The purchase and holding of solid technological companies are a proven way to earn money on the stock market, and this is not surprising because this strategy will allow investors to capitalize on disruptive growth trends that could help them excessive earnings.
This explains why the Nasdaq-100 technological sector The index has recorded 366% gains in the last decade, easily exceeding 196% gains recorded by the S&P 500 Index over the same period. Of course, put all your money in Technological stocks It may not be the best idea because the opposite winds that this sector is confronted could lead to large losses for investors.
However, some names in this sector are worthy of looking at more closely, because they are on the right track to make the most of the enormous opportunities in the final market. Nvidia (Nvda 0.10%)) And Meta-platforms (Meta 2.08%)) Among the dominant forces in the industries they serve, and buying them in the long term could prove to be an intelligent decision because they can help investors become much richer.
Let’s look at the reasons why.
1. NVIDIA
