The Nasdaq Composite The index is up about 118% over the past five years, despite the COVID-19 pandemic and an economic downturn in 2022. The figure illustrates how lucrative investing in certain companies and holdings can be even in poor market conditions.
That’s why it’s not a bad idea to invest in some of the most prominent players on the Nasdaq Composite, which have plans to hold them for many years to come. As the second and sixth most valuable companies in the world, Apple (NASDAQ: AAPL) And Amazon (NASDAQ: AMZN) are two attractive options.
These companies dominate their respective industries and have created many millionaires over the years: Apple’s shares are up 319% since 2019 and Amazon’s are up 96%. Meanwhile, Apple and Amazon have some exciting developments in the pipeline that could yield big profits in the coming years.
So here are two great stocks that have created millionaires and will continue to create more.
1. Amazon
One of the most attractive aspects of Amazon is its very diverse business model. The company is best known as the king of e-commerce, with an industry leading 38% market share. Amazon’s dominance in online retail is demonstrated by Walmart‘s second largest market share in e-commerce, responsible for just 6% of the industry.
Amazon’s retail business remains a lucrative business, with sales in its North American and International segments up 12% year-over-year and 10% in the first quarter of 2024. Meanwhile, retail operating revenues reached a combined $6 billion, a significant improvement from negative $349. million it recorded in last year’s quarter.
However, Amazon is much more than e-commerce. The company is home to the world’s largest cloud platform, Amazon Web Services (AWS), which reported 17% year-over-year revenue growth in the first quarter of 2024 (the largest increase in a year). AWS operating revenues rose 84% to over $9 billion during the quarter, with the cloud service responsible for 62% of Amazon’s total operating revenues, despite having the lowest share of revenue within the three major segments.
In addition to stellar growth in retail and cloud, the first quarter of 2024 suggested the company could have a lucrative future in digital advertising – a market primarily dominated by Alphabet And Metaplatforms. In the quarter, ad services revenues rose 24%, with much of that growth driven by the introduction of ads on streaming service Prime Video.
Amazon’s shares are trading at about 40 times their forward earnings, suggesting this isn’t exactly a bargain. However, the company’s shares are already up 20% year to date. In addition to significant growth potential in multiple markets, Amazon stock is likely worth the high price tag and could make you a millionaire with the right investment.
2. Apple
Apple has a long history of providing consistent and significant profits to loyal investors. However, repeated blows to the company and concerns about product sales have seen the shares down 1% since the start of 2024. The company’s long-term relevance has been called into question as product sales fell and crucial markets like China increasingly favor domestic offerings over Apple’s.
Still, Apple is taking steps to boost its product business with the help of artificial intelligence (AI). Meanwhile, a rapidly growing services company is gradually reducing the company’s dependence on product sales.
Shares of Apple are up 16% in the past month, thanks almost entirely to its increasing efforts in AI. The company gathered investors in early May when it debuted its latest iPad Air. The tablet is the first device to use Apple’s most powerful chip yet, the M4, which is said to vastly expand the company’s AI capabilities.
In addition, Apple plans to revamp its Mac lineup and certain aspects of its smartphones to better meet rising demand for AI services.
Despite recent headwinds, Apple remains a consumer technology behemoth. Billions of consumers continue to choose its products over competing devices, giving the company ample opportunity to showcase its AI products.
In addition to solid prospects in AI, Apple’s digital services division is booming. In the second quarter of 2024 (ending March 2024), the segment achieved 14% year-over-year revenue growth, significantly outperforming all other segments. The services path is promising for Apple’s future as it allows the company to become less dependent on the operations of its products over time, making it more resilient to macroeconomic headwinds.
With a price-to-earnings ratio of 29, there may be better valued options than Apple. However, the figure is significantly lower than Amazon’s Microsoft‘s 36, making Apple possibly one of the best-valued AI stocks. In addition to having a powerful position in the technology sector, Apple is worth considering right now and a position that could make you a millionaire.
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Randi Zuckerberg, former director of market development and spokeswoman for Facebook and sister of Mark Zuckerberg, CEO of Meta Platforms, is a member of The Motley Fool’s board of directors. Suzanne Frey, a director at Alphabet, 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. Dani Cook has no position in any of the stocks mentioned. The Motley Fool holds positions in and recommends Alphabet, Amazon, Apple, Meta Platforms, Microsoft and Walmart. The Motley Fool recommends the following options: long January 2026 $395 calls to Microsoft and short January 2026 $405 calls to Microsoft. The Motley Fool has a disclosure policy.
2 Great Stocks That Have Created Many Millionaires and Will Continue to Generate Even More Originally published by The Motley Fool
