a lot of cash to expand operations. The company incurred a net loss of more than $190 million last year, and it burned through $49 million in its day-to-day operations.

Rocket Lab is a bit of a risky buy, but if you're willing to hang on amid its early growth stages, it could still have a lot more upside in the long run.

Opendoor Technologies: Up 144%

Opendoor is an even riskier stock than Rocket Lab. It's in the business of buying and selling houses. It helps sellers quickly sell their homes, allowing them to avoid the hassles of dealing with listings and showings, which can take months. Opendoor is effectively hoping to flip houses for a profit, and it may need to make upgrades and repairs before putting them on the market.

It's a capital-intensive business, which is why it is also likely to need many cash infusions. Its shares were trading at about $1 on Liberation Day. While they continued to fall after April, they have skyrocketed a staggering 300% in just the past month in what's a great example of how overly excited retail investors have become of late with highly risky stocks.

Opendoor, unfortunately, is largely a meme stock -- and other companies that tried the home-flipping business have flopped. Its gross profit margins are low, which makes it difficult to see the company obtaining a path to profitability anytime soon. Last year, it incurred a net loss of $392 million on sales totaling $5.2 billion. And with its business dependent on a strong housing market, it's not an ideal investment to hold at a time when there's a lot of uncertainty about the economy. This is one stock you may want to avoid as the risk is incredibly high.

Where to invest $1,000 right now

When our analyst team has a stock tip, it can pay to listen. After all, Stock Advisor’s total average return is 1,026%* — a market-crushing outperformance compared to 180% for the S&P 500.

They just revealed what they believe are the 10 best stocks for investors to buy right now, available when you join Stock Advisor.

See the stocks »

*Stock Advisor returns as of August 4, 2025

David Jagielski has no position in any of the stocks mentioned. The Motley Fool has positions in and recommends Rocket Lab. The Motley Fool has a disclosure policy.

Key Points

• These stocks have all been raising their payouts for decades.

• They pay between 4.5% and 4.9% in dividends.

• They have solid financials, which can enable them to continue paying and growing their dividends in the future.

• These 10 stocks could mint the next wave of millionaires ›

Dividend growth stocks can be great long-term investments to put into any portfolio. If a company grows its dividend on a regular basis, that can help ensure that inflation doesn't diminish the value of the payout over time. And the longer you hang on, the higher your dividend income becomes.

Dividends increases are by no means a guarantee, and that's why it's important to focus on quality stocks. Three solid dividend stocks that you may want to consider loading up on today include Target (NYSE: TGT), T. Rowe Price Group (NASDAQ: TROW), and Chevron (NYSE: CVX). Not only do these stocks offer high yields in excess of 4%, but they have also grown their payouts over the years, have strong financials, and they look incredibly cheap right now.

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1. Target

Retail giant Target has been struggling with generating much growth this year as consumers cut back on discretionary spending amid economic challenges. But despite the headwinds, the company's financials aren't all that bad. For the period ended May 3, Target's net sales declined by just 3%, to $23.8 billion. And its net earnings actually improved by 10%, to more than $1 billion, as the company has been cutting costs.

Shares of Target have been under pressure this year as investors brace for continued struggles from the retailer. But while it may not be a great growth stock to own right now, Target remains a dependable option for dividend investors. It yields 4.5%, and the company raised its dividend by just under 2% this year, extending its streak of increases to 54 consecutive years.

At an incredibly low price-to-earnings multiple of only 11, Target can be a great value buy today. The business may not be experiencing strong growth, but with a low payout ratio of just 49%, it can make for a great dividend stock to buy and hold.

2. T. Rowe Price Group

Global investment firm T. Rowe Price is another solid dividend stock to add to your portfolio today. Year to date, it's down around 6%, but its overall performance has been steady.

During the first six months of the year, the company's net revenue totaled $3.5 billion, which was virtually unchanged from a year ago. Rising costs did, however, chip away at its bottom line, which was down 6%, with earnings totaling just under $1 billion over the past two quarters.

The stock yields 4.9%, and T. Rowe has increased its dividend for 39 consecutive years. In February, it announced it was increasing its dividend by more than 2%. Its payout ratio is modest at 56% of earnings, leaving plenty of room for the company to continue making more rate hikes for the foreseeable future.

Trading at less than 12 times earnings, this is another cheap dividend growth stock worth buying right now.

3. Chevron

Rounding out this list of high-yielding dividend growth stocks is oil and gas giant Chevron. It pays 4.5%, as it also provides investors with a terrific source of recurring cash flow. While there is volatility that comes with investing in this sector, Chevron is a leading player in it, making it one of the safer options for dividend investors to consider. Amid a myriad of economic cycles and challenges, it has remained a solid dividend growth stock -- Chevron has raised its payout for 38 straight years.

The company has experienced volatility this year due to falling oil prices. Over the past six months, its revenue totaled $92.4 billion, which was down 7% year over year. And its adjusted earnings fell by 32% to $6.9 billion. But its cash flow from operations totaled $13.8 billion, which was still considerably higher than how much it paid out in dividends -- $5.9 billion.

There will be fluctuations in earnings for Chevron, but with the company growing its exposure in the industry, including its recent acquisition of Hess, which has a strong portfolio of assets in Guyana, this is a continually growing business that investors can rely on for the long haul.

Chevron's stock trades at 18 times its estimated future earnings (based on analyst expectations). By comparison, the average stock on the S&P 500 (SNPINDEX: ^GSPC) trades at a forward earnings multiple of 24. For an industry leader, Chevron's valuation looks incredibly cheap.

Where to invest $1,000 right now

When our analyst team has a stock tip, it can pay to listen. After all, Stock Advisor’s total average return is 1,026%* — a market-crushing outperformance compared to 180% for the S&P 500.

They just revealed what they believe are the 10 best stocks for investors to buy right now, available when you join Stock Advisor.

See the stocks »

*Stock Advisor returns as of August 4, 2025

David Jagielski has no position in any of the stocks mentioned. The Motley Fool has positions in and recommends Chevron, T. Rowe Price Group, and Target. The Motley Fool has a disclosure policy.

Key Points

• Tesla's top line was down 12% last quarter, and its growth rate has been declining in recent years.

• Rising competition and macroeconomic conditions are weighing on its near-term growth prospects.

• The stock trades at a high premium, but management remains bullish on its future.

• These 10 stocks could mint the next wave of millionaires ›

Electric vehicle (EV) and technology company Tesla (NASDAQ: TSLA) is one of the largest businesses in the world, with its valuation right around $1 trillion today. And this is even as the stock is down 21% this year as of July 30.

Investor sentiment has become increasingly bearish on the business, and its latest earnings numbers didn't do anything to help that. With its recent results looking unimpressive, the stock may again come under pressure in the days and weeks to come.

Where to invest $1,000 right now? Our analyst team just revealed what they believe are the 10 best stocks to buy right now. Learn More »

Could now be a good time to add Tesla to your portfolio?

Tesla's problems summed up in a single chart

Investors have long been excited about Tesla's prospects and CEO Elon Musk's vision. From EVs to robots, the company has been evolving into a much larger business over the years. And if you're a believer in its potential, it's hard not to like Tesla as a long-term investment.

But there's also no denying that its growth faces question marks, especially as more competitors emerge in the EV market, particularly from China, where lower prices can squeeze Tesla's margins. The following chart shows that the threat is not just a hypothetical one, either. Tesla's growth rate has fallen drastically in recent years.

TSLA Operating Revenue (Quarterly YoY Growth) data by YCharts

Not only was quarterly revenue totaling $22.5 billion down by 12% in the company's most recent quarter (which ended in June), but the company's net income also fell by 16% to $1.2 billion. Tesla's results came in short of what analysts were expecting on both the top and bottom lines, leading to a drop in its share price after the earnings report.

Big promises and a big valuation

Tesla's recent results weren't great, but the carrot for investors is what may lie ahead for the business. These were some of the rosier -- if vague -- projections for the business from Tesla's recent earnings call:

• Unsupervised full self-driving will be available in "certain geographies" by the end of the year.
• Autonomous ride-hailing services will be available "in probably half the population of the U.S.," also by the end of this year.
• The Optimus version three humanoid robot will be in production next year and "it will be the biggest product ever," according to Musk, who's known for bold predictions.

Any one of these three claims becoming true could help rally Tesla's stock, which arguably needs a catalyst right now. The problem, however, is that high expectations are also baked into the stock, as it trades at around 160 times its analyst-estimated future earnings.

The bar is high for Tesla, and if it falls short of its promises, that could lead to a further decline for the stock, especially given that its recent results haven't exactly been stellar.

Should you buy Tesla stock today?

Tesla has been an exciting growth stock to own for years, and it has generated fantastic returns for investors. Although it hasn't been doing great recently, the stock is still up over 200% in five years. If Musk's vision for his company comes true, investing in Tesla stock could end up being really smart.

However, with the stock trading at such a high premium, I'd hold off on investing in it. When you're paying such a high price, you're leaving yourself with little to no margin of safety should things not go as planned. Tesla's a good stock to put on a watch list, but I wouldn't rush out to buy it right now.

Don’t miss this second chance at a potentially lucrative opportunity

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 $461,294!*
• Apple: if you invested $1,000 when we doubled down in 2008, you’d have $39,405!*
• Netflix: if you invested $1,000 when we doubled down in 2004, you’d have $625,254!*

Right now, we’re issuing “Double Down” alerts for three incredible companies, available when you join Stock Advisor, and there may not be another chance like this anytime soon.

