Jasmine Birtles
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What Are the Best Stocks to Buy for 5 Years Growth?
Moneymagpie Team
19th Oct 2026
Five years is a sweet spot for investing. It is long enough to ride out a wobbly patch or two, but short enough that you can still picture what you will do with the money. If you are wondering where to start, you are in good company.
In this guide you will learn why five years changes the way you pick stocks, five types of stock worth researching with real examples in each, and the simple steps to get started. New to all this? Our guide to the best investments for beginners in the UK covers the basics.
How should you pick stocks for a 5 year horizon?
A stock (also called a share) is a tiny slice of ownership in a company. Over five years, what tends to matter is whether the business keeps growing its sales and profits, not whether the share price jumps around next week.
That points towards companies with strong market positions, steady demand and healthy finances, and towards spreading your money across different types of business rather than backing one big idea. It also helps to keep costs low and to avoid investing money you might need within the five years. Share prices can fall, sometimes sharply, and five years is not long enough to guarantee a recovery.
A quick note on the examples below. They are well-known companies we have chosen to illustrate each category, not recommendations to buy. Facts come from the companies’ own results pages, dated to their latest reports, and things change fast.
The 5 best types of stock for 5 years growth
1. Global quality compounders
These are big, established businesses that have been good at turning sales into growing profits year after year. Think of firms that sit in the middle of how the world pays, shops or communicates, and that are hard for rivals to copy. Compounding simply means profits are reinvested to earn more profits, which can snowball over time.
Examples to research: Visa, which runs one of the world’s biggest card payment networks, and Mastercard, its main rival. Both earn from the volume of payments flowing through their networks rather than lending money themselves.
Key risk: they are valued highly because they are well loved, regulators are looking closely at card fees, and both are US shares, so the pound-dollar exchange rate affects what you get back.
2. Big tech and AI leaders
Technology has powered much of the stock market for years, and AI is the latest chapter. Over five years, the businesses best placed are usually the ones with big cash piles and several revenue streams, not just one hot product.
Examples to research: Microsoft, which reported revenue of $90.0 billion for its latest quarter, up 18% on a year earlier, with its Azure cloud business up 43%. Alphabet, the owner of Google, is another giant to look at. Key risk: this is the most volatile group on the list. Chip and AI shares have just had a rough run, which we explain in our look at what the AI selloff means for UK investors, and a bubble worry could hit these shares hard again.
3. UK dividend payers
A dividend is a share of profits that a company pays to its shareholders, usually once or twice a year. Reinvesting dividends can add up over five years, which is why steady payers are popular with long-term investors.
Our guide on how to start stock investing as a complete beginner explains how this works in practice.
Examples to research: National Grid, which owns and runs electricity and gas networks and paid a final dividend of 32.14p per share in July 2026, and Unilever, the consumer goods giant. Unilever reported underlying sales growth of 4.8% for the first half of 2026 and is combining its food business with McCormick to focus on home and personal care.
Key risk: dividends are never guaranteed, can be cut, and the share price can still fall. You may also owe tax on dividends outside an ISA, so check the GOV.UK guidance on tax on dividends.
4. Healthcare and pharmaceuticals
People need medicine in good times and bad, and populations are getting older. That gives healthcare companies a steadier demand story, which can make them a calmer part of a portfolio when markets are choppy.
Examples to research: AstraZeneca, the UK-listed drugmaker, which reported first-half 2026 revenue of $30.7 billion, up 6% at constant exchange rates, raised its interim dividend to $1.06 per share and says it is on track for its ambition of $80 billion in revenue in 2030. Johnson & Johnson is a large US healthcare group worth a look too.
Key risk: a drug trial failure, patent expiry or a change in drug pricing rules can hit the whole sector.
5. Global index funds and ETFs as your core
Strictly speaking this is not a stock, but for many beginners it is the smartest place to start. A fund such as the Vanguard FTSE All-World UCITS ETF holds thousands of companies in one purchase, so no single business can sink you. You can then add individual stocks around the edges if you fancy it. Learn more in our guide on how to invest in index funds.
Key risk: a fund simply follows the market, so if global markets fall, so does your fund. Fees vary, so compare the ongoing charge on the fund provider’s own factsheet.
Where to buy stocks in the UK
You need an investment platform to buy shares. Options worth a look include Trading 212, which charges no commission on shares and ETFs, Hargreaves Lansdown, interactive investor and InvestEngine, which is popular for ETF investing.
Prefer to leave it all to the experts? Wealthify offers ready-made portfolios.
Compare fees, ISA options and fund choice in our best investment platforms in the UK compared guide.
Whichever you choose, think about holding your stocks inside a Stocks and Shares ISA. You can invest up to £20,000 a year, and gains and income are free of UK tax, as the GOV.UK ISA guidance explains.
You can open a Trading 212 Stocks ISA or browse our round-up of the best Stocks and Shares ISAs. For an impartial explainer, see MoneyHelper’s guide to Stocks and Shares ISAs.
What to do next
- Decide how much you can leave alone for five years. Only invest money you will not need in that time.
- Choose a core. For many beginners that means a global index fund or ETF first, with individual stocks as a smaller extra.
- Spread your picks across at least three of the categories above, so one bad story does not sink everything.
- Open a Stocks and Shares ISA with a platform whose fees you have compared and understood.
- Invest regularly rather than all at once. A set amount each month smooths out the bumps. Start small, be patient.
- Check in once or twice a year, not every day. Our investing questions answered guide is a handy bookmark.
Bottom line
There is no single best stock for five years of growth, but there are sensible types of stock to research and a sensible way to build a mix. Pick businesses you understand, keep costs low, spread your bets and give your money time.
Disclaimer: This article is for informational and educational purposes only and is not regulated financial advice. The companies named are examples, not recommendations. Investing involves risk, you may get back less than you put in, and past performance is not a guide to the future. Tax treatment depends on your circumstances and may change. Do your own research or speak to a regulated financial adviser before investing.
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