What is better, buying stock directly from a company's website or investing in a mutual fund?

I can only put in about $50/month or $700 in one lump sum. Stocks I am interested in are Lowe's, Corning (glass), Pfizer. I want moderate risk.

Buying stock directly from a company allows you to (potentially) avoid transaction fees. a mutual fund provides you diversification and professional management for a fee. These are two different beasts. If you feel strongly about a particular stock then you should buy it, otherwise, if you have a more long term investment strategy and seek diversification then a mutual fund provides more benefit. Also, don't forget that buying from the company directly can delay your ability to sell the stock as the company is not a market maker (like a brokerage) and you'll have to obtain the certificate, transfer it to a brokerage account, then sell it. Not usually worth the hassel for the reduction in fees to deal with companies on an individual basis.

buy blue chip like P&G but mutual funds are good as well get a long term one that will pay out when you retire.

Mutual Fund. Mutual fund generally is more diversified and thus not as risky as buying stock directly from a company. Of course, if you make up your own protfolio and diversify your purchases yourself, you should end up with a similar result.

Given the amount you have to invest, you would be best served with a mutual fund. You would not be able to adequately diversify with only $50/month. The performance of your entire portfolio would be tied to the performance of one or at best two companies. investing the same amount into a stock mutual fund would diversify your portfolio across 20 to 250 stocks.

The first step, however, is making sure you have at least three months worht of expenses set aside in a money market account. I know this is not nearly as attractive as setting up a brokerage account, but don't skip this step.

If you are a minimum wage worker ($5.15 USD PER HOUR) you are investing a ONE DAY OF YOUR SALARY PER MONTH.

I strongly suggest you to invest more and keep your investments in ETFs (Exchange Traded Funds) until you have at least $2,000.00

Drop me a line when you are ready to move to the next level.