See the 3 stocks »

*Stock Advisor returns as of July 29, 2025

David Jagielski has no position in any of the stocks mentioned. The Motley Fool has positions in and recommends Tesla. The Motley Fool has a disclosure policy.

Key Points

• Kraft is reportedly looking at splitting up its grocery business.

• One entity may focus on sauces and spreads, while the other would include processed meats and cheeses.

• 10 stocks we like better than Kraft Heinz ›

Warren Buffett's Berkshire Hathaway (NYSE: BRK.A)(NYSE: BRK.B) holds many prominent household names in its portfolio. But not all of them have been doing well in recent years. A great example of that is Kraft Heinz (NASDAQ: KHC). Despite being a big name in the food industry, it has been a brutal investment to hold -- its shares are down 17% over the past five years.

The business isn't doing well, growth is stagnant, and investors are worried about the future as consumers pivot to healthier food choices. And the company is reportedly considering a breakup of its business. Here's why that could be a good thing for investors.

Where to invest $1,000 right now? Our analyst team just revealed what they believe are the 10 best stocks to buy right now. Learn More »

Kraft Heinz to split its business?

According to The Wall Street Journal, Kraft is looking at spinning off a sizable chunk of its business, which would be worth around $20 billion. Currently, the stock's total market cap is approximately $34 billion. While the details are still not exactly known as to which brands might be in which business, the company is reportedly looking to have one business that focuses on spreads and sauces, while the other is likely to include processed meats, cheeses, and other core products.

It could take weeks before details are sorted out and there's also the possibility that a breakup doesn't end up happening. But with the stock and company performing so poorly in recent years, a shake-up could be in order. The company's sauces and spreads, for instance, which are staples in households around the world, may have better growth potential than a business that's focused on processed food, which has been associated with health risks.

The company has not been going in the right direction

Kraft's top line hasn't given investors much reason to be optimistic. While it's been relatively steady in recent years, at around $26 billion in annual revenue, that's not terribly exciting for growth investors, especially given that many of the company's brands are synonymous with less-than-healthy eating.

KHC Revenue (Annual) data by YCharts

Forward-looking investors know that this downward trend may persist in the future as consumers eat healthier. And while the stock offers a high dividend yield of 5.5% today, that may not be enough of a reason to own it, especially if the stock's losses more than offset the dividend income. Plus, the danger is that if the company's top and bottom lines decline in the future, the dividend may not prove to be sustainable.

For both dividend and growth investors, there are plenty of concerns around Kraft these days, which explain why the food stock hasn't been doing well.

Should you buy Kraft Heinz stock today?

Kraft's stock looks cheap, trading at 13 times its trailing earnings. But with many question marks around its business, the safest option is to take a wait-and-see approach. A spinoff could open up a good opportunity for investors, by splitting off segments and brands that may have more potential to grow in the long run.

However, until the full details come out about a spinoff and what brands each business may have, it would be difficult to assess just how attractive the opportunity might be. And you would still need to wait until after the spinoff takes place and then invest in the specific business you want, to ensure you aren't still having a position in the entire company as it stands today.

For now, I'd hold off on buying Kraft's stock. It appears evident that a change in strategy may be inevitable, whether it's a breakup of the business or some other move, and you may be better off waiting before making any investment decision on Kraft.

Should you invest $1,000 in Kraft Heinz right now?

Before you buy stock in Kraft Heinz, consider this:

The Motley Fool Stock Advisor analyst team just identified what they believe are the 10 best stocks for investors to buy now… and Kraft Heinz wasn’t one of them. The 10 stocks that made the cut could produce monster returns in the coming years.

Consider when Netflix made this list on December 17, 2004... if you invested $1,000 at the time of our recommendation, you’d have $636,628!* Or when Nvidia made this list on April 15, 2005... if you invested $1,000 at the time of our recommendation, you’d have $1,063,471!*

Now, it’s worth noting Stock Advisor’s total average return is 1,041% — a market-crushing outperformance compared to 183% for the S&P 500. Don’t miss out on the latest top 10 list, available when you join Stock Advisor.

See the 10 stocks »

*Stock Advisor returns as of July 21, 2025

David Jagielski has no position in any of the stocks mentioned. The Motley Fool has positions in and recommends Berkshire Hathaway. The Motley Fool recommends Kraft Heinz. The Motley Fool has a disclosure policy.

Key Points

• Obesity is linked to many diseases, including cancer.

• A recent study found that tumors in mice shrank after they were administered tirzepatide.

• It could take years for GLP-1 drugs to obtain regulatory approval as cancer-related treatments.

• 10 stocks we like better than Eli Lilly ›

GLP-1 agonist drugs like Zepbound and Mounjaro from drugmaker Eli Lilly (NYSE: LLY) continue to rise in popularity as people are hopeful about the weight loss they can achieve with their help. But a growing number of studies suggest that they could be useful in indications beyond diabetes and weight loss.

One particularly intriguing study involves cancer, and it reveals a potential role for GLP-1 agonists in that area of healthcare. If GLP-1 drugs end up obtaining approval as treatments related to oncology, that could unlock a massive new sales growth opportunity for them. That could make a stock like Eli Lilly an even better buy than it is today.

Where to invest $1,000 right now? Our analyst team just revealed what they believe are the 10 best stocks to buy right now. Continue »

Study finds tumors shrank in mice with the help of tirzepatide

Previous studies have shown that when people shed weight, they reduce their risks of developing many illnesses, among them, cancer. But a recent study presented at the Endocrine Society's annual meeting found that GLP-1 agonists could have a more direct impact: They may also reduce the size of breast cancer tumors.

The study was modest in scope and not on human patients: Its subjects were 16 mice. Those mice that received injections of tirzepatide (the active ingredient in both Zepbound and Mounjaro) for 16 weeks lost around 20% of their weight, which was comparable to the weight loss that humans achieve while on the drug. And their tumors shrank by around that percentage as well. "Researchers found that tumor volume was significantly correlated with body weight," reported ScienceDaily.

But even though these results are promising, they are very preliminary. It would take years of studies on humans before a GLP-1 drug could conceivably obtain a label expansion for use in treating any type of cancer. However, there is hope that GLP-1 drugs can do more than just help with diabetes and weight reduction. Regulators did approve tirzepatide for the treatment of obstructive sleep apnea last year. And another study found that it can help reduce the risk of heart failure.

As more research is done on GLP-1 drugs, the number of indications they can treat may grow significantly. And if tirzepatide is able to help treat cancer, it could make this already massive drug a sales behemoth for Eli Lilly.

Business has been booming for Eli Lilly, and more growth is still ahead

Eli Lilly has already been performing incredibly well, thanks in large part to its highly successful GLP-1 drugs. In the first three months of 2025, its sales soared by 45% year over year to $12.7 billion. Zepbound and Mounjaro combined to make up $6.2 billion of that tally.

And what's exciting is that these drugs are still in their early growth stages. That's a big reason why Eli Lilly stock trades at a hefty premium of 65 times its trailing earnings. Its 5-year price-to-earnings growth (PEG) multiple of 1.2 indicates, however, that it may not be that expensive relative to its medium-term growth potential.

Eli Lilly stock is a no-brainer buy

Although the stock may not look cheap, Eli Lilly could be among the best long-term investments you can add to your portfolio today. If tirzepatide racks up more indications and Eli Lilly's already approved drugs reach greater numbers of people, its sales and profits are likely to rise in the years ahead.

This year, the stock is up a modest 4% as the hype around it appears to have cooled. But if you're in it for the long haul, it would be hard to go wrong with Eli Lilly. It may just be one of the best growth stocks in the healthcare sector.

Should you invest $1,000 in Eli Lilly right now?

Before you buy stock in Eli Lilly, consider this:

The Motley Fool Stock Advisor analyst team just identified what they believe are the 10 best stocks for investors to buy now… and Eli Lilly wasn’t one of them. The 10 stocks that made the cut could produce monster returns in the coming years.

Consider when Netflix made this list on December 17, 2004... if you invested $1,000 at the time of our recommendation, you’d have $636,628!* Or when Nvidia made this list on April 15, 2005... if you invested $1,000 at the time of our recommendation, you’d have $1,063,471!*

Now, it’s worth noting Stock Advisor’s total average return is 1,041% — a market-crushing outperformance compared to 183% for the S&P 500. Don’t miss out on the latest top 10 list, available when you join Stock Advisor.

See the 10 stocks »

*Stock Advisor returns as of July 21, 2025

David Jagielski has no position in any of the stocks mentioned. The Motley Fool has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy.

Key Points

• A buy-and-hold strategy can be a great way to grow your portfolio while also avoiding the temptation to chase trends and risky stocks.

• The S&P 500 is at record highs, and while it has historically averaged double-digit returns, investors may want to brace for the possibility of lower returns in the future.

• If you don't think you're on track to meet your investing goals, you may want to consider investing more money or focusing on growth stocks.

• 10 stocks we like better than SPDR S&P 500 ETF Trust ›

For not only years, but decades, tracking the S&P 500 has been a reliable way to generate significant stock gains. Since the index tracks the best stocks on the U.S. markets, it offers a great low-risk way to ensure you're positioned for long-term growth.

