My 2 Favorite Stocks to Buy Right Now

Key Points

• Garmin just raised its growth and earnings outlook.

• Microsoft is generating enough cash to fund its aggressive growth goals.

• 10 stocks we like better than Garmin ›

Stock market returns have been stellar lately, with the S&P 500 gaining 10% on the year through early September and currently trading near its all-time highs. However, there are no shortage of worries that could derail that rally, but patient investors know that having a long investing time frame is their best strategy to maximize their chances for market-beating returns.

With that approach idea in mind, I'll look at a few stocks that seem set to trounce the market over the next decade or more, rather than just the next few months.

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 »

Read on for some great reasons to like Garmin (NYSE: GRMN) and Microsoft (NASDAQ: MSFT) stocks right now.

Image source: Getty Images.

Garmin is plotting the right course

In late July, Garmin announced about the best quarter that shareholders could have hoped for. Investors loved the 20% sales boost powered by demand for its hit new launches in the smartwatch category.

Yet Garmin also posted double-digit growth in each of its other product categories, including the outdoor division that's home to its adventure watches and the aviation segment that serves aircraft owners. That wide range of success means this business is diversified, but it also points to Garmin's translatable strength in areas like research and development, marketing, and product design.

The company hasn't had to sacrifice profitability for that growth, either. Operating income over the first six months of 2025 jumped nearly 30% to $800 million, pushing profit margin up to 24% of sales from 22% in the prior year. Management raised its outlook for both earnings and revenue and now see sales crossing $7 billion in 2025 .

Garmin's valuation is attractive, too, even as its shares trade near all-time highs. You can buy the stock for 29 times earnings right now, down from 32 times earnings in January. Apple, which is only slightly more profitable, trades at a price-to-earnings ratio (P/E) of 36 times. If you're looking for a great growth stock, consider putting Garmin in your portfolio.

Microsoft means business

Don't let Microsoft's $3.7 trillion price tag keep you away from this stellar business. That massive size hasn't stopped market-beating growth in recent months. Revenue jumped 15% this past full year, and earnings per share improved 16% to $13.64.

Owning Microsoft means you're exposed to several multiyear tech trends, led by the shift toward cloud services and rising demand for artificial intelligence (AI) enterprise software. Its Azure segment alone is now a $75 billion annual business, with sales rising 34% in fiscal 2025.

Microsoft returned $42 billion to shareholders last year, even as it invested heavily in data centers and innovations across its enterprise platform. The company could spend on all of these priorities because it's gushing cash, having generated $136 billion in the past year, up from $118 billion in fiscal 2024. These wins imply there's lots of room for the dividend to rise over the next decade, too.

The biggest risk in buying such a high-performing business is paying too much. Microsoft shares aren't especially cheap, valued at close to 40 times earnings today. Its possible that premium has been overblown by all the enthusiasm on Wall Street about AI's long-term potential.

Yet with Microsoft, investors are already seeing concrete financial gains powered by enterprise demand for AI, and the company has several other growth levers it can pull if the reality doesn't live up to the hype. That's why this stock has a great shot at beating the market from here, even as it rewards patient investors with accelerating cash returns in the coming years.

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

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Demitri Kalogeropoulos has positions in Apple. The Motley Fool has positions in and recommends Apple, Garmin, and Microsoft. 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.