As the market hits new all-time highs, many investors might be reluctant to buy more stocks. Warren Buffett warned investors to be fearful when others are greedy, and there's definitely a lot of greed priced into the major indexes right now.
However, plenty of blue chip stalwarts are still trading at reasonable valuations with lots of catalysts on the horizon. Let's check out three of these stocks -- Amazon (NASDAQ: AMZN), Coca-Cola (NYSE: KO), and Uber Technologies (NYSE: UBER) -- and see why they're still great buys.
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Amazon, the world's top e-commerce and cloud infrastructure provider, is still a well-balanced growth stock. It operates online marketplaces in more than 20 countries, provides international shipping to more than 100 countries, and has locked in more than 220 million Prime subscribers. Its Whole Foods Markets and Amazon Go stores also give it a brick-and-mortar presence.
Its cloud platform, Amazon Web Services (AWS), controlled 33% of the global cloud infrastructure market at the end of 2024, according to Canalys. AWS generates higher-margin revenue than Amazon's retail business, and that support enables the parent company to expand its e-commerce business with more discounts, promotions, and digital perks.
Amazon's advertising business, which handles its integrated ads and promoted listings, also operates at higher margins than its retail business. That segment isn't as big as AWS yet, but it could expand and evolve into a secondary profit engine.
From 2024 to 2027, analysts expect Amazon's revenue and EPS to have compound annual growth rates (CAGRs) of 10% and 17%, respectively. Its e-commerce business should stabilize as consumer spending warms up, and its ongoing automation efforts should reduce those costs.
The rapid growth of the AI market should also generate strong tailwinds for its cloud business. Amazon's stock might not seem like a bargain at 31 times next year's earnings, but all those tailwinds should support its higher valuation and drive up its stock even more.
If you expect interest rates to decline and reduce the appeal of Treasury bills and CDs over the next few years, it would be smart to buy some of the market's most reliable dividend stocks. One that checks all the right boxes is Coca-Cola, the world's largest beverage company.
The company is a Dividend King, having raised its payout annually for 63 consecutive years. It currently pays a forward yield of 2.9%, which is supported by a stable payout ratio of 79%.
Coca-Cola might seem a risky long-term investment as soda consumption wanes, but the company has launched and acquired more brands of bottled water, tea, fruit juice, sports drinks, energy drinks, coffee, and even alcoholic beverages to curb its dependence on sugary sodas. It also updated its sodas with new flavors, smaller serving sizes, and healthier versions to attract younger consumers.
Management only sells the concentrates and syrups for its drinks, while its bottling partners produce and sell the beverages. That asset-light approach lets the company generate plenty of cash and insulates it from regional macroeconomic headwinds.
For 2025, Coca-Cola expects its organic sales to rise 5% to 6% as its comparable EPS grows 2% to 3%. From 2024 to 2027, analysts expect its revenue and EPS to have CAGRs of 5% and 11%, respectively. It still looks reasonably valued at 23 times next year's earnings, and it could be a great evergreen play in a bull or bear market.
Uber, which provides ride-hailing and food delivery services in about 15,000 cities across 70 countries, is still growing rapidly. From 2020 to 2024, its number of year-end monthly active platform consumers (MAPCs) rose from 93 million to a record high of 171 million. Its total revenue had a CAGR of 41% during those four years.
As Uber grew, it streamlined itself by divesting its weaker businesses. As a result, its adjusted earnings before interest, taxes, depreciation, and amortization (EBITDA) turned positive in 2022 and had a CAGR of 95% through 2024. The company also turned profitable over the past two years as it reined in its stock-based compensation.
A lot of Uber's recent growth was driven by its Uber One subscription service, which exceeded 30 million subscribers at the end of 2024; the expansion of its ecosystem with new enterprise, healthcare, and teen-focused services; and its strong pricing power. From 2024 to 2027, analysts expect its revenue and adjusted EBITDA to show CAGRs of 14% and 26%, respectively.
Uber's business is maturing, but it still has plenty of irons in the fire and looks like a bargain at 17 times next year's adjusted EBITDA. So if you expect Uber to continue dominating the ride-sharing and food delivery markets, it could be a great time to buy some shares -- even if the broader market looks a little frothy.
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John Mackey, former CEO of Whole Foods Market, an Amazon subsidiary, is a member of The Motley Fool's board of directors. Leo Sun has positions in Amazon. The Motley Fool has positions in and recommends Amazon and Uber Technologies. The Motley Fool has a disclosure policy.