But what if you invested a lump sum of $25,000 into an exchange-traded fund (ETF) that tracks the S&P 500, such as the SPDR S&P 500 ETF (NYSEMKT: SPY), and simply held on for 25 years? Could that be enough to make you wealthy and allow you to retire comfortably? Let's take a look.

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How much could your portfolio be worth after 25 years?

A buy-and-hold strategy can be a good way to ensure your portfolio rises in value. Sometimes, just leaving your portfolio alone can be the best thing you can do for your future. The temptation to chase the latest trends or hot stocks can end up doing more harm than good and derail your investment goals and objectives.

If you have a diverse portfolio or if you are invested in the SPDR S&P 500 ETF, a set-it-and-forget-it approach can be a great one to consider deploying. Over time, your investment should rise in value, though there's no guarantee stocks will rise or be up when you need the money. The variable that can have the most significant effect on your overall returns is unfortunately the one that is also nearly impossible to predict: your average annual return.

And with the S&P 500 around all-time highs right now, it may be wise to assume that its average returns from here on out may trend a bit lower than its historical average of around 10%. Here's how a $25,000 investment in the SPDR S&P 500 ETF might look like after a period of 25 years, if the average annual return is between 7% and 9%.

Year	7% Growth	8% Growth	9% Growth
5	$35,064	$36,733	$38,466
10	$49,179	$53,973	$59,184
15	$68,976	$79,304	$91,062
20	$96,742	$116,524	$140,110
25	$135,686	$171,212	$215,577

Calculations and table by author.

A $25,000 investment would grow significantly over the years under this scenario, but with potentially below-average returns, you're not likely to end up with a boatload of money to consider yourself rich, or enough to retire with after 25 years. Your investment might end up growing to more than a couple of hundred thousand dollars and strengthen your overall financial position, but if your goal is to end up wealthy, i.e., having a portfolio worth over $1 million, then this strategy may not be sufficient to get you there.

What you can do if you don't think you're on track to hit your goals

If you're worried you may not reach your investing goals, there are things you can do to try to achieve better results.

Investing more money, even if it's on a monthly basis, can be a way to slowly pad your portfolio's balance over time, and allow more money to be compounded over the years. And the more you invest, the quicker that your gains will accumulate.

If that's not an option, what you may also want to consider is focusing more on growth stocks, rather than simply mirroring the market. By investing in tech stocks or companies with promising growth prospects, you may have better chances of outperforming the market and achieving better-than-average returns.

This can involve more research and be more time-consuming, but it's an example of where picking individual stocks or simply focusing on ETFs that track growth stocks can be a better option than mirroring the S&P 500. It adds more risk into the equation, but the payoff can be worthwhile in the end.

Regardless of what approach you decide to take, it's a good idea to revisit your portfolio on a regular basis to see how you're doing and if you need to recalibrate and adjust your holdings.

Should you invest $1,000 in SPDR S&P 500 ETF Trust right now?

Before you buy stock in SPDR S&P 500 ETF Trust, consider this:

The Motley Fool Stock Advisor analyst team just identified what they believe are the 10 best stocks for investors to buy now… and SPDR S&P 500 ETF Trust wasn’t one of them. The 10 stocks that made the cut could produce monster returns in the coming years.

Consider when Netflix made this list on December 17, 2004... if you invested $1,000 at the time of our recommendation, you’d have $652,133!* Or when Nvidia made this list on April 15, 2005... if you invested $1,000 at the time of our recommendation, you’d have $1,056,790!*

Now, it’s worth noting Stock Advisor’s total average return is 1,048% — a market-crushing outperformance compared to 180% for the S&P 500. Don’t miss out on the latest top 10 list, available when you join Stock Advisor.

See the 10 stocks »

*Stock Advisor returns as of July 15, 2025

David Jagielski has no position in any of the stocks mentioned. The Motley Fool has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy.

Key Points

• A fund such as SPDR S&P 500 ETF can be a good default investing option for all types of investors.

• By tracking the S&P 500 index, you can confidently grow your portfolio while keeping your risks relatively low over the long haul.

• 10 stocks we like better than SPDR S&P 500 ETF Trust ›

When you think about investing for the long term and creating a portfolio worth over $1 million, you may think it's too difficult to do or that it might require a lot of money. But if you have many years to go before you retire, then a slow-and-steady approach can work, where your contributions can be more modest. Through the effects of compounding, they can result in a significant portfolio balance later on.

If you have 34 investing years to go before you retire, it's possible to create a portfolio worth $1 million by saving just $10 per day and without having to take on significant risks along the way. Here's how you can accomplish that.

Where to invest $1,000 right now? Our analyst team just revealed what they believe are the 10 best stocks to buy right now. Continue »

Invest in a fund that tracks the S&P 500

The S&P 500 index is a collection of the leading 500 companies on U.S. exchanges. It allows you to gain broad exposure to the overall market as it includes stocks from a wide range of sectors and industries. The breadth and depth of the index effectively make it a good gauge of the overall stock market and how it is performing.

There are many exchange-traded funds (ETFs) which enable you to mirror and track the index. A popular one is the SPDR S&P 500 ETF (NYSEMKT: SPY). With a low expense ratio of 0.0945%, the fees that the fund charges aren't significant, and they won't prevent you from earning a great return. Historically, the S&P 500 has grown by an average of 10% per year. Mixed in to that are some bad years, but over the long haul, tracking the index has been an effective and easy way for investors to grow their wealth.

Invest regularly and watch that balance grow

You don't have to actually invest every day for this strategy to work. Instead, you can pool your daily savings and invest every week or perhaps every month. The goal is to make the process consistent but also not feel like a chore to the point where it may be difficult to keep up with it. If you're setting aside $10 per day to invest in stocks, that's the equivalent of $70 per week.

Let's assume that you decide to go with investing that money every week. If the SPY ETF grows by an average of 10% per year, here's how your portfolio balance might look after a period of 30 years.

Year	10% Growth Rate
30	$693,942
31	$770,683
32	$855,486
33	$949,199
34	$1,052,759
35	$1,167,198

Calculations and table by author.

You can see that by year 34, your balance would grow to more than $1 million under these assumptions. Your actual returns, however, will vary, and that will affect the size of your portfolio. But setting aside just $10 per day can be a way to set yourself up for significant gains in the long run. This is why investing for the long term can make it easy to minimize your risk while enabling you to build up a large portfolio balance.

Even if you're not familiar with investing or don't know what to invest in, putting money on a regular basis into an S&P 500 ETF such as SPY can be a good option. It'll grow your portfolio steadily and allow you to benefit from the market's overall growth. Rather than trying to beat the S&P 500 and pick individual stocks like many fund managers struggle to do, you can simply mirror it, and that can set you up for success.

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*Stock Advisor returns as of July 7, 2025

David Jagielski has no position in any of the stocks mentioned. The Motley Fool has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy.

Key Points

• Meta Platforms has recently created a new Meta Superintelligence Labs division to focus on AI.

• It's been spending heavily on artificial intelligence, recently investing $14 billion in privately held Scale AI.

• Meta has already been burning through a lot of cash via its metaverse business unit, Reality Labs.

• These 10 stocks could mint the next wave of millionaires ›

Meta Platforms (NASDAQ: META) is going big on artificial intelligence (AI). It has been investing and hiring more staff to take advantage of opportunities related to AI. Recently, it unveiled its newest division: Meta Superintelligence Labs, also known as MSL.

MSL is going to be home to its AI efforts, as the company shows investors the seriousness of its focus on developing next-gen AI technologies. This comes after it recently announced a significant investment into another AI company.

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Will MSL help grow the business and send Meta's stock soaring, or prove to be just another money pit?

A big growth opportunity, or another cash-burning business unit?

Meta is going big on AI, and that was already evident even before it announced the launch of a new division. Previously, the company announced plans to create a stand-alone app for its chatbot, Meta AI, which has been incorporated into its existing social media platforms. It has also announced a $14 billion investment into Scale AI and in doing so it also brought on the company's founder and CEO, Alex Wang, to help lead Meta's AI business.

AI is undoubtedly a huge opportunity for Meta and other tech giants. But it has also been a money pit, with the payoff not always being clear to insiders or investors. Last year, research company Gartner predicted that 30% of generative AI projects would end up abandoned by the end of 2025 due to multiple factors, including rising costs and a lack of clear value for businesses.

Meta has been aggressive when it comes to pursuing growth opportunities, regardless of the costs. It began reporting on its Reality Labs division a few years ago, which focuses on the metaverse. The division routinely incurs operating losses in the billions each quarter, as that venture struggles to prove its worth. But with hugely popular apps (including WhatsApp, Instagram, and Facebook) and a ton of ad revenue, the overall company has still generated nearly $67 billion in earnings over the trailing 12 months.

However, whether MSL follows the same fate will likely be the burning question for investors that determines which direction the social media stock goes from here on out.

Why focusing on AI could be a great move for Meta

Although Meta will likely spend a lot of cash on this new division, I think the move makes much more sense than the metaverse, and it may even be a profitable venture.

Using headsets for the metaverse may not be all that practical if you want to stay connected for multiple hours, and glasses may be easier to wear but they can also come with other challenges -- namely, privacy. With AI, however, since it can be incorporated into any part of a business, such as enhancing Meta's ad business and improving the user experience on its social media networks. There are many more viable ways for investments into AI to pay off for Meta in the long run.

