the Nasdaq Composite The index has risen by about 118% over the past five years despite the Covid-19 pandemic and the economic downturn in 2022. This figure shows how profitable it is to invest in some companies and hold them even in bad market conditions.
Therefore, it is not a good idea to invest in some of the top players in the Nasdaq Composite that you have plans to hold for many years. As the second and sixth most valuable companies in the world, apple (Nasdaq: Apple) And Amazon (Nasdaq: AMZN) There are two attractive options.
These companies dominate their respective industries and have created many millionaires over the years, with Apple shares rising 319% since 2019 and Amazon shares rising 96%. Meanwhile, Apple and Amazon have some exciting developments in the works that could pay big dividends 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 quite diverse business model. The company is known to be king E-Commerce, with a leading market share of 38% in the industry. Amazon's dominance in online retail is demonstrated by… WalmartThe second largest market share is in e-commerce, representing only 6% of this sector.
Amazon's retail business remains a profitable venture, with revenue in its North American and international segments up 12% year over year and 10% in the first quarter of 2024. Meanwhile, retail operating income generated a total of $6 billion, a significant improvement over With the negative number $349. million published in the quarter last year.
However, Amazon is much more than just e-commerce. The company is home to The world's largest cloud platform, Amazon Web Services (AWS), which posted 17% year-over-year sales growth in the first quarter of 2024 (its biggest rise in a year). AWS's operating income rose 84% to more than $9 billion during the quarter, with the cloud service accounting for 62% of Amazon's total operating income despite having the smallest portion of revenue among its three major segments.
In addition to stellar growth in retail and cloud, the first quarter of 2024 indicated that the company could have a lucrative future in digital advertising – a market it mostly dominates. the alphabet And Meta platforms. This quarter saw advertising revenue rise by 24%, with most of this growth due to advertising on the Prime Video streaming service.
Amazon stock is trading at about 40 times its forward earnings, suggesting it's not quite a bargain. However, the company's stock is actually up 20% year to date. Combined with great growth potential in multiple markets, Amazon stock is likely worth its premium price and could make you a millionaire with the right investment.
2. Apple
Apple has a long history of providing loyal investors with consistent and large gains. However, repeated hits to its business and concerns over product sales have sent its shares down 1% since the start of 2024. The company's long-term relevance has been called into question as product sales decline and crucial markets like China increasingly prefer local offerings over Apple's.
However, Apple is taking steps to boost its product business with the help of artificial intelligence (AI). At the same time, the rapidly expanding services business allows the company to rely less on product sales.
Apple shares have risen 16% in the past month, almost entirely due to its increased efforts in artificial intelligence. The company mobilized investors in early May when it debuted its latest iPad Air. The tablet is the first to use Apple's most powerful chip yet, the M4, which is said to significantly expand the company's AI capabilities.
Additionally, Apple plans to revamp its Mac lineup and aspects of its smartphones to better meet the growing demand for AI services.
Despite recent headwinds, Apple remains a consumer technology giant. Billions of consumers continue to choose its products over competing devices, giving the company a huge opportunity to promote its AI products.
In addition to strong expectations in artificial intelligence, Apple's digital services division is booming. In the second quarter of 2024 (ending March 2024), the sector recorded revenue growth of 14% year-on-year, significantly outperforming all other sectors. The services path is promising for Apple's future because it allows the company to rely less on its product business over time, inoculating it against macroeconomic headwinds.
With a price-to-earnings ratio of 29, there may be better value options than Apple. However, the number is much lower than Amazon's figure of 40 and Microsoft36, which could make Apple one of the best value AI stocks. In addition to its strong position in technology, Apple is worthy of attention now, and is a company that can make you a millionaire.
Should you invest $1,000 in Amazon now?
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Randi Zuckerberg, former director of market development and spokeswoman for Facebook and sister of Meta Platforms CEO Mark Zuckerberg, is a member of The Motley Fool's board of directors. Susan Frey, an executive 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 He has no position in any of the stocks mentioned. The Motley Fool has positions in and recommends Alphabet, Amazon, Apple, Meta Platforms, Microsoft, and Walmart. The Motley Fool recommends the following options: long $395 January 2026 calls on Microsoft and short $405 January 2026 calls on Microsoft. The Motley Fool has Disclosure policy.
2 Great stocks that have created many millionaires and will continue to make more Originally published by The Motley Fool