High-quality companies with durable earnings growth can be wealth-building powerhouses that lift a portfolio over time. Most people who retire with high net worths have likely enjoyed stellar returns from their stock investments.
Importantly, investors shouldn’t bet too heavily on one horse — a diversified portfolio is critical to managing your risks. That said, there are some stocks that you can buy and hold for the next decade that could make a notable difference in the growth of your nest egg.
Here are two such names. Consider investing $10,000 into each of these stocks, and they could help you retire a millionaire.
Amazon will continue enjoying e-commerce and cloud tailwinds
What a business Amazon (NASDAQ: AMZN) is. The company started by selling books online in the mid-1990s and is today’s dominant e-commerce retailer, with a roughly 38% market share in the United States. Perhaps even more impressive is that Amazon followed up this whopper of an opening act with Amazon Web Services, which has become the world’s largest cloud infrastructure platform with a 31% global market share.
The company has been a very successful long-term investment. A $10,000 investment into Amazon stock in its early days would be worth over $18 million now. Of course, Amazon is now worth nearly $2 trillion, so there’s just no room in the global economy for it to increase in size and value by that magnitude again. However, the company does still have enough upside to justify a $10,000 investment today. Amazon’s bread-and-butter segments, e-commerce and cloud computing, have plenty of room to grow. E-commerce is still just 16% of retail in America. Meanwhile, the surge in artificial intelligence investments worldwide should mean big things for Amazon and other cloud platforms.
AMZN Price to CFO Per Share (TTM) Chart
A massive company like Amazon must also be trading at the right valuation in order to have the potential to generate additional big returns. Let’s check that box off. If you value Amazon based on its operating cash flow — in other words, the cash it generates from its normal…
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