A huge advantage for the company is its billions of monthly active users, which give it a lot of data it can train an AI model on. The biggest challenge for many companies making AI models is accessing the necessary data to make them effective and useful. With Meta having a plethora of data on its social media platforms, it has a big advantage over other tech companies in this regard. It may still need to spend money to access data, but its costs may be lower in comparison to other businesses that are developing chatbots and training AI.

Meta AI already reaches 1 billion users across all of the company's applications each month. The company looks to be in a great starting point to build out its AI business, which can hopefully lead to significant profit growth later on.

Why I'd hold off on buying Meta Platforms for the moment

Meta has some exciting potential in AI, but without a clearer strategy of what it plans to do with AI and how much of a payoff there will be from it, I'd suggest holding off on investing in the company just yet. My preference would be to see it wind down Reality Labs and just focus on this new division. Potentially having multiple cash-burning units in its operations could hurt its cash flow and profits for the foreseeable future.

AI is an intriguing growth opportunity, but investors may want to take a wait-and-see approach with the company for now, to make sure its strategy is sound and will pay off for the business in the long haul. For now, that isn't evident, which is why I'd wait on the sidelines for the time being.

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*Stock Advisor returns as of July 7, 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. David Jagielski has no position in any of the stocks mentioned. The Motley Fool has positions in and recommends Meta Platforms. The Motley Fool recommends Gartner. The Motley Fool has a disclosure policy.

Key Points

• Salesforce's CEO Marc Benioff says that artificial intelligence is now doing between 30% to 50% of the work at his company.

• It's a bold claim, and one that may come with heightened expectations for the business.

• Salesforce's recent numbers haven't looked all that impressive, with its sales growth in single digits.

Artificial intelligence (AI) has the potential to revolutionize companies and industries across the board. And one marketing company that has been investing heavily into AI agents is Salesforce (NYSE: CRM). CEO Marc Benioff is extremely excited about the potential for its Agentforce platform to automate tasks and help add efficiency for businesses, making it easier for them to connect with their customers through AI.

Recently, Benioff made a startling claim: Between 30% and 50% of the work at Salesforce is now down via AI. While that's an impressive statement to make, here's why I'd hold off on investing in the stock.

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Benioff makes a big claim, but will the results back it up?

If a company says that close to 50% of its work is now done by AI, my first expectation would be to see its financials improve -- significantly. And that's what investors should be looking for when Salesforce reports its latest earnings numbers, which should be around late August or early September.

While Benioff says this added efficiency now allows workers to focus on "higher-value work," then at the very least, the company's growth rate should accelerate if that's the case. By doing more meaningful work, that should presumably mean that it may be winning over more customers in the process; otherwise, what would it be all for?

Investors should exercise some skepticism with these types of claims because they can be convenient to make and sound impressive, but if they aren't backed up by stronger financials, then it can be hard to really substantiate them. And the problem is Benioff in the past has often been dismissive of other companies' AI capabilities while boasting about his own company's Agentforce platform. In the past, for example, he has referred to Microsoft's Copilot as the latest iteration of its Clippy assistant, which drew the ire of many users decades ago.

Benioff has been a great promoter and marketer of Salesforce, but CEOs can sometimes hype up their businesses a bit too much. Despite its investments into AI, Salesforce has delivered just single digit revenue growth in its most recent quarter (which ended on April 30), with sales rising by 8% to $9.8 billion -- that's slower than the 11% growth rate it achieved a year earlier.

Investors aren't buying the hype

For all the excitement Benioff has about his company and Agentforce, investors don't appear to be sharing that same enthusiasm. As of Tuesday's close, the tech stock has fallen by more than 18% since the start of the year. While it's not near its 52-week low of $230 just yet, investor sentiment has been souring on the stock, which may be attributable to its low growth rate and concerns of a slowing economy due to trade wars. If the economy slows down, companies may scale back on marketing expenditures and investments into AI.

Benioff's latest claim also may set high expectations for the business when it goes to report earnings. The stock already trades at more than 40 times its trailing earnings, and a growth rate in the single digits likely isn't going to impress investors. For Salesforce to prove that AI is really transforming its business, investors should expect to see a drastically improved top or bottom line, or at least a very strong guidance.

A wait-and-see approach makes sense with Salesforce

Salesforce's CEO talks a good game but until the company backs it up with some stronger financials to help make its valuation look more justifiable, I'd hold off on investing in the stock today. The danger is that when expectations are set so high, it can make it difficult for the business to meet them. I'm always wary of CEOs who pump up their businesses so much, as that can set their stocks up for declines later on, especially if reality doesn't line up with those rosy claims and projections.

Should you invest $1,000 in Salesforce right now?

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*Stock Advisor returns as of June 30, 2025

David Jagielski has no position in any of the stocks mentioned. The Motley Fool has positions in and recommends Microsoft and Salesforce. 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.

Key Points

• The S&P 500 is at record levels after generating positive returns through the first half of the year.

• Historically, single-digit positive returns haven't been uncommon for the broad index.

At the midpoint of the year, the S&P 500 is up around 6%. A few months ago, investors were bracing for the worst amid the threat of tariffs and trade wars. The sentiment improved significantly since then as there's much more bullishness in the markets these days, and many stocks have been performing exceptionally well.

Does a good start like this suggest that 2025 will be a good year for the market? Is the S&P 500 likely to continue rallying in the latter half of the year? Here's what the historical data says.

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Positive single-digit returns aren't all that uncommon, but they are a recent exception

I looked at S&P 500 data going back the past 25 years and found that in 11 of those years, the broad index was up in positive territory by the end of the first half. I excluded double-digit gains to focus simply on performances where the market was doing well but perhaps not taking off.

What's notable, however, is just how volatile the markets have been in recent years. For example, in five of the past six years, the S&P 500 was either up or down by double digits after six months.

Year	S&P 500 Return by End of June
2024	+14.5%
2023	+15.9%
2022	-20.6%
2021	+14.4%
2020	-3.8%
2019	+17.4%

Calculations and table by author. Source: Google Finance.

This year has been a volatile one, but in terms of percentage gains, it looks relatively stable by comparison. The last time the market was up by just single digits at the halfway point was back in 2018 when the S&P 500 rose by less than 2%.

Will the market rally in the second half?

Now, let's pivot to the years with single-digit gains through the first half and look at how the S&P 500 performed in the second half.

On average, the S&P 500 rose by 4.6% in the second half after posting a positive single-digit return in the first half of the year.

Year	First-Half Return	Second-Half Return
2018	1.7%	-7.8%
2017	8.2%	10.3%
2016	2.7%	6.7%
2015	0.2%	-0.9%
2014	6.1%	5%
2012	8.3%	4.7%
2011	5%	-4.8%
2009	1.8%	21.3%
2007	6%	-2.3%
2006	1.8%	11.7%
2004	2.6%	6.2%

Calculations and table by author. Source: Google Finance.

Overall, the data suggests a positive trend for the markets, which could lead to further gains ahead. However, that doesn't mean that it's a given by any means.

Every year is different, and 2025 is not shaping up to be a typical one. In just six months, the S&P 500 has gone from being deep into negative territory to now being up nearly 6% for the year. Investor sentiment has gone from despair and fear to optimism and excitement. I wouldn't expect anything less than more volatility and unpredictability in the second half of this year.

^SPX data by YCharts.

Should you stay invested in the market?

Regardless of whether you think the S&P 500 is going to go up or down over the next six months, it has generally been a great idea to remain invested in stocks over the long haul. The S&P 500, which tracks the top 500 stocks on U.S. exchanges, has averaged annual gains of around 10% per year for decades. Although not every year will be a good one, trying to predict when the market will do well and when it will struggle can be next to impossible.

The safer and more dependable option is to invest for the long term and ride out the volatility. Investing in an exchange-traded fund (ETF) that tracks the S&P 500 can be an excellent way to benefit from the market's growth over the years.

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*Stock Advisor returns as of June 30, 2025

David Jagielski has no position in any of the stocks mentioned. The Motley Fool has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy.

Big-box retailer Target (NYSE: TGT) has been one of the S&P 500's worst-performing stocks this year. Poor growth numbers and concerns about the overall economy have been weighing on its valuation of late. The stock is trading at levels it hasn't been at in multiple years.

While Target's stock does look cheap, investors may be worried that it's not necessarily a bargain but instead a value trap and that the stock may be destined to fall even lower. Is that the case with Target, or could the market be overreacting to its recent struggles? Is it a stock worth adding to your portfolio today?

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Target has been struggling to grow

The big problem with Target is that its business has been sluggish, and that's been going on for a while. The company experienced a boom amid the pandemic, but it has been difficult for it to simply generate positive growth in recent quarters.

TGT Operating Revenue (Quarterly YoY Growth) data by YCharts

Target relies heavily on discretionary spending, which makes it vulnerable to slowing economic conditions. And what's most concerning is that the worst may still be to come -- a full-blown recession.

For now, the economy is still doing relatively well, but if there's more of a slowdown and consumers further tighten up spending, then Target's top line may go on a much deeper nosedive in future quarters. The company is looking at raising prices due to tariffs, which may only exacerbate its current situation.

Target is trading at a steep discount

This year, shares of Target have declined by around 30% (as of June 20). It's been a brutal start that has pulled the stock down to levels it hasn't been at since early 2020. And the decline is also evident through the stock's price-to-earnings (P/E) multiple, which is well below its five-year average.

