“If I could buy only one stock right now, it would be…”

Most of us have a basket of stocks we’d like to buy at any given point. But it’s much harder to narrow it down to just one…

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When faced with myriad shares on your watchlist, a useful thought exercise is to apply hypothetical restrictions in order to determine which stock you might lean towards buying first.

Here, we asked our Foolish freelancers for the most attractive investment opportunity for them right now!

Alphabet

What it does: Alphabet is a holding company that owns Google. This tech titan is the world’s fourth-largest business with a market cap of $1.59 trillion.

By Charlie Carman. If I could invest in just one stock today, it would be Alphabet (NASDAQ:GOOG) (NASDAQ:GOOGL).

Search engine digital advertising revenue is the lifeblood of the business. Although it faces cyclical market risks, Google dominates this space. Microsoft‘s Bing is still a very distant competitor.

A suite of new artificial intelligence products shows Alphabet is well-placed to benefit from technology’s next frontier.

An email writing tool for Gmail, cutting-edge technology for Google Translate, immersive views for Google Maps, and an AI-powered ‘Magic Editor’ for Google Photos all form integral parts of the company’s growing arsenal.

What’s more, new hardware devices including the Pixel Fold and more budget-friendly Pixel 7A, should help to diversify Alphabet’s revenue sources.

The stock isn’t cheap with a price-to-earnings ratio of 28, but it’s not much more expensive than the S&P 500, which trades at 22 times earnings. I believe a premium company deserves a premium valuation.

Charlie Carman has positions in Alphabet and Microsoft.

Anglo American

What it does: Anglo American is one of the UK’s largest listed mining companies. It operates across 56 sites in 15 regions and employs over 90,000 people.

By Cliff D’Arcy. Why am I keen to buy Anglo American (LSE:AAL) shares? First, I don’t own any, but we do have a family holding in rival Rio Tinto.

Second, Anglo’s share price has plunged since peaking a year ago. This stock hit a 52-week high of 4,036p on 7 June 2022. By 31 May 2023, it had crashed to just 2,223.5p.

Third, this group might be a ‘fallen angel’ — a sound company whose shares have fallen out of favour. Furthermore, this stock’s fundamentals support my hunch.

Fourth, the shares trade on a lowly price-to-earnings ratio of 8.2, for an earnings yield of 12.2%. That’s over 1.5 times the FTSE 100‘s yield.

Fifth, Anglo stock offers a bumper dividend yield of 6.8% a year — nearly twice the Footsie’s yearly cash yield of 3.7%. Also, this cash payout is covered 1.8 times by earnings, for some margin of safety.

However, mining earnings and dividends can be highly volatile. Indeed, Anglo cut its dividend in 2015, 2016, 2020 and 2022. Nevertheless, I’m still keen to buy!

Cliff D’Arcy has positions in Rio Tinto.

Arista Networks

What it does: Arista designs critical hardware for cloud server infrastructure used in data centres worldwide.

By Zaven Boyrazian. Arista Networks (NYSE:ANET) may not be a name commonly heard in everyday life. And yet, without its technology, the cloud upon which almost all smart devices are dependent would cease to function.

The company designs ethernet switches and routing devices that provide the critical bandwidth needed for the internet to function.

Powered by its open-ended EOS software, Arista has been steadily stealing market share from Cisco over the last decade and now controls almost 42% of the global market. And with management increasing its focus on hyperscalers like Microsoft Azure, Arista’s global expansion could just be getting started.

However, this strategy does have a glaring weak spot. There are very few hyperscalers on the planet. And consequently, 42% of the revenue stream now stems from just Microsoft and Meta Platforms. Should Arista’s technology start to fall behind, it could have dire consequences on the bottom line.

Nevertheless, the potential long-term reward and consistent track record of defying expectations make this a risk worth taking — at least for my portfolio.

Zaven Boyrazian owns shares in Arista Networks.

What it does: Legal & General is a UK-based financial and insurance firm offering services such as life insurance and investment management.  

By Charlie Keough. If I could buy only one stock right now, it would be Legal & General (LSE: LGEN). As I write, the firm’s share price has taken a near 6% hit in 2023. However, I think the stock offers great value.  

Firstly, it looks cheap, with a price-to-earnings ratio of just 6.3. 

Its lower share price also means the stock offers an incredibly attractive dividend yield of 8.4%. This sits comfortably above the FTSE 100 average. And with ongoing inflation concerns, the passive income generated from this investment seems like a smart play. 

The business also has plenty of cash to hand. Cash generation for 2022 sat at £1.9bn, a 14% jump from the year prior. And it’s putting this to good use with its ambitious dividend plan.  

The firm may see investors tighten their belts and shy away from making investments in the foreseeable future as inflation persists.  

However, as a long-term buy, I deem Legal & General a smart play.  

Charlie Keough owns shares in Legal & General.

Vesuvius

What it does: Vesuvius specialises in metal flow engineering and provides services and solutions for the steel and foundry industries.

By Kevin Godbold. Vesuvius (LSE: VSVS) has recovery and growth potential. But one of the negatives affecting the business is its sensitivity to economic weakness in its end markets.

However, if recovery is coming as the directors believe, that same sensitivity potentially becomes a strength.

Trading was weak in 2022 and earnings dropped. But in May the company reported “resilient” trading in the first four months of 2023.

Looking ahead, Chief executive Patrick Andre said despite short-term uncertainty, the directors are “highly confident” in the company’s growth potential. And with good reason: the firm is continuing its capital investments for growth and in research and development (R&D).

Nevertheless, the pace of recovery in the company’s end markets is “slow and uncertain”. However, the directors expect acceleration ahead.

Meanwhile, with the share price in the ballpark of 413p, the forward-looking dividend yield for 2024 is just under 6% suggesting a modest valuation that tempts me.

Kevin Godbold does not own shares in Vesuvius.

Should you invest, the value of your investment may rise or fall and your capital is at risk. Before investing, your individual circumstances should be assessed. Consider taking independent financial advice.

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. The Motley Fool UK has recommended Arista Networks, Meta Platforms, and Microsoft. 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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