Who wouldn’t want a million dollar nest egg when they retire?
According to a recent CNBC survey, only 16% of respondents said they had that much money when they retired, and that’s counting all assets. But if you want to get there, the easiest way is to set aside money and invest it in the stock market. You can also buy index funds, such as an index fund that tracks the S&P 500. That strategy is fairly safe in the long run and virtually guarantees you returns commensurate with the market.
Alternatively, you can build a portfolio of individual stocks yourself. Doing so may increase your return on investment, but it also comes with a higher risk of underperforming the market and incurring losses.
If you’re ready to take the risk of the second approach and are looking for tech stocks that could help you become a millionaire in retirement, check out these stocks that could quadruple in value over the next 10 years. I’d like to introduce three stocks that I think are. Without multiple expansions, profits need to increase by 15% per year, which is within reach. If you split a $250,000 investment between two people, such growth would result in a $1 million portfolio in 2034.
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1.ASML
ASML (NASDAQ: ASML) has one of the broadest economic moats in the high-tech space. The company manufactures lithography equipment used in semiconductor manufacturing and is the only company capable of producing the most advanced version of that equipment, the extreme ultraviolet (EUV) lithography system. In other words, these are the only machines capable of producing today’s cutting-edge, component-dense chips.
ASML has built its technological edge thanks to generations of research and development and consistent investment in technological advancements. It will be difficult for rivals to catch up at this point. This competitive advantage could help drive ASML’s outperformance in the coming years, as demand for ASML’s machines is expected to increase thanks to AI-driven demand for cutting-edge chips. It should be helpful.
The company’s market cap already stands at $332 billion, and if it were to rise 300% over the next 10 years, it would have a market cap of $1.33 trillion. And while there are only seven companies on the market today with multi-trillion dollar valuations, that goal is within ASML’s reach given the production increases occurring in the semiconductor industry.
Additionally, ASML brings benefits. At its current share price, the yield is modest at just 0.8%, but by reinvesting those dividends, investors could potentially reach their goals a little faster.
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2. Arm Holdings
Arm Holdings (NASDAQ: ARM) is another interesting tech stock that has the potential to make you a billionaire over the next decade.
Like ASML, Arm has unique competitive advantages that make it well positioned to ride the AI boom. Unlike many other chip inventory companies, Arm doesn’t design its own chips. Instead, the company licenses its technology to companies like Apple and Nvidia, which use its architecture in their own chips. Arm’s components are particularly prized in smartphones because they consume much less power than competing products such as Intel and AMD’s x86.
This energy-saving aspect also makes Arm’s products popular among data center operators, as running AI applications requires huge amounts of power, and savings at scale can be significant. That’s why I’m here.
Finally, Arm generates broad operating margins thanks to its technology and unique business model, and is likely to benefit from new product rollouts and surging demand for AI. The company looks set to grow its profits by at least 15% each year and maintain its high profit margins.
3. Trade Desk
The strong growth in digital advertising is likely to continue as companies shift marketing budgets from traditional advertising to digital channels and brands explore new ways to reach customers. One company well positioned to take advantage of that opportunity is The Trade Desk (NASDAQ: TTD), a leading independent demand-side advertising technology platform.
Trade Desk has long outperformed both its ad tech peers and the broader market. And the company should continue to take full advantage of the growth in the digital advertising market thanks to its new AI platform, Kokai. The product allows customers to easily track and measure the performance of their advertising campaigns, allowing them to adjust campaigns based on customer behavior and helping advertisers make better decisions.
Trade Desk has a track record of delivering growth even during times when advertisers are tightening their grip, 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 is certain that earnings per share will quadruple over the next 10 years.
Don’t miss this potentially lucrative second chance
Have you ever felt like you missed out on buying the most successful stocks? Then you’ll want to hear this.
On rare occasions, our team of expert analysts will issue a “Double Down” stock recommendation on a company we think is about to crash. If you’re already worried that you’re missing out on an investment opportunity, now is the best time to buy before it’s too late. And the numbers speak for themselves.
Amazon: If you invested $1,000 when it doubled in 2010, you’d get $21,266!*
Apple: If you invested $1,000 when it doubled in 2008, you would have earned $43,047. *
Netflix: If you invested $1,000 when it doubled in 2004, you would have earned $389,794. *
We currently have “double down” alerts on three great companies, and we may not see an opportunity like this again anytime soon.
See 3 “Double Down” stocks »
*Stock Advisor will return as of October 7, 2024
Jeremy Bowman has a position at The Trade Desk. The Motley Fool has positions in and recommends ASML, Advanced Micro Devices, Apple, Nvidia, and The Trade Desk. The Motley Fool recommends Intel and recommends the following options: November 2024 $24 short calls on Intel. The Motley Fool has a disclosure policy.
Want a $1 million nest egg by the time you retire? Invest $250,000 in these three stocks and wait 10 years. Originally published by The Motley Fool