TGT PE Ratio data by YCharts

This steep discount highlights just how worried investors appear to be about the business. If the P/E is very low, that signifies that investors aren't confident about its future growth and are likely pricing in more challenging times ahead.

On the flip side, however, such a low valuation gives investors a bit of a margin of safety and buffer. If the company doesn't perform well, by investing in it at a discount, you may not be all that vulnerable to a steep drop in price. In the best-case scenario, where the business performs better than expected, the stock could be in a prime position to take off.

Why I don't think Target is a value trap

Many retailers are struggling amid the current economic conditions and the threat that tariffs pose to their businesses, not only Target. The company isn't doing well right now, but I think it would be premature to say its business is broken and that the stock is a value trap. It wasn't all that long ago that it was growing at a fast pace and commanding a much higher valuation. Unfortunately, concerns about the economy are impacting the business, and that can't be ignored.

If the company were doing badly and the economy was in good shape, then I'd be inclined to say that is indeed a value trap. But Target isn't at that stage right now. It could still endure some tough quarters ahead, but if you're willing to hold onto the stock for multiple years and be patient with it, this is a stock that could prove to be a bargain buy in the long run.

Should you invest $1,000 in Target right now?

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Consider when Netflix made this list on December 17, 2004... if you invested $1,000 at the time of our recommendation, you’d have $676,023!* Or when Nvidia made this list on April 15, 2005... if you invested $1,000 at the time of our recommendation, you’d have $883,692!*

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*Stock Advisor returns as of June 23, 2025

David Jagielski has no position in any of the stocks mentioned. The Motley Fool has positions in and recommends Target. The Motley Fool has a disclosure policy.

Investing a regular amount of money into the stock market each month can be an excellent way to grow your savings and build up a portfolio that's eventually worth $1 million or more. But it can be challenging to do, especially since you have to ensure you can continue to afford making monthly investments, and then picking which investments to make with that money. Amid volatile economic conditions, that's no easy task.

You can, however, simplify the process by going with some solid exchange-traded funds (ETFs) that can diversify your portfolio and set you up for some great growth opportunities in the future. A couple of low-cost Vanguard ETFs to consider for this purpose include the Vanguard Growth Index Fund (NYSEMKT: VUG) and the Vanguard Information Technology Index Fund (NYSEMKT: VGT).

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Here's why investing $300 per month into either one of these ETFs could put you on track to generating a $1 million portfolio in the future.

Vanguard Growth Index Fund

The Vanguard Growth Index Fund is a great, growth-focused ETF you can add to your portfolio. It charges an expense ratio of only 0.04%, which means you don't have to worry about high fees chipping away at your gains.

What's attractive about this fund is that it focuses on large-cap growth stocks. These are the types of investments that can drive long-run returns for your portfolio and make the most of your money. Stocks such as Tesla, Amazon, and Nvidia are all among its top-10 holdings. These are leaders within their respective industries, and their businesses are synonymous with growth. With more than 160 stocks in total, this is a well-diversified ETF to simply buy and hold. It also yields around 0.5%.

Over the past decade, the ETF has achieved total returns (which include dividend payments) of approximately 327%. That averages out to a compound annual growth rate (CAGR) of 15.6%.

But for the sake of being conservative, let's assume that its returns will slow down given how hot the market has been in the past few years and how it's reaching record levels. If the ETF averages a return of about 10% for the very long haul (which is in line with the S&P 500's long-term average), then a $300 per-month investment could grow to more than $1 million after a period of 34 years.

This would require investing in the ETF every month during that time frame. But by doing so, you can put yourself on a path to producing some fantastic returns thanks to the effects of compounding.

VUG Total Return Level data by YCharts.

Vanguard Information Technology Index Fund

As terrific of a growth investment as the Vanguard Growth Index Fund has been in recent years, it still falls well short of the gains the Vanguard Information Technology Index Fund has produced during that stretch. At 543%, its 10-year total returns average out to an annual gain of 20.5%.

That's a mind-boggling return, and it highlights just how impressive the stocks within this ETF have been. There will be some overlap between this fund and the growth ETF, but the big difference is there is heavier exposure to big tech. Nvidia, Microsoft, and Apple account for a combined 45% of the Vanguard Information Technology ETF's total holdings, but they make up just around 32% of the growth ETF. That difference can be substantial over time, especially given how well a massive stock like Nvidia has performed. In 10 years, its returns have been truly exceptional, totaling 28,000%.

Given Nvidia's size today as one of the most valuable companies in the world, odds are its returns will be far more modest over the next decade. While they may still be great, it's probably a good idea to factor in a healthy dose of conservatism with this ETF as well given how much of a boost Nvidia has given it in the past. Even though the ETF is focused on tech and growth, averaging 20% annual returns likely isn't going to be sustainable over the very long haul. The expectation of a 10% return may also be prudent with this ETF to ensure your expectations aren't set too high for future gains.

As with the growth ETF, if you invest $300 per month into this fund, you can also be on the path to a $1 million portfolio. If this ETF continues to outperform the market, however, then it may take less than 34 years to get to $1 million. But by staying the course and investing regularly into this or the growth ETF, you can be in a good position for building up a solid portfolio over the long haul.

The Vanguard Information Technology ETF charges an expense ratio of 0.09%, and while that's a bit higher than the growth ETF's fees, they aren't going to drastically alter your prospects for generating potentially life-changing returns from regularly investing in this fund.

Should you invest $1,000 in Vanguard Index Funds - Vanguard Growth ETF right now?

Before you buy stock in Vanguard Index Funds - Vanguard Growth ETF, consider this:

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*Stock Advisor returns as of June 9, 2025

John Mackey, former CEO of Whole Foods Market, an Amazon subsidiary, is a member of The Motley Fool's board of directors. David Jagielski has no position in any of the stocks mentioned. The Motley Fool has positions in and recommends Amazon, Apple, Microsoft, Nvidia, Tesla, and Vanguard Index Funds-Vanguard Growth ETF. 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.

The IPO market is alive and well, and the best example of that is Circle Internet Group (NYSE: CRCL). It's one of the hottest new crypto stocks on the market. It began trading on the New York Stock Exchange earlier this month, and from an initial public offering price of $31, it soared to a value of $133.56 as of June 13.

It doesn't hold Bitcoins or other risky digital assets, and it instead gives you a supposedly more stable way to invest in the crypto world. Here's what you need to know about the latest new crypto stock, and whether it's worth adding it to your portfolio today.

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Circle Internet Group's business centers around its stablecoin

Unlike meme coins and risky, volatile assets, Circle Internet Group is an issuer of a stablecoin, USDC, which is pegged to the U.S. dollar. That means that by definition, it shouldn't experience a lot of volatility. Finding a stable investment while also investing in crypto is no easy task as often the big allure is to generate a huge profit from a fast-moving asset like Bitcoin. Circle Internet Group, however, could be a more enticing option for risk-averse investors.

The company recently launched the Circle Payments Network, which connects the USDC to eligible banks. By providing "near-instant settlement," it can help facilitate transactions all over the world. The company says that interest is growing. "We are seeing growth in start-up banks and neo-banks in many emerging markets focused on providing digital dollar payment and settlement services using USDC and the Circle stablecoin network," the company said in its IPO filing. By having more people use the network and its stablecoin, that can help Circle drive more growth for its business in the long run.

The company's financials look impressive

Circle generates revenue primarily from the interest it earns on cash it receives in exchange for USDC. Through the first three months of 2025, the company's revenue totaled $578.6 million, which was an increase of 58% from the same period last year. This was largely due to an increase in USDC in circulation, with daily averages rising by 93%.

What was most impressive was Circle's bottom line, however. It totaled $64.8 million and was up 33%. With a profit margin north of 11%, this is an investment that looks a lot safer than many other crypto stocks; Circle's financials didn't feature any wild swings in value due to gains or losses on digital assets.

Where Circle may struggle

The big risk with Circle is that inevitably, everything hinges on the success and popularity of its stablecoin, USDC. At its core, this can still be a volatile business. The most popular stablecoin right now is Tether, which has a market cap of $156 billion, versus $62 billion for USDC. If USDC's popularity suffers, that could pose a big risk to Circle's future growth and profitability.

Another risk is that its revenue is vulnerable to changing interest rates. If rates decline, that will negatively impact Circle's financials, as interest rates along with USDC adoption drive its top line.

While investors may like the idea of investing into a crypto stock with steady financials and sound operations, generating interest income on USDC funds doesn't exactly scream growth, and it may not be the type of investment that excites crypto investors in the long run. Circle's success depends on the overall popularity of USDC. Without significant and continued increases in adoption, this can quickly become a slow-growing business.

Should you buy Circle Internet Group stock?

Although it's been a hot buy since going public, Circle Internet Group stock may already be a bit of a pricey investment to be hanging on to today as its market cap is at around $37 billion, putting it at a price-to-revenue multiple of more than 19. It has a lot of potential growth ahead, especially as the crypto world grows in size, but there's a lot of competition in this space and although USDC is one of the top stablecoins today, that may not be the case in a few years. Paying such a high premium for the business may not make a lot of sense right now.

Circle Internet Group's fundamentals look good, but with many question marks around its long-term future, I wouldn't rush to buy it, especially given how fast it has already rallied. It may be better to take a wait-and-see approach with this investment.

Should you invest $1,000 in Circle Internet Group right now?

