Have $1,000? These 2 Stocks Could Be Bargain Buys for 2025 and Beyond

In the ever-evolving landscape of the stock market, identifying bargain buys can be a game-changer for investors. With growth stocks having a stellar run in 2024, only to face a recent selloff, the market presents a unique opportunity for long-term investors. Two standout stocks, Rentokil Initial (RTO) and Taiwan Semiconductor Manufacturing (TSM), are currently trading at significant discounts to their fair value estimates, making them compelling choices for those with $1,000 to invest.



Rentokil Initial: A Pest Control Powerhouse

Rentokil Initial, a leader in pest control and hygiene services, has seen its stock price drop to a 47% discount from its fair value estimate of $40.30 per share. This discount presents a golden opportunity for investors looking to capitalize on a company with a strong economic moat and predictable cash flows. Rentokil's strategy of acquiring targets that build geographic density has resulted in a durable cost advantage, making it a formidable player in the pest control market. With over 200 acquisitions since 2015, including the transformative deal with Terminix Global Holdings, Rentokil is well-positioned to maintain its market leadership.

Taiwan Semiconductor Manufacturing: The Semiconductor Giant

Taiwan Semiconductor Manufacturing, the world's largest dedicated contract chip manufacturer, is another stock that has seen a significant selloff. Trading at a 37% discount to its fair value estimate of $273 per share, TSM offers investors a chance to buy into a company with a nearly 60% market share in the semiconductor industry. TSM's disciplined approach to capital spending and its leadership in cutting-edge research position it to benefit from long-term trends such as artificial intelligence, the Internet of Things, and high-performance computing applications. With a strong balance sheet and a proven track record of innovation, TSM is a solid choice for long-term investors.

Why These Stocks Are Bargain Buys

Both Rentokil Initial and Taiwan Semiconductor Manufacturing offer investors a unique opportunity to buy into high-quality companies at a discount. With growth stocks trading closer to fair value after recent selloffs, these two stocks stand out as bargain buys for 2025 and beyond. Investors should consider these stocks as part of a diversified portfolio, focusing on companies with strong fundamentals, predictable cash flows, and a proven track record of innovation.

Strategies for Mitigating Risks

While the current market conditions present an opportunity for long-term investors, it is essential to employ strategies to mitigate risks. Diversification, focusing on fundamentals, adopting a long-term perspective, and prioritizing resilience investing are key strategies that can help investors navigate the uncertainties of the market. By investing in companies with inherent resilience and a proven capability to manage economic fluctuations, investors can position themselves for long-term success.

In conclusion, with $1,000 to invest, Rentokil Initial and Taiwan Semiconductor Manufacturing offer compelling opportunities for long-term growth. By focusing on companies with strong fundamentals and a proven track record of innovation, investors can capitalize on the current market conditions and position themselves for success in 2025 and beyond.