I’d buy and hold Tesco shares for the next 10 years

first_img Image source: Getty Images Click here to claim your copy now — and we’ll tell you the name of this Top US Share… free of charge! Simply click below to discover how you can take advantage of this. “This Stock Could Be Like Buying Amazon in 1997” Rupert Hargreaves owns no share mentioned. The Motley Fool UK has recommended Tesco. 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. I’d buy and hold Tesco shares for the next 10 years See all posts by Rupert Hargreaves Rupert Hargreaves | Saturday, 20th March, 2021 | More on: TSCO center_img Our 6 ‘Best Buys Now’ Shares I’m sure you’ll agree that’s quite the statement from Motley Fool Co-Founder Tom Gardner.But since our US analyst team first recommended shares in this unique tech stock back in 2016, the value has soared.What’s more, we firmly believe there’s still plenty of upside in its future. In fact, even throughout the current coronavirus crisis, its performance has been beating Wall St expectations.And right now, we’re giving you a chance to discover exactly what has got our analysts all fired up about this niche industry phenomenon, in our FREE special report, A Top US Share From The Motley Fool. I think only a few companies are worth buying and holding for the next 10 years. However, I believe Tesco (LSE: TSCO) shares fall into this bracket. And today, I’m going to explain why I’d purchase the stock for my buy-and-hold portfolio.Slow and steadyThe problem with picking shares to own for the next 10 years is that it’s impossible to tell the future. We don’t know what the world will look like a decade from now and which companies or technologies will exist. 5G is here – and shares of this ‘sleeping giant’ could be a great way for you to potentially profit!According to one leading industry firm, the 5G boom could create a global industry worth US$12.3 TRILLION out of thin air…And if you click here we’ll show you something that could be key to unlocking 5G’s full potential…This is by far the most significant challenge all companies face. No industry is exempt. For example, 10 years ago, Arcadia was one of the most successful retailers in the world. Today what’s left of it has been carved up after it collapsed last year. Arcadia’s mistake was missing out on the online retail revolution.At the same time, oil producers such as Tullow Oil have been wrong-footed by the falling price of oil. New technologies have allowed companies to extract oil faster and in previously uneconomic regions. Food and drink retailing is not immune to change, but it’s insulated to a certain extent. Consumers will always need to eat and drink, so the market will always be there. Therefore, companies that can deliver products to where consumers want them at the lowest costs should have a guaranteed market. Tesco has been supplying food and drink to UK consumers for decades. Today, it’s the largest retailer in the UK, with a virtually unrivalled distribution and store network.As long as the company continues to invest in its store network and distribution system, I think it should stay on top. This suggests the outlook for Tesco shares is favourable in the long-run.That said, food and drink isn’t a rapid growth market. As such, I’m not expecting Tesco to generate market-smashing returns year after year. Instead, I think the company could be a great addition to my portfolio as a slow and steady income play.Buying Tesco sharesBased on the qualities outlined above, I’d buy Tesco as an income investment. The stock is set to support a dividend yield of 3.8% in 2021, rising to 4.7% in 2022.Of course, these are just projections at this stage. There’s no guarantee the corporation will hit these targets. Still, I think the projections show the company’s potential as an income investment. That’s not to say the company doesn’t face challenges. As well as the hurdles outlined above, the businesses may also face problems if costs rise substantially. That would put pressure on profit margins and may limit its ability to return cash to investors. Despite these risks, considering the company’s defensive nature, I believe Tesco shares are one of the best income plays to buy right now for the long term. I think the stock is unlikely to generate outstanding returns, but it’s also unlikely to produce significant losses, in my opinion. That’s why I’d buy the corporation today. Enter Your Email Address I would like to receive emails from you about product information and offers from The Fool and its business partners. Each of these emails will provide a link to unsubscribe from future emails. More information about how The Fool collects, stores, and handles personal data is available in its Privacy Statement. Renowned stock-picker Mark Rogers and his analyst team at The Motley Fool UK have named 6 shares that they believe UK investors should consider buying NOW.So if you’re looking for more stock ideas to try and best position your portfolio today, then it might be a good day for you. Because we’re offering a full 33% off your first year of membership to our flagship share-tipping service, backed by our ‘no quibbles’ 30-day subscription fee refund guarantee.last_img read more