It's tempting to try to pick stocks that you think might double or triple in value in a year or two. However, the best benefits often come later, and sometimes they can come in unexpected ways. This is why investing in multiple stocks can be an effective strategy because it is almost impossible to predict where a business may end up over time. If you hit it big with a few stocks, that can make up for the underperformance in other areas of your portfolio.
Nvidia (NASDAQ: NVDA), Advanced Micro Devices (NASDAQ: AMD)again Tesla (NASDAQ: TSLA) They are three of the best stocks to invest in over the last ten years. Investing $10,000 in each of the three assets 10 years ago would have produced a portfolio worth more than $3.4 million today. Here's a look at how valuable some of these investments are today, why they've done so well, and why these stocks are still good buys right now.
Nvidia is a great example of how investing in a strong growth stock can pay off in unexpected ways in the future. Ten years ago, no one knew about chatbots or the role Nvidia might play in developing next-generation technology with its artificial intelligence (AI) chips. Today, however, it has become one of the most valuable companies in the world, with a market capitalization of approximately $3.2 trillion. If you invested $10,000 in stocks 10 years ago, that investment would be worth a staggering $2.7 million now.
A few years ago, the company's sales and profits started. In its fiscal year ended Jan. 28, 2024, Nvidia's sales topped $60.9 billion — more than triple the $16.7 billion it reported three years earlier. Its profit alone ($29.8 billion) in the last financial year was more than its profit during that period.
Nvidia is still a top growth stock to own, given the many opportunities in AI and its leadership position in the field. It may not be able to replicate its impressive returns over the next 10 years, but you can still reap huge profits by holding Nvidia stock in your portfolio for the long term.
Advanced Micro Devices, also known as AMD, is one of Nvidia's main competitors, and, again, it was the top growth stock to own this past decade. A $10,000 investment in AMD ten years ago would have grown to over $440,000 today.
AMD is much smaller than Nvidia, but it has also experienced significant growth over the past few years. From nearly $10 billion in sales in 2020, the company has now generated $24.3 billion in revenue over the past four quarters.
The chip maker has struggled in recent years amid investor concerns about whether it can keep up with Nvidia and if its AI chips will be able to capture significant market share. However, given the significant opportunities that exist in AI, there should be plenty of room for AMD to claim a piece of the pie if for some reason companies don't want to be completely dependent on Nvidia's chips for their technology.
It may be a bumpy ride for AMD, but I think it could still be a good buy today.
Rounding out this list is a growing list of impressive electric vehicle (EV) maker Tesla. The company's ambitions are more important than making EVs, as Tesla aims to have a big name in AI and plans to make robots in the future.
If you were to invest $10,000 in Tesla stock ten years ago, however, it would be for its EV-related growth opportunities. That investment would be worth about $290,000 today. In total, the three investments listed here will now be worth approximately $3.4 million.
Tesla has also grown significantly in recent years on both its top and bottom lines. Revenue of $31.5 billion in 2020 more than tripled to $97.2 billion over the next 12 months. The company's revenue increased from $690 million back then to more than $12.7 billion during its last four quarters.
This has the potential to be a high-growth stock in the coming years, but much depends on Tesla's strategy outside of EVs; The company's margins have been coming under pressure for a while, and consumers have more options to choose from.
Tesla is the riskiest stock on this list, and the one I would hold off on buying for now, given the challenges it faces.
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See 3 “Double Down” Stocks »
*Stock Advisor returns from 13 January 2025
David Jagielski has no position in any of the stocks mentioned. The Motley Fool has positions and recommends Advanced Micro Devices, Nvidia, and Tesla. The Motley Fool has a policy of disclosure.
Investing $10,000 in These 3 Growth Stocks 10 Years Ago Would Have Created a Portfolio Worth $3.4 Million Today was originally published by The Motley Fool.
