Amazon

I’ve owned Amazon (NASDAQ: AMZN) for a few years now. However, last month, I decided it was time to buy a few more shares.

Why did I invest more money in the company?

Well, one reason is that I’m excited by the tech giant’s artificial intelligence (AI) offerings. Recently, it launched a new service called ‘Bedrock’ that lets customers build their own generative AI tools (similar to ChatGPT). It believes this has the potential to improve “virtually every customer experience”.

Another reason is that after a huge pullback, Amazon shares are now trending up again. So, they have positive momentum.

It’s worth pointing out that this stock is expensive. Going forward, I expect it to be volatile. I think the investment here will pay off in the long term, however.

Edwards Lifesciences

Another stock I added to was Edwards Lifesciences (NYSE: EW). It’s an under-the-radar US-listed healthcare company that specialises in artificial heart valves and blood flow monitoring.

I see this one as a great play on the world’s ageing population. In older adults, heart disease is one of the most frequent medical conditions observed. So, I expect demand for Edwards’ heart valve products to be high in the years ahead.

This stock is also quite expensive. I’m comfortable with the valuation here, however, as this is a very profitable company with a great long-term track record.

It’s worth noting that Fundsmith took a small position in it late last year (most likely for the Smithson investment trust).

Estee Lauder

The new stock I bought was beauty giant Estee Lauder (NYSE: EL). I’ve wanted to own it for a long time. When it crashed in May on weak guidance, I took the opportunity to begin building a stake.

What I like about it is that it gives me exposure to a number of powerful themes including:

• Rising incomes in China and emerging markets
• The increasing focus on skincare
• Demand for make-up to look good on Zoom

Of course, this doesn’t mean my investment will pay off. The company is experiencing a few challenges right now due to China’s slow reopening.

But I expect it to recover, and see further success, in the years ahead.

Unilever

Finally, I took the opportunity to top up my holding in Unilever (LSE: ULVR). It owns Dove, Domestos, and a bunch of other household-name brands.

One reason I added here is that I wanted to boost my ‘defensive’ exposure. I have a lot of exposure to growth stocks at present. Unilever adds balance to my portfolio.

A second reason I added is that Unilever has raised its prices significantly recently (this hit me when shopping for Dove deodorant). I think that when inflation (in raw materials, packaging, transportation) starts to moderate, it could see a decent jump in earnings.

It’s worth noting that Unilever is about to get a new CEO and CFO. This adds some uncertainty in the near term.

I’m confident in the long-term story though.

The post 4 shares I’ve been buying for my ISA appeared first on The Motley Fool UK.

Here, I’m going to highlight three top stocks in Terry’s Smith Fundsmith Equity fund I’d buy today. All of these companies are leaders in their industries and appear to have considerable long-term growth potential.

Microsoft

Let’s start with Microsoft (NASDAQ: MSFT), which is one of Fundsmith’s biggest holdings. It’s one of the largest technology companies in the world.

To my mind, MSFT has all the right ingredients to be a ‘core’ long-term holding. For starters, it has attractive long-term growth prospects. In the years ahead, it should benefit from the growth of the number of industries, including the cloud computing, remote work, and gaming industries. 

Yet at the same time, it’s a relatively ‘defensive’ company. People aren’t going to suddenly stop using Microsoft products like Office and Azure if there’s an economic slowdown. Meanwhile, the group has a strong balance sheet and generates an enormous amount of cash. 

Of course, MSFT is not risk-free. If we see further weakness across the tech sector, MSFT could underperform. With the stock now trading at 28 times next year’s earnings however, I think it’s a good time to be buying for my portfolio.

Estée Lauder

Next up is Estée Lauder (NYSE: EL). It’s one of the world’s largest skincare and make-up companies.

One reason I like this Fundsmith stock is that its brands provide a strong competitive advantage. When it comes to beauty products, people tend to buy the same brands over and over again.

Another reason I see appeal here is that the company looks set for growth both in the short term and the long term. In the short term, it could benefit as the world continues to reopen and people socialise more. Meanwhile, in the long run, the company looks set to benefit from the ‘premiumisation’ trend – where consumers are happy to pay more for premium products.

It’s worth pointing out that EL does have a relatively high valuation (the forward-looking P/E ratio is about 34). If future growth is disappointing, the stock could fall.

However, it has recently had a near-20% pullback. So I think it’s a good time to start building a position.

Intuit

Finally, I also like the look of Intuit (NASDAQ: INTU) right now. It’s a leading provider of accounting solutions, and the owner of QuickBooks.

There’s a lot to like about Intuit from an investment point of view, to my mind. One key attribute here is that its products are ‘sticky’. Once businesses sign up for an accounting product, they’re unlikely to switch to a competitor, due to the time and costs involved in switching. This means revenues are quite predictable.

Secondly, the company has a strong growth track record, and is very profitable. Over the last three years, revenue has climbed 60% and return on capital employed (ROCE) has averaged more than 30%.

Like MSFT, Intuit could underperform if sentiment towards tech stocks continues to deteriorate. In the short term, this is definitely a risk.

All things considered however, I see a lot of appeal here. After a recent pullback, the stock now trades at 35 times next fiscal year’s forecast earnings, which I think is a very fair valuation.

The post 3 Fundsmith stocks I’d buy today appeared first on The Motley Fool UK.