3 Durable Stocks to Buy Now for the Long Term I January 26, 2026

Key Concepts

• USMCA: United States-Mexico-Canada Agreement – a trade agreement governing trade between these three countries.
• PCE: Personal Consumption Expenditures Price Index – the Federal Reserve’s preferred measure of inflation.
• Duration (of bonds): A measure of a bond’s sensitivity to changes in interest rates. Higher duration means greater price volatility for a given interest rate change.
• Carry Trade: Borrowing in a currency with low interest rates (like the Yen) to invest in assets with higher returns.
• Economic Moat: A company’s sustainable competitive advantage that protects it from competitors.
• Capex: Capital Expenditure – funds used by a company to acquire, upgrade, and maintain physical assets.
• Fair Value: An estimate of a stock’s intrinsic worth, calculated by Morningstar analysts.
• Star Rating: Morningstar’s assessment of a stock’s attractiveness, ranging from 1 (Sell) to 5 (Buy).

The Morning Filter Podcast – Three-Year Anniversary Summary

This summary details the key discussion points from the three-year anniversary episode of the Morning Filter podcast, featuring Susan Jabinsky, Dave Sakara, and guest Sarah Hansen. The episode covered market volatility, the Japanese bond market, the Federal Reserve’s outlook for 2026, earnings previews, and a review of Dave Sakara’s initial stock picks from the podcast’s launch.

I. Market Volatility & The Japanese Bond Market (JGBs)

The podcast began by acknowledging recent market volatility, with stocks experiencing a dip before recovering. Dave Sakara dismissed immediate geopolitical events (like Greenland acquisition talks and tariff threats) as the primary driver, anticipating continued volatility throughout 2026. He identified two key risks: trade negotiations (USMCA re-evaluation and China negotiations in spring/summer) and the weakening of Japanese Government Bonds (JGBs) and the Yen.

Sakara highlighted the significant movement in JGBs, with the 10-year yield reaching 2.35% (up from 1% a year ago) and the 40-year yield widening by 23 basis points in a single day. He explained the concept of duration – the 10-year JGB has a duration of over nine, meaning a 1% yield change equates to a 9% price change, while the 40-year JGB has a duration of 22, resulting in a 22% price change for a 1% yield change. The total amount of JGBs outstanding is $8.4 trillion, making any movement globally impactful.

While JGBs rebounded mid-week, Sakara questioned whether this was genuine investor buying or Bank of Japan intervention. He warned of two systemic risks for US investors: the unwinding of the carry trade (where investors borrow Yen at low rates to invest elsewhere) and potential solvency issues for Japanese insurance companies and banks due to falling bond prices, potentially mirroring the Silicon Valley Bank crisis of 2023.

II. The Federal Reserve in 2026

The discussion shifted to the upcoming Federal Reserve meeting and expectations for rate cuts. The PCE (Personal Consumption Expenditures Price Index) came in as expected, indicating inflation wasn’t worsening but wasn’t significantly improving. Sakara noted that GDP growth of 4.4% in Q3 and a 5.4% run rate for Q4 suggested inflation was surprisingly contained.

Currently, the market is pricing in a 0% probability of a rate cut this week, 15% in March, 30% in April, and 60% by June. Sakara maintains his view that the Fed won’t act unless there’s an exogenous shock to the market, predicting any cuts will likely occur after the new Fed chair takes over in May.

Guest Sarah Hansen elaborated on the divisions within the Fed, describing them as unusual and stemming from a “muddy economic picture” – cooling labor markets alongside persistent inflation and strong economic growth. She identified two opposing viewpoints: those favoring lower rates to stimulate growth and those prioritizing inflation control. Hansen emphasized that while divisions are normal, prolonged disagreement could erode the Fed’s credibility. She believes the Fed will remain “data dependent,” prioritizing the labor market but remaining sensitive to inflation. She also addressed concerns about Fed independence with the upcoming chair change and ongoing legal challenges.

III. Earnings Previews & Stock Picks

The podcast previewed earnings reports from several major companies:

• Microsoft (MSFT) & Meta (META): Both are four-star rated and trading at a 22% discount to fair value. Sakara views Microsoft as a core holding and Meta as a bet on AI. The key focus for both will be capex (capital expenditure) projections. Sakara presented data showing significant increases in projected capex for major hyperscalers, highlighting Meta’s projected $78 billion increase and Amazon’s jump to $134 billion.
• Apple (AAPL): Now a three-star stock after a price decline, the focus will be on AI integration plans and capex.
• Tesla (TSLA): A two-star stock with a 50% premium to valuation, requiring a new growth story beyond electric vehicles (e.g., robo-taxis, robotics) to justify its price.
• ServiceNow (NOW): Undervalued, but market concerns about AI disruption are holding back the stock.
• ASML (ASML): Benefiting from strong demand driven by Taiwan Semiconductor Manufacturing (TSM), with a fair value increase following TSM’s positive guidance.
• UPS (UPS): Showing signs of revival, with a focus on operating margin improvement and dividend sustainability.
• Colgate-Palmolive (CL): A former pick, now a three-star stock. Sakara seeks a return to organic sales growth and margin improvement.

IV. Revisiting Initial Stock Picks & New Recommendation

The podcast revisited Dave Sakara’s original three stock picks from the podcast’s launch:

• Berkshire Hathaway (BRK.B): Up 55%, underperforming the S&P 500. Still considered a buy, viewed as an actively managed ETF with significant private equity exposure.
• Amazon (AMZN): Up 145%, significantly outperforming the market. Remains a buy, with upside potential from AWS, retail margins, and advertising.
• Tesla (TSLA): Up 238%, dramatically outperforming the market but now overvalued due to the “Elon Musk premium.”

As a swap for Tesla, Sakara recommended Palo Alto Networks (PANW), a four-star stock trading at a 19% discount. He highlighted the importance of the cybersecurity industry and Palo Alto’s strong economic moat based on network effects and switching costs.

V. Conclusion

The episode provided a comprehensive overview of current market conditions, highlighting the risks associated with the Japanese bond market, the Federal Reserve’s cautious approach to rate cuts, and the importance of monitoring capex spending from major tech companies. The revisiting of initial stock picks offered valuable insights into long-term investment strategies and the need for ongoing portfolio adjustments. The podcast emphasized the importance of data-driven analysis and a long-term perspective in navigating market volatility.