3 stocks you can safely buy now for $300

Over the past month, Wall Street has been reminding investors that stocks do not rise in a straight line. In particular, growth-driven Nasdaq-Composite lost about 1,400 points, or 8% of its value, during the first three trading sessions in August.

While stock market corrections can be unpredictable and sometimes unsettling, they have also historically been the ideal time for opportunistic long-term investors to pounce on high-quality companies at a discounted price. Ultimately, every correction, bear market, and crash has been eclipsed by a bull market rally.

Image source: Getty Images.

What makes things even more favorable for patient investors is the fact that most online brokers have removed the hurdles that once prevented retail investors from growing their wealth on Wall Street. With minimum deposit requirements and commission fees for trading ordinary stocks largely a thing of the past, any amount – even $300 – can be the perfect amount to put to work in the stock market.

If you have $300 available to invest and are sure you won’t need that amount to pay bills or for an emergency, the following three stocks are a clear buy right now.

Disney

The first unstoppable company that investors can now confidently add to their portfolio for $300 is none other than the media giant Disney (DIS -0.41%).

Disney has faced headwinds from seemingly all sides over the past four years. The company is battling the COVID-19 pandemic, which is hurting its studio and theme park operations, and has been forced to spend heavily on its direct-to-consumer (DTC) streaming services as more and more cable TV is canceled. To say it’s been a rough start to the decade for the company would be an understatement.

However, Walt Disney’s competitive advantage and visible signs of operational improvement suggest that the future looks bright for the so-called “House of Mouse.”

Disney’s greatest competitive advantage is its irreplaceability in the entertainment space. While there is no shortage of theme parks, cruise lines, streaming services and movie studios, none of them have the depth of stories, characters and emotional stakes that Disney has evoked over the past century. Investors are happy to pay a premium for a company whose branding ensures its continued success.

Another reason for potential investors to be excited about Disney’s long-term prospects is the significantly improved results of its streaming segment. Modest subscriber growth combined with rising monthly subscription costs for DTC services helped Disney’s streaming segment post quarterly operating profit compared to the same period last year. Management had previously targeted recurring profits for its DTC segment by the fourth fiscal quarter, which ends in late September.

The final piece of the puzzle for Walt Disney is its attractive valuation. Despite some notable slowdowns in consumer spending in the company’s “experiences” segment, Disney’s streaming, ESPN and studio operations have all performed better than expected. At a current price-to-earnings (P/E) ratio of 16.8, Disney stock is valued at a 37% discount to the average P/E ratio over the past five years.

Image source: Getty Images.

Octa

A second great stock to buy now if you have $300 to invest is cybersecurity solutions provider Octa (OKTA 0.87%).

Although all eyes are on CrowdStrike Holdings Following the Falcon update chaos that took several airlines and financial services providers offline, Okta was thrust into the spotlight last October when hackers broke into the platform and stole customer information. While security breaches are never a good thing, the negative PR and revenue losses that come with such incidents are historically short-lived.

The good news for cybersecurity companies is that their products and services have become basic necessities. With companies moving their data online and to the cloud at an accelerated pace since the pandemic began, it’s more important than ever for companies to protect their data and that of their customers in any economic climate. For subscription-based companies like Okta, this typically translates into predictable operating cash flow quarter after quarter.

What sets Okta apart is the company’s cloud-native, artificial intelligence (AI) and machine learning-based identity verification platform. While October’s data breach shows that more improvements are needed, AI platforms that get smarter and more effective over time should easily outperform on-premises solutions.

One of the more impressive metrics for Okta has been its ability to upsell and attract bigger fish. As fiscal 2022 came to a close (Okta’s fiscal year ends Jan. 31), 20.7% of the company’s roughly 15,000 customers had an annual contract value (ACV) of over $100,000. In the first quarter of fiscal 2025, nearly 24% of its 19,100 customers had an ACV of at least $100,000. By acquiring larger customers and upselling existing ones, its backlog has increased 14% year over year to $3.36 billion.

Although Okta’s P/E ratio of 33 is aggressive on paper, the company is expected to grow its earnings per share (EPS) by an average of 25%. per year until 2028. This makes Okta a real bargain.

alphabet

The third stock that you can buy immediately for $300 is the component “The Magnificent Seven” alphabet (GOOGL 1.15%) (GOOG 1.21%)This is, among other things, the parent company of the Internet search engine Google, the streaming service YouTube and the cloud infrastructure service platform Google Cloud.

The biggest headwind that current and prospective investors need to consider with Alphabet is the health of the U.S. and global economies. About 76% of the company’s $84.7 billion in second-quarter revenue came from advertising. Companies aren’t afraid to cut their marketing budgets when they see early signs of trouble. If the U.S. economy were to enter a recession, it would be expected to have a negative impact on Alphabet’s advertising revenue.

On the other hand, patience is precisely what has made Alphabet such a phenomenal company. Of the twelve recessions in the US since the end of World War II, nine were overcome in less than twelve months. In comparison, most growth phases lasted several years, with two expansions reaching the 10-year mark. The advertising climate is in most cases conducive to growth.

Alphabet’s fundamental business segment remains its internet search engine. In July, Google held 91% of the global internet search market share, according to data from GlobalStats. Because Google has had a virtual monopoly on internet search for more than a decade, the company has extraordinary power in pricing ads.

However, Alphabet’s future depends heavily on the growth of Google Cloud. Enterprise spending on cloud services is still in a very early stage of expansion. Google Cloud has already reached a 10% share of global spending on cloud infrastructure services (as of the end of 2023), and the margins associated with cloud services are significantly higher than those associated with advertising. Since Google Cloud accounts for a larger share of Alphabet’s total revenue, operating cash flows should benefit greatly.

Staying on topic, Alphabet stock is also historically cheap. Opportunistic investors can currently buy shares for less than 19 times expected annual earnings, a 21% discount to expected annual earnings over the past five years.