Before you buy stock in Circle Internet Group, consider this:

The Motley Fool Stock Advisor analyst team just identified what they believe are the 10 best stocks for investors to buy now… and Circle Internet Group wasn’t one of them. The 10 stocks that made the cut could produce monster returns in the coming years.

Consider when Netflix made this list on December 17, 2004... if you invested $1,000 at the time of our recommendation, you’d have $658,297!* Or when Nvidia made this list on April 15, 2005... if you invested $1,000 at the time of our recommendation, you’d have $883,386!*

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*Stock Advisor returns as of June 9, 2025

David Jagielski has no position in any of the stocks mentioned. The Motley Fool has positions in and recommends Bitcoin. The Motley Fool has a disclosure policy.

Apple (NASDAQ: AAPL) has disappointed investors this year. It has delayed some artificial intelligence (AI) features for its iPhones until next year, and that has resulted in a lot of bearishness around the business as there are rival phones with advanced AI capabilities already available.

Shares of Apple are down more than 21% thus far in 2025 (as of June 13), with its valuation dipping below the $3 trillion mark.

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AI is a hot topic these days, with consumers seeking the latest tech on their phones to help with many day-to-day tasks. However, Apple recently published a report about AI that could shed some light as to why it may not be leading the charge and investing as heavily in next-gen technologies as other tech companies.

Apple may not be convinced of AI's potential

Researchers at Apple have been testing multiple AI reasoning models, and while they have seen that they can perform better than standard models, they fail as tasks become more complex.

As a result, the researchers believe that there are limits to the reasoning that AI can achieve, and they don't appear to be as convinced of its abilities as the general public. They found that the models couldn't follow steps in complex tasks and appeared to rely heavily on the familiarity of data, as opposed to applying advanced reasoning skills.

AI chatbots have become more sophisticated because they have been trained on existing data, but the ability for them to truly reason like humans is by no means a certainty. If Apple isn't convinced of the potential that AI possesses, that may be part of the reason it hasn't been investing as heavily in these types of technologies as its peers.

Even if Apple is right, investors have a right to be worried

Whether or not AI can reason like a human doesn't excuse the fact that Apple has fallen well behind other companies in terms of innovation. While Apple has made changes to the look and feel of its icons with its Liquid Glass design, the company's newest iPhones haven't given consumers a compelling reason to upgrade their devices. Apple's product sales over the six-month period ending March 29 have totaled $166.7 billion -- up just 2% from the same period last year. And iPhone revenue during that stretch was nearly unchanged.

Lack of growth and innovation is a big problem for Apple these days. Regardless of whether it's completely sold on AI or not, the company needs to be doing more in advancing its phones so they don't fall behind the competition. Things like cross-app awareness, extracting information from photos to fill in forms, and integrating with third-party apps are some of the AI features that could be coming to iPhones next year. But whether that will be sufficient to keep up with rivals is questionable.

While the company has built up a strong ecosystem of products and services, the danger is that customers may eventually see a reason to jump ship toward more innovative devices.

Is Apple stock a buy on weakness?

Apple's stock has struggled this year, but it's still not a terribly cheap buy, trading at 31 times its trailing earnings. At that kind of multiple, investors might expect to see much more growth from the business. I believe that a discount is warranted for Apple stock, given the company's lack of innovation and growth.

While the business is still robust and generating fantastic free cash flow and profits, its future growth is questionable, and that's a big reason investors are ditching Apple for other growth stocks instead. It can still make for a good long-term buy, but at an elevated valuation, I would look for other investments to buy.

Should you invest $1,000 in Apple right now?

Before you buy stock in Apple, consider this:

The Motley Fool Stock Advisor analyst team just identified what they believe are the 10 best stocks for investors to buy now… and Apple wasn’t one of them. The 10 stocks that made the cut could produce monster returns in the coming years.

Consider when Netflix made this list on December 17, 2004... if you invested $1,000 at the time of our recommendation, you’d have $658,297!* Or when Nvidia made this list on April 15, 2005... if you invested $1,000 at the time of our recommendation, you’d have $883,386!*

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*Stock Advisor returns as of June 9, 2025

David Jagielski has no position in any of the stocks mentioned. The Motley Fool has positions in and recommends Apple. The Motley Fool has a disclosure policy.

If you want to achieve significant gains in the stock market, you'll probably want to plan to hold on and remain invested for many years, or even decades. But in some cases, big payoffs can come much faster than that. The benefit of investing in growth stocks is that they have the potential to deliver some terrific returns.

For example, growth stocks Strategy (NASDAQ: MSTR), Mara Holdings (NASDAQ: MARA), and Verona Pharma (NASDAQ: VRNA) have yielded fantastic gains for investors over the past five years. If you had invested $15,000 into each one of these stocks just five years ago and held on, you would have a portfolio worth more than $1 million today. The question is, do they still have the potential for further significant gains for investors who buy them right now?

Where to invest $1,000 right now? Our analyst team just revealed what they believe are the 10 best stocks to buy right now. Continue »

Strategy

A $15,000 investment made five years ago into the company that at that time called itself MicroStrategy would now be worth around $458,000. That's a staggering return when you consider that its core technology business hasn't been taking off. The company, which earlier this year shortened its name to Strategy, has actually experienced a decline in revenue in recent years. While it's nominally involved in providing business intelligence solutions, the reason its stock skyrocketed was tied to its aggressive moves in the cryptocurrency space.

Strategy is the largest corporate holder of Bitcoin (CRYPTO: BTC), with a stash that now totals more than 500,000 coins. The company routinely updates investors on its position and Bitcoin holdings. Executive Chairman Michael Saylor is incredibly bullish on the popular digital currency's potential value, predicting that its token price will climb to well over $1 million in the future, and suggesting that it could potentially top $13 million by 2045.

Strategy stock could still rise higher if Bitcoin does well. But it's a highly speculative buy: Its valuation is not tied to its overall performance, but is instead contingent on how strong the crypto market is. If you're bullish about that, you may feel that the stock could be a good buy. But for the majority of investors, this investment is likely to be too risky and speculative to hold.

Mara Holdings

Bitcoin mining company Mara has also benefited from the cryptocurrency's rising value over the past five years. During that stretch, a $15,000 investment into the stock would have grown into a holding worth approximately $290,000. Remarkably, that result includes a steep drop that it hasn't fully recovered from yet: The crypto stock is down by more than 50% from where it began 2022.

In the past three years, the company's bottom line has fluctuated drastically, from a loss of more than $694 million in 2022 to a profit of $541 million in 2024, and the stock has been similarly volatile. Its performance inevitably hinges on the changes in the market value of the digital assets it mines and holds.

As with Strategy, this is a speculative buy, as Mara's valuation will ultimately depend on how well Bitcoin is doing. This isn't a stock I'd suggest owning unless you have an extremely high risk tolerance.

Verona Pharma

The only stock on this list that hasn't amassed its gains due to crypto is Verona Pharma. However, the biopharmaceutical company has still generated impressive returns for investors. A $15,000 investment in the business five years ago would now be worth $267,000. Add that to the gains from your hypothetical $15,000 investments in the other two companies mentioned, and you'd have around $1.02 million.

Shares of Verona started to take off in June 2024 after the company obtained Food and Drug Administration approval for Ohtuvayre as a maintenance treatment for chronic obstructive pulmonary disease. Analysts believe Ohtuvayre can become a blockbuster drug, generating more than $1 billion in annual revenue for Verona by 2029.

Verona incurred a loss of more than $173 million last year, but with Ohtuvayre already beginning to generate sales, the business is on a much more positive trajectory. The stock's valuation isn't cheap, as its market cap is hovering around $7 billion. But given its promising growth prospects and its possible path to profitability, it's the only stock on this list that I'd consider buying today.

Should you invest $1,000 in Strategy right now?

Before you buy stock in Strategy, consider this:

The Motley Fool Stock Advisor analyst team just identified what they believe are the 10 best stocks for investors to buy now… and Strategy wasn’t one of them. The 10 stocks that made the cut could produce monster returns in the coming years.

Consider when Netflix made this list on December 17, 2004... if you invested $1,000 at the time of our recommendation, you’d have $668,538!* Or when Nvidia made this list on April 15, 2005... if you invested $1,000 at the time of our recommendation, you’d have $869,841!*

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*Stock Advisor returns as of June 2, 2025

David Jagielski has no position in any of the stocks mentioned. The Motley Fool has positions in and recommends Bitcoin. The Motley Fool has a disclosure policy.

Investing in the stock market isn't all about trying to find the next big growth stock or swinging for the fences, hoping for a massive return. Many investors don't want to turn investing into a job that requires constantly monitoring stocks. They simply want investments that can generate recurring cash flow for years to come.

A good way to accomplish that is by investing in exchange-traded funds (ETFs) which can allow you to do that easily. Not only can you quickly diversify your portfolio through ETFs, but some of them also offer attractive yields.

Where to invest $1,000 right now? Our analyst team just revealed what they believe are the 10 best stocks to buy right now. Continue »

The ETFs listed below focus on blue chip dividend stocks and offer high yields. For long-term investors who don't want to worry about the market, these can be safe investments to buy and forget about.

Schwab U.S. Dividend Equity ETF

The Schwab U.S. Dividend Equity ETF (NYSEMKT: SCHD) pays a yield of 4%, which is fairly high for such a diversified investment. By comparison, the average yield on the S&P 500 is just 1.4%.

