Have $500? 3 Absurdly Cheap Stocks Long-Term Investors Should Buy Right Now

The article identifies Amazon, Dutch Bros, and Realty Income as attractive investment opportunities, even for small-budget investors, based on their recent financial performance and growth prospects. Amazon, despite its scale, reported a 141% increase in H1 net income driven by AWS and double-digit growth in other segments. Dutch Bros is rapidly expanding its drive-thru coffee concept, achieving 34% H1 revenue growth and trading at a lower price-to-sales multiple than Starbucks. Realty Income, a REIT, offers a stable, growing monthly dividend with a 5% yield, nearly 99% occupancy, and a 25% increase in Funds From Operations (FFO), valued at a reasonable 15 times FFO.

Analysis

The article identifies Amazon (AMZN), Dutch Bros (BROS), and Realty Income (O) as compelling investment opportunities, even for smaller capital allocations. Amazon, despite its $1.75 trillion market capitalization and a 40x P/E ratio, demonstrated significant growth, with H1 revenue rising 11% to $291 billion. Its net income surged 141% to $24 billion in the first half, primarily driven by effective expense management and the high profitability of its AWS segment, with other segments showing double-digit revenue growth.

Dutch Bros (BROS) is rapidly expanding its drive-thru coffee concept, reporting a 34% year-over-year revenue increase to $600 million in H1 2024. The company added 158 shops in 12 months, reaching 912 locations, and benefits from lower overhead compared to competitors like Starbucks due to its drive-thru model. Its current valuation at 2.1 times sales is notably lower than Starbucks' 2.3 times sales, suggesting a more attractive entry point for a company with significant growth runway.

Realty Income (O), a prominent REIT, offers a stable income stream with a monthly dividend yielding over 5%, supported by 30 years of consistent increases. The company maintains a nearly 99% occupancy rate across its 15,500 properties, leased to high-quality, consumer-oriented tenants. H1 revenue grew 32% to $2.6 billion, with Funds From Operations (FFO) income increasing 25% to $1.7 billion, largely due to the Spirit Realty acquisition, and trades at approximately 15 times its FFO income.

Key Decisions for Investors

• Investors seeking growth exposure should consider Amazon (AMZN) for its robust H1 net income growth and the continued strength of its high-margin AWS and other double-digit growth segments.
• For rapid expansion in the consumer discretionary sector, Dutch Bros (BROS) presents an attractive opportunity given its significant revenue growth, expanding footprint, and favorable price-to-sales valuation relative to Starbucks.
• Income-focused investors may find Realty Income (O) compelling due to its consistent monthly dividend, high occupancy rates, and stable FFO growth, offering a reliable income stream at a reasonable FFO multiple.