My 3 Favorite Stocks to Buy Right Now

Has recent (and not-so-recent) volatility gotten your portfolio's allocation a little out of whack? Maybe it's time to reassess each of your existing holdings and replace the ones that no longer offer enough upside with more promising names.

My needs are not exactly the same as yours. However, there are some stocks that keep making their way back onto my radar and would likely be a good fit for most people's investment portfolios. Let's look at three of them.

Image source: Getty Images.

1. PepsiCo

Between the two seemingly similar beverage giants, Coca-Cola has clearly been the one to own for a while now. Coke shares are up more than 30% from their mid-2023 low and are still marching into record-high territory, while PepsiCo (NASDAQ: PEP) stock is down more than 30% for the same time frame and is still making new multiyear lows.

PepsiCo, which also owns Frito-Lay snack chips and Quaker Oats, just seems to be struggling under the weight of lingering inflation. Credit that to the fact that PepsiCo owns most of its production facilities, whereas Coke largely uses third-party bottlers who've borne the brunt of rising input costs.

In both cases, though, the buyers and the sellers have arguably overshot their targets.

That's not to say PepsiCo doesn't still have some things to figure out. As an example, for the final quarter of last year, the company's top line came in slightly below expectations for a third quarter in a row.

Blame price increases, mostly. Although its first-quarter revenue of $17.92 finally topped analysts' consensus outlook of $17.77, that was a muted top-line estimate. Organic revenue only improved 1.2% year over year, while net revenue slipped 1.8%. Per-share earnings came up short of expectations as well, prompting the company to dial back its full-year profit guidance. New or recently raised tariffs and crimped consumer demand are both reasons per-share earnings are now apt to fall to the tune of 3% in 2025.

The thing is, all of this headwind -- and then some -- is already priced into this stock's price, while none of PepsiCo's turnaround and regrouping efforts are. For instance, the company is rethinking its supply chain and looking for alternative sourcing of key inputs, while at the same time seeking exemptions for certain tariffs. At least some of these efforts will work.

In the meantime, the stock's weakness has pumped up its forward-looking dividend yield to 4.3% versus Coke's 2.8%. PepsiCo's dependable dividend, by the way, has now been raised for 53 consecutive years, with no end to the streak in sight.

2. Apple

Speaking of underperforming stocks, have you taken a look at Apple (NASDAQ: AAPL) lately? What's usually one of the market's best performers is now down more than 20% from its late-2024 high and is still struggling despite the overall market's bounce from its early April low.

It's not too tough to figure out why. Not only have Apple's recent (and proverbially late to the party) artificial intelligence (AI) efforts not resonated with consumers nearly as much as hoped, but recently raised tariffs specifically aimed at imports from China threaten Apple's all-important iPhone business.

In April, Rosenblatt Securities reported tariffs still in place at the time would inflate iPhone prices to the tune of 40%, while an all-American-made iPhone could cost on the order of $3,500 apiece, according to number-crunching done by Wedbush Securities analyst Dan Ives.

It's a problem for the company simply because about half of Apple's revenue comes from sales of iPhones.

Just don't let the media or a manic crowd talk you out of keeping things in their proper perspective.

Yes, the early response to Apple's artificial intelligence offerings has been ho-hum. Give it time, though. The company has not yet released everything it intends to on the artificial intelligence front, and what it has released was admittedly not quite ready -- particularly its AI-powered version of Siri. Both will change for the better over time, but it's going to take more time than many have expected. Apple's true next-generation version of AI-powered Siri, for instance, may not be released until 2027.

That might not be a bad thing, however. Apple's onboard iPhone hardware will be even more capable of handling intensive generative AI duties by then. And that's still early enough to capitalize on the artificial intelligence-powered digital assistant market that Precedence Research believes is set to grow at an average annualized pace of 24% through 2034.

As for sky-high tariffs, the rhetoric is agonizing, to be sure. Just consider the source. It's unlikely that President Donald Trump is willing to completely torpedo the U.S. economy by cranking up the cost of imported goods. Newly raised tariffs are largely just part of a bigger negotiation tactic that will eventually end with far more palatable trade agreements.

You'll want to make a point of already being in a position in Apple before most other investors start to recognize both of these aforementioned realities.

3. Markel Group

Finally, I'm eyeing Markel Group (NYSE: MKL) as a potential pickup that could work for you as well.

Never heard of it? It would be surprising if you had. The relatively small company (with a market cap of only $25 billion) doesn't sell any consumer-facing products with the same brand name. Its specialty insurance business isn't exactly aimed at households looking to insure their home or automobile, either.

Nevertheless, this is a curious and increasingly compelling investment prospect not despite its unusual nature but because of it.

But what is it, exactly? As was noted, it's first and foremost an insurer. That categorization doesn't do the company justice, though. It's far more accurate to call Markel a conglomerate in the same vein as Berkshire Hathaway.

Not only does Markel own several privately held companies like Brahmin handbags, Lansing building products, chemical and gas company Weldship, and crane manufacturer Buckner, just to name a few, but it also holds stakes in publicly traded outfits like Alphabet, Visa, Deere, and Home Depot. The ultimate end goal is the same, too. That's amassing enough cash to not only cover potential claim payouts but to deploy if and when the right investment opportunity comes along in the future.

Markel is no Berkshire Hathaway, to be clear. Indeed, it's caught a bit of (somewhat deserved) criticism of late for subpar dealmaking and not using technology as proficiently as it could have.

The thing is, the company is addressing such shortcomings at a time when Berkshire's in-house stock-picking guru, Warren Buffett, has plans to step away from the business, which is early next year. Not that Markel will become an immediate top alternative to an investment in Berkshire Hathaway, but it's certainly a longer-term possibility.

You might just want to be a little bit patient with this particular pick if you're interested. Markel shares have performed exceedingly well for a while now, pushing its price beyond analysts' consensus price target of $1,941.50.

Just don't wait too long if you're going to dive in. Even with the persistent bullishness here, the stock is only trading at about 10 times last year's net income. There's a lot of measurable value packed in here, even at this recently frothy price.

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Suzanne Frey, an executive at Alphabet, is a member of The Motley Fool's board of directors. James Brumley has positions in Alphabet and Coca-Cola. The Motley Fool has positions in and recommends Alphabet, Apple, Berkshire Hathaway, Deere & Company , Home Depot, Markel Group, and Visa. The Motley Fool has a disclosure policy.