Another great feature of this fund is that its expense ratio is fairly low at just 0.06%, which ensures that fees don't chip away at your overall returns.

The stocks selected for the fund pay dividends and have strong financials. Some of the fund's top holdings include Coca-Cola, Verizon Communications, and Home Depot. These are the types of big-name stocks that you can feel comfortable hanging on to for the long haul, and which can generate recurring dividend income for your portfolio along the way.

The majority of the stocks are in energy, consumer staples, and healthcare, with those three sectors accounting for about 56% of the entire portfolio. In total, there are currently 103 holdings in the ETF.

If you just want a good buy-and-forget investment that provides you with plenty of dividend income, the Schwab fund can be an excellent option. Over the past year, its total returns (which include dividends) are modest but stable at around 4%. While that trails the S&P 500 and its 13% performance over the same time frame, in return, you get a fairly diversified investment that doesn't contain as much risk as the overall market.

Vanguard High Dividend Yield Index Fund ETF

A more diversified ETF to consider is the Vanguard High Dividend Yield Index Fund ETF (NYSEMKT: VYM), which has nearly 600 stocks in its portfolio. This is also a low-cost fund whose expense ratio is 0.06%. Its yield is, however, slightly lower at right around 3%, but that is still above average.

There can be a bit less risk and volatility with this ETF simply because there are more holdings, which means that there's less vulnerability to how a single stock performs in the fund. The largest holding in the ETF is Broadcom, which accounts for 4% of the fund's total weight. Other recognizable names include JPMorgan and ExxonMobil.

The Vanguard fund's main three sectors are financials (20%), healthcare (14%), and industrials (13%). In the past 12 months, this ETF's total returns are just under 11%, making it the best-performing fund on this list.

iShares Core High Dividend ETF

Rounding out this list is the iShares Core High Dividend ETF (NYSEMKT: HDV). At just over 8%, its total returns over the past year put it in the middle of the pack. But overall, it's the same story: Investors are sacrificing some returns with these ETFs in exchange for safety. They can help protect you and make your portfolio less susceptible to large declines, but they usually underperform the market when it is doing well.

^SPX data by YCharts.

With the iShares ETF, you'll be collecting a yield of 3.5%. It has a slightly higher expense ratio than the other two ETFs listed here at 0.08%, but the difference is minor and won't have a drastic effect on your overall returns.

The fund is a bit more concentrated with 75 holdings in its portfolio. The focus is on high-quality dividend stocks, with a bit less diversification. ExxonMobil, Johnson & Johnson, and Progressive, which are its three top holdings, make up more than 18% of the ETF's overall weight. Consumer staples, energy, and healthcare are the three largest sectors here, representing close to 60% of the ETF's overall portfolio.

All three of the ETFs listed here can be great options for income investors for the long haul. You get some excellent diversification, incur low fees, and collect fairly high yields.

Should you invest $1,000 in Schwab U.S. Dividend Equity ETF right now?

Before you buy stock in Schwab U.S. Dividend Equity ETF, consider this:

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Consider when Netflix made this list on December 17, 2004... if you invested $1,000 at the time of our recommendation, you’d have $635,275!* Or when Nvidia made this list on April 15, 2005... if you invested $1,000 at the time of our recommendation, you’d have $826,385!*

Now, it’s worth noting Stock Advisor’s total average return is 967% — a market-crushing outperformance compared to 171% for the S&P 500. Don’t miss out on the latest top 10 list, available when you join Stock Advisor.

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*Stock Advisor returns as of May 12, 2025

JPMorgan Chase is an advertising partner of Motley Fool Money. David Jagielski has no position in any of the stocks mentioned. The Motley Fool has positions in and recommends Home Depot, JPMorgan Chase, Progressive, and Vanguard Whitehall Funds-Vanguard High Dividend Yield ETF. The Motley Fool recommends Broadcom, Johnson & Johnson, and Verizon Communications. The Motley Fool has a disclosure policy.

If you want to retire a millionaire, there are many ways to do so, without having to take on significant risk. Even if you don't have a boatload of money to invest in the stock market today, simply adding to your position over time with regular monthly investments can lead to significant returns in the long run.

Investing in top exchange-traded fund (ETF) can be a low-risk strategy to deploy that can put you on a path to growing your portfolio to $1 million -- and potentially higher -- by the time you retire. Here's how investing $250 a month can set you up for a much more enjoyable retirement.

Where to invest $1,000 right now? Our analyst team just revealed what they believe are the 10 best stocks to buy right now. Continue »

Invest in a top Vanguard fund that's focused on growth

Vanguard ETFs typically come with low fees, have excellent diversification, and can make for solid long-term investments. The Vanguard Russell 1000 Growth Index Fund ETF (NASDAQ: VONG) is an excellent example of an ETF that you can safely put money into on a regular basis.

It has a modest expense ratio of just 0.07% and holds nearly 400 stocks. It focuses on growth and tracks the Russell 1000 Growth Index.

Tech is a major part of this ETF, accounting for over 56% of its total holdings. The next-largest sector, consumer discretionary, makes up just 19%.

As a result, there will be some volatility from one year to the next, but overall, the long-term trajectory should be a strong one. Over the past decade, the fund has outperformed the S&P 500 by a wide margin.

^SPX data by YCharts.

Past results don't predict the future, but the ETF's focus on growth stocks should make it an ideal fund to invest in over the long term, since it may be in a good position to outperform the broader markets.

How a monthly $250 investment could grow to over $1 million

If you're patient and continually invest $250 per month into the ETF, you could end up with a portfolio worth over $1 million. There are no secrets involved, it's just a matter of simply compounding your gains over the long haul.

Here's how your portfolio's value could grow, assuming you average an annual return of 10%, which is in line with the S&P 500's long-run average.

Portfolio Balance Assuming a $250 Monthly Investment
Year	10% Annual Growth
30	$569,831
31	$632,668
32	$702,084
33	$778,769
34	$863,484
35	$957,069
36	$1,060,454
37	$1,174,665
38	$1,300,836
39	$1,440,218
40	$1,594,195

Calculations and table by author.

Under these assumptions, it would take approximately 36 years for this investment strategy to result in your portfolio's balance rising to more than $1 million. This means continually investment every month for 36 years. But there are a couple things to consider with this.

The first is that your average annual return plays a big role in determining these values. If the ETF performs better than 10%, then you can reach the $1 million mark sooner. On the flip side, however, slow market conditions could mean it takes more than 36 years.

Second, you can accelerate these gains by investing more money over this timeframe. Whether it's an inheritance, money from tax returns, or a profit from the sale of a house or investment, any extra money you can afford to invest in the fund will result in more compounding over the years, which will strengthen your portfolio's overall returns.

It may not be exciting, but this is a safe way to invest for the long haul

You might be tempted to pursue more-aggressive growth investments that promise quicker and higher returns, but those will come with much more risk. By going with this route, you can ensure your money is safe and your returns don't hinge on a few risky investments. While you may see your portfolio's balance fall in a year if the overall market performs poorly, over the long term, you can expect to see it rise significantly.

Staying invested and adding to your position in a top fund like the Vanguard Russell 1000 Growth Index Fund ETF can give you the best of both worlds -- long-term safety and great returns.

Should you invest $1,000 in Vanguard Scottsdale Funds - Vanguard Russell 1000 Growth ETF right now?

Before you buy stock in Vanguard Scottsdale Funds - Vanguard Russell 1000 Growth ETF, consider this:

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Consider when Netflix made this list on December 17, 2004... if you invested $1,000 at the time of our recommendation, you’d have $617,181!* Or when Nvidia made this list on April 15, 2005... if you invested $1,000 at the time of our recommendation, you’d have $719,371!*

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*Stock Advisor returns as of May 5, 2025

David Jagielski has no position in any of the stocks mentioned. The Motley Fool has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy.

Has the excitement surrounding artificial intelligence (AI) stocks cooled off? Many top AI stocks are down this year, including Advanced Micro Devices (NASDAQ: AMD), better known as just AMD, and Nvidia (NASDAQ: NVDA). They have both declined around 15% thus far in 2025, which is worse than S&P 500's more modest drop of 4%.

There's still massive potential for AI to revolutionize businesses and entire industries, but investors have been starting to scale back their positions in AI. If, however, you're looking at the long haul, then now can be a great time to add a top AI stock to your portfolio. Which of these two chip stocks is the better option right now: AMD or Nvidia?

Where to invest $1,000 right now? Our analyst team just revealed what they believe are the 10 best stocks to buy right now. Continue »

Comparing their valuations

Nvidia is one of the most valuable companies in the world, with a market cap of $2.8 trillion. That has come down a bit amid its recent decline (last year it was well above $3 trillion), but it's still close to 17 times the value of AMD, which has a market cap of around $165 billion. While AMD isn't a small company by any means, when compared to Nvidia, it looks tiny.

While you might think that Nvidia is the pricier of the two stocks given its massive valuation, based on earnings, it's actually the cheaper stock.

NVDA PE Ratio data by YCharts

Last year, AMD reported $1.6 billion in profit, while Nvidia, which has a fiscal year that ends in January, has generated an incredible $72.9 billion in earnings over its last four quarters. Not only has its business been experiencing explosive growth, but Nvidia's bottom line has been growing quickly as its profit margin has averaged 56%. That has enabled its price-to-earnings (P/E) multiple to remain relatively low.

By comparison, AMD's profit margin is just 6%. And with a more modest bottom line, it's the more expensive stock of the two when taking into account its earnings per share.

Which AI stock may have the most upside?

Both stocks have been struggling this year but when looking at the past 12 months, Nvidia is still up around 29% while AMD has fallen by 33%. A case could be made that AMD may be due for a rally, especially if its AI chips prove to offer formidable competition to Nvidia's high-priced options. AMD CEO Lisa Su previously forecast that the company could generate "tens of billions of dollars in annual revenue" in the near future due to its AI chips.

If AMD can generate that much growth, it can certainly help attract more investors and propel the stock to a much higher valuation. Thus far, it's lagged behind Nvidia in a big way. Last year, AMD's sales rose by 14%, while Nvidia more than doubled its revenue during its most recent fiscal year. But what also matters are AMD's margins, which need improvement. Otherwise, its P/E multiple may not come down significantly even if its growth rate accelerates. And a high premium could deter investors.

Nvidia is in pole position today, dominating the market and still innovating and coming up with new AI chips. AMD has to prove that it can put up some formidable competition. And until it does, that could limit its upside both in the near term and the long term.

Nvidia is the stock I'd go with today

AMD can potentially be a great long-term investment but it has a lot of question marks around its operations; it's far from a slam-dunk buy at this stage and it comes with some risk. Not only does it need to show that its chips can provide real competition to Nvidia, but the company also has to improve upon its single-digit profit margin.

With much stronger financials, a more attractive valuation, and a more dominant position in the market, Nvidia is the better AI stock to buy today.

Don’t miss this second chance at a potentially lucrative opportunity

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 $303,566!*
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• Netflix: if you invested $1,000 when we doubled down in 2004, you’d have $623,103!*

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David Jagielski has no position in any of the stocks mentioned. The Motley Fool has positions in and recommends Advanced Micro Devices and Nvidia. The Motley Fool has a disclosure policy.

Starbucks (NASDAQ: SBUX) has been undergoing changes over the past several months in an effort to turn around its business and get back to growth. CEO Brian Niccol took over back in September and has been working on improving the in-store experience for customers. The company is still in the early stages of that turnaround, but Niccol is seeing progress.

Recently, Starbucks released its latest quarterly numbers, which showed positive growth. And Niccol is optimistic that better results are ahead for the business. With the coffee stock down around 30% from its 52-week high at the time of this writing, has it become a no-brainer buy?

Where to invest $1,000 right now? Our analyst team just revealed what they believe are the 10 best stocks to buy right now. Continue »

Starbucks shows some progress with Q2 results

On April 29, coffee giant Starbucks reported its second-quarter earnings numbers. For the period ending March 30, consolidated net revenue rose by 2% to $8.8 billion. And the company's global comparable-store sales were down by just 1% -- in the previous quarter, the decline was as much as 4%. While those aren't blowout numbers, they do show that, at least for now, things may be stabilizing.

Niccol was encouraged with the results and the company's turnaround thus far, stating, "We are on track and if anything, I see more opportunity than I imagined." The new CEO has been working on making the Starbucks experience better for customers, which has included simplifying the menu and working on improving wait times at stores.

Why the results may not look all that impressive

At first glance, it may appear as though Starbucks is generating good, modest growth, and could be making a solid turnaround. But don't forget that the company is coming off some poor quarters and lapping some underwhelming comparable numbers. Consider that the company's revenue two years ago, in the same quarter, totaled $8.7 billion -- nearly as much as it generated this past quarter.

The top line is effectively flat over a two-year window and puts into context the challenges that Starbucks has been enduring during that time frame. Meanwhile, the $384 million in profit it posted last quarter was just a fraction of the $908 million in earnings it reported two years ago.

And so while the lack of change in the top line may be underwhelming, what's even more concerning is the significant drop on the bottom line. When looking at the bigger picture, the results don't nearly look as impressive anymore.

Investors also shouldn't forget that given the macroeconomic uncertainty in the markets today, Starbucks' results may look even less impressive in the future. While the CEO is optimistic, investors often need to take such excitement from management with a grain of salt.

Is Starbucks stock a good buy?

As of Monday's close, shares of Starbucks have fallen by around 11% since the start of the year. And the stock trades at roughly 30 times its trailing earnings, which is high compared to the S&P 500 average of 23.

Given the risk and uncertainty facing Starbucks, it should arguably be trading for more of a discount. I wouldn't rush out to buy the stock, as its results weren't all that impressive when you compare to where it was just two years ago. And although Niccol is optimistic about the future, investors should brace for more challenges ahead, as Starbucks still has a long way to go in proving that it can turn things around, grow its business at a high rate, and improve upon its bottom line.

For now, this is a stock I'd put on a watch list and take a wait-and-see approach.

Should you invest $1,000 in Starbucks right now?

Before you buy stock in Starbucks, consider this:

The Motley Fool Stock Advisor analyst team just identified what they believe are the 10 best stocks for investors to buy now… and Starbucks wasn’t one of them. The 10 stocks that made the cut could produce monster returns in the coming years.

Consider when Netflix made this list on December 17, 2004... if you invested $1,000 at the time of our recommendation, you’d have $623,103!* Or when Nvidia made this list on April 15, 2005... if you invested $1,000 at the time of our recommendation, you’d have $717,471!*

Now, it’s worth noting Stock Advisor’s total average return is 909% — a market-crushing outperformance compared to 162% for the S&P 500. Don’t miss out on the latest top 10 list, available when you join Stock Advisor.

See the 10 stocks »

*Stock Advisor returns as of May 5, 2025

David Jagielski has no position in any of the stocks mentioned. The Motley Fool has positions in and recommends Starbucks. The Motley Fool has a disclosure policy.

As of Monday's close, the S&P 500 was down by about 4% from where it started the year -- and that's after the markets bounced back considerably from their 2025 lows in recent weeks.

One stock, however, that has soundly outperformed the broad index this year is Dollar General (NYSE: DG). It's up more than 21%. The discount retailer has been a growth machine over the years, and opened its 20,000th location in 2024. Its significant presence across the country and its focus on low-cost goods have led many investors to see it as a promising opportunity of late.

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But what's been driving the share price rally? Is now really a good time to invest in Dollar General?

Why is Dollar General stock doing so well in 2025?

One big reason for Dollar General's impressive gains in the early part of 2025 is that investors see it as a fairly safe stock to hold amid the growing risks related to tariffs. According to analysts' estimates, just 4% of Dollar General's purchases are imported goods. Rival Dollar Tree has much more exposure to tariffs, and its stock has experienced a more modest increase of 12% this year.

Another condition supporting Dollar General's rise, however, could simply be that the stock was beaten down previously. Last year, Dollar General's stock lost 44% of its value, and the year before that, it fell by 45%. After such a sharp sell-off over two consecutive years, some bargain hunters may have been loading up on the stock as it was trading in the neighborhood of its seven-year low.

Even after its gains this year, it's still below $100 -- nowhere near the high of over $260 that it hit in 2022.

The company may not be out of the woods just yet

Before you decide to pile your own money into Dollar General's rally, consider that while its direct exposure to tariff risks may not be high, there are still other problems to worry about, too. First and foremost, its core customer base is struggling, and Dollar General management has mentioned this on multiple occasions. Most recently, in March, CEO Todd Vasos said that many of the chain's customers "only have enough money for basic essentials."

Now, consider that Dollar General's core customer is already feeling the pinch, and the U.S. economy has yet to come close to feeling the full effects of tariffs, which could include layoffs, rising unemployment, and a wide-scale reduction of spending across the board as consumers tighten their belts.

For its current fiscal year, which ends in January 2026, Dollar General has guided for same-store sales growth of between 1.2% and 2.2%. But I wouldn't be surprised by a downward adjustment to that if economic conditions worsen as the year progresses.

Investors should tread carefully

Despite Dollar General stock's encouraging start to 2025, I wouldn't hop on the bandwagon just yet. The business may struggle less than some of its peers, but it may still not perform all that well. If its core customer is already only buying essentials, and tougher times appear to be ahead, it's not hard to imagine a scenario in which Dollar General performs worse than expected and the stock gives back some of its early gains.

The stock trades at 18 times its trailing earnings, which is light in comparison to the S&P 500 average of 23, but there's good reason for that -- Dollar General's business has been sluggish in recent years and there hasn't been much of a reason to be optimistic. It should be trading at a discount.

While Dollar General may not be as vulnerable to tariffs as other companies, I don't see that as a good enough reason to buy shares. There are far better growth stocks out there to add to your portfolio.

Should you invest $1,000 in Dollar General right now?

Before you buy stock in Dollar General, consider this:

The Motley Fool Stock Advisor analyst team just identified what they believe are the 10 best stocks for investors to buy now… and Dollar General wasn’t one of them. The 10 stocks that made the cut could produce monster returns in the coming years.

Consider when Netflix made this list on December 17, 2004... if you invested $1,000 at the time of our recommendation, you’d have $623,103!* Or when Nvidia made this list on April 15, 2005... if you invested $1,000 at the time of our recommendation, you’d have $717,471!*

Now, it’s worth noting Stock Advisor’s total average return is 909% — a market-crushing outperformance compared to 162% for the S&P 500. Don’t miss out on the latest top 10 list, available when you join Stock Advisor.

See the 10 stocks »

*Stock Advisor returns as of May 5, 2025

David Jagielski has no position in any of the stocks mentioned. The Motley Fool has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy.