Who wouldn’t want to have $1 million in savings when they retire?
According to a recent CNBC survey, only 16% of respondents said they had that much when they retired – and that was counting all their assets. But if you want to achieve that, the easiest way to do it is to put money aside and invest it in the stock market. You can choose to buy index funds, such as funds that track the price S&P500 — that strategy is quite safe in the long run and essentially gets you returns that match the market.
Or you can build yourself a portfolio of individual stocks. That may yield a better return on your investments, but it’s a choice that carries more risk of underperforming the market and losing money.
If you’re willing to take the risks of that second approach and are looking for tech stocks that could help you become a millionaire in retirement, here are three stocks that I think have the potential to be a winner in the next decade. quadruple value. Without any form of multiple expansion, that would require them to grow their profits by 15% per year – and that is within their reach. Divide a $250,000 investment between them, and that kind of growth would give you a $1 million portfolio by 2034.
1. ASML
ASML (NASDAQ: ASML) has one of the widest economic moats in the technology sector. It makes the lithography equipment used to manufacture semiconductors, and it is the only company that can make the most advanced versions of that equipment: extreme ultraviolet (EUV) lithography systems. These, in turn, are the only machines that can make today’s most advanced, high-component-density chips.
ASML has built its technological lead through a generation of research and development and consistent investments in advancing its technology. At this point it will be difficult for rivals to catch up. That competitive advantage should drive ASML’s outperformance in the coming years, as demand for its machines will grow thanks to AI-driven demand for the most advanced chips.
The company’s market cap is already $332 billion, meaning if it gains 300% over the next ten years, it would have a market cap of $1.33 trillion. And while there are currently only seven companies in the market with trillion-dollar valuations, given the ramping up of production in the semiconductor industry, that goal is within reach for ASML.
ASML also pays out dividends. It’s modest, yielding just 0.8% at the current share price, but reinvesting these payouts could help investors reach their goals a little faster.
2. Gun ownership
Arm positions (NASDAQ:ARM) is another intriguing tech stock with the potential to make you a millionaire in the next decade.
Like ASML, Arm has unique competitive advantages that make it a good candidate to ride the AI boom. Unlike most of its chipstock peers, Arm does not design its own chips. Instead, it licenses its technology to companies such as Apple And Nvidiathat use its architectures in their chips. Arm’s components are especially prized in smartphones because they consume much less power than competing options like the x86 Intel And AMD.
That energy-saving aspect also makes Arm’s products popular with data center operators, as running AI applications requires a huge amount of electricity and savings at scale can be significant.
Finally, Arm generates ample operating margins thanks to its technology and unique business model, and as it rolls out new products and demand for AI soars, it seems likely it will benefit. The company seems like a good bet to grow earnings at least 15% annually and maintain its high earnings multiple.
3. The Trading Desk
The robust growth of digital advertising appears likely to continue as companies shift more of their marketing budgets from conventional advertising to digital channels, and brands seek new ways to reach customers. One company well positioned to take advantage of this opportunity is The Trade Bureau (NASDAQ: TTD)the leading independent demand-side advertising technology platform.
The Trade Desk has long outperformed both its ad tech peers and the broader market. And it should continue to benefit from the growth of the digital advertising market thanks to its new AI platform, Kokai. This product makes it easier for customers to track and measure how their advertising campaigns are performing, allowing them to adjust campaigns in response to customer behavior and helping advertisers make better decisions.
The Trade Desk has a track record of delivering growth even during periods of advertiser belt-tightening, and the company should be able to take advantage of new platforms and media channels as they evolve over the next decade. Based on the company’s history, it’s a good bet to quadruple earnings per share over the next decade.
Don’t miss this second chance at a potentially lucrative opportunity
Have you ever felt like you missed the boat on buying the most successful stocks? Then you would like to hear this.
On rare occasions, our expert team of analysts provides a “Double Down” Stocks recommendation for companies they think are about to pop. If you’re worried that you’ve already missed your chance to invest, now is the best time to buy before it’s too late. And the numbers speak for themselves:
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Amazon: If you had invested $1,000 when we doubled in 2010, you would have $21,266!*
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Apple: If you had invested $1,000 when we doubled in 2008, you would have $43,047!*
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Netflix: If you had invested $1,000 when we doubled in 2004, you would have $389,794!*
We’re currently issuing ‘Double Down’ warnings for three incredible companies, and another opportunity like this may not happen anytime soon.
See 3 “Double Down” Stocks »
*Stock Advisor returns October 7, 2024
Jeremy Bowman holds positions at The Trade Desk. The Motley Fool holds positions in and recommends ASML, Advanced Micro Devices, Apple, Nvidia, and The Trade Desk. The Motley Fool recommends Intel and recommends the following options: Short November 2024 $24 Calls on Intel. The Motley Fool has a disclosure policy.
Do you want a $1 million Nest Egg by retirement? Invest $250,000 in these three stocks and wait ten years. was originally published by The Motley Fool
