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2 magnificent stocks that have created many millionaires and will continue to make more
O Nasdaq Composite The index has risen about 118% over the past five years, despite the COVID-19 pandemic and an economic recession in 2022. The figure illustrates how profitable it can be to invest in certain companies and hold them even in unfavorable market conditions.
Consequently, it’s not a bad idea to invest in some of the most prominent players in the Nasdaq Composite, with plans to hold them for many years. Being the second and sixth most valuable companies in the world, Litter (NASDAQ:AAPL) and Amazon (NASDAQ: AMZN) are two attractive options.
These companies dominate their respective industries and have created many millionaires over the years, with Apple shares up 319% since 2019 and Amazon shares up 96%. Meanwhile, Apple and Amazon have some interesting developments in the works that could generate big gains in the coming years.
So here are two magnificent stocks that have created millionaires and will continue to make more.
1. Amazon
One of the most attractive aspects of Amazon is its completely diversified business model. The company is best known as the king of e-commerce, with its industry-leading 38% market share. Amazon’s dominance in online retail is demonstrated by Wal-Martthe second largest market share in e-commerce, accounting for just 6% of the sector.
Amazon’s retail business continues to be a profitable venture, with revenue in the North American and International segments increasing 12% year over year and 10% in the first quarter of 2024. Meanwhile, retail operating income reached $6 billion combined, improving significantly from negative $349. million posted in the previous year’s quarter.
However, Amazon is much more than e-commerce. The company is headquartered the largest cloud platform in the world, Amazon Web Services (AWS), which reported 17% year-over-year sales growth in the first quarter of 2024 (its largest increase in a year). AWS operating profit rose 84% to more than $9 billion during the quarter, with the cloud service accounting for 62% of Amazon’s total operating profit despite earning the smallest share of revenue among its three main segments.
In addition to stellar retail and cloud growth, the first quarter of 2024 suggested the company could have a profitable future in digital advertising – a market largely dominated by Alphabet It is Metaplatforms. The quarter saw revenue from advertising services soar 24%, with much of that growth thanks to the introduction of ads on the Prime Video streaming service.
Amazon shares trade at about 40 times forward earnings, indicating that it’s not exactly a bargain. However, the company’s shares have already risen 20% year to date. Coupled with the potential for significant growth across multiple markets, Amazon stock is likely worth its premium price and could make you a millionaire with the right investment.
The story continues
2. Apple
Apple has a long history of providing loyal investors with consistent and significant gains. However, repeated impacts on its business and concerns about product sales have caused its shares to fall 1% since the start of 2024. The company’s long-term relevance has been questioned as product sales decline and crucial markets like China increasingly prefer domestic offerings to Apple’s.
However, Apple is taking steps to boost its product business with the help of artificial intelligence (AI). Meanwhile, a rapidly expanding services business is gradually allowing the company to rely less on product sales.
Apple shares have soared 16% over the past month, almost entirely thanks to its expansion efforts in AI. The company rallied investors in early May when it launched its newest iPad Air. The tablet is the first device to use Apple’s most powerful chip, the M4, which greatly expands the company’s AI capabilities.
Additionally, Apple plans to revamp its Mac lineup and aspects of its smartphones to better meet growing demand for AI services.
Despite recent headwinds, Apple remains a giant in consumer technology. Billions of consumers continue to choose its products over rival devices, giving the company ample opportunity to promote its AI products.
In addition to a strong perspective on AI, Apple’s digital services division is booming. In Q2 2024 (ending March 2024), the segment recorded 14% year-over-year revenue growth, significantly outperforming all other segments. The services trajectory is promising for Apple’s future, as it allows the company to rely less on its product business over time, strengthening it against macroeconomic headwinds.
With a P/E ratio of 29, there may be more valued options than Apple. However, the number is significantly lower than Amazon’s 40 and Microsoftis 36, potentially making Apple one of the most valued AI stocks. In addition to a powerful position in technology, Apple is worth considering right now and a position that could make you a millionaire.
Should you invest $1,000 in Amazon right now?
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Randi Zuckerberg, former director of market development and spokesperson for Facebook and sister of Meta Platforms CEO Mark Zuckerberg, is a member of The Motley Fool’s board of directors. Suzanne Frey, an Alphabet executive, is a member of The Motley Fool’s board of directors. John Mackey, former CEO of Whole Foods Market, an Amazon subsidiary, is a member of The Motley Fool’s board of directors. Daniel Cook has no position in any of the stocks mentioned. The Motley Fool has positions and recommends Alphabet, Amazon, Apple, Meta Platforms, Microsoft and Walmart. The Motley Fool recommends the following options: long January 2026 $395 calls on Microsoft and short January 2026 $405 calls on Microsoft. The motley fool has a disclosure policy.
2 magnificent stocks that have created many millionaires and will continue to make more was originally published by The Motley Fool