3 US stocks to buy for 2022

These could be some of the best US stocks to buy for 2022 and beyond, says Rupert Hargreaves, who would buy all three for his portfolio.

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As well as hunting for UK equities to buy for my portfolio in 2022, I have also been searching out US stocks to buy. I think it is vital to look overseas when searching for top investments as it opens up a vast universe of businesses. Some of these firms have no comparable peers in the UK. 

As such, here are three US stocks I would buy for my portfolio in 2022. 

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US stocks to buy for growth 

Google’s parent company, Alphabet (NASDAQ: GOOG), is one of the world’s largest technology corporations. It has built its brand over the past two decades through the Google search engine, but today, the establishment is far more than a web portal. 

Alphabet owns cloud computing assets, a hardware and software business, and has a portfolio of startup bets. Together, these assets suggest that the business is built for whatever the world throws at it.

They also indicate to me that this company is one of the best ways to invest in the growth of the global internet infrastructure. As the technology sector continues to boom, the business should reap the benefits. 

These are the main reasons I would buy the shares for my portfolio for 2022 and beyond.

Some challenges it could face include regulatory headwinds, which could force the breakup of the business. This is the worst-case scenario. 

DIY giant

Home Depot (NYSE: HD) has been one of the big winners of the pandemic. Stuck-at-home consumers have flocked to the firm’s stores to purchase tools and equipment for DIY projects. And even though the world has opened up over the past few months, the US retailer’s sales have continued to grow. 

The retailer reported $36.8bn in sales during the fiscal quarter to the end of October, representing a 9.8% increase compared to the year-ago period. Moreover, big-ticket transactions of more than $1,000 were up 18% year-on-year, giving the company’s net profit margin a big leg up to 11.2%, from 10.2%. 

Considering these figures, I think the company is one of the best US stocks to buy in 2022 as it builds on the growth of the past few years. As we advance, challenges it could face include higher wage costs and other inflationary pressures, which could hurt revenue growth and increase costs. 

Global pharma champion 

Pfizer (NYSE: PFE) is one of the largest pharmaceutical companies in the world. Today, it is best known for its Covid-19 vaccine, which is generating billions in sales for the group. 

But there is far more to this business than its vaccine division. It has a vast portfolio of treatments both on sale and under development, which will add support to the company’s growth in the future.

What’s more, the company should be able to use the profits from its Covid vaccine sales to invest in additional research and development projects. 

Pfizer has plenty of other attractive qualities as well. The group has a robust balance sheet and a dividend yield of 2.6%, at the time of writing. Management has also distributed large amounts of capital to investors in the past with share repurchase. 

Unfortunately, despite these qualities, the company’s success is not guaranteed. It will face challenges, including regulatory headwinds and competition in its drug markets. These could increase costs for the group, reducing profit margins. 

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Suzanne Frey, an executive at Alphabet, is a member of The Motley Fool’s board of directors. Rupert Hargreaves has no position in any of the shares mentioned. The Motley Fool UK has recommended Alphabet (A shares). Views expressed on the companies mentioned in this article are those of the writer and therefore may differ from the official recommendations we make in our subscription services such as Share Advisor, Hidden Winners and Pro. Here at The Motley Fool we believe that considering a diverse range of insights makes us better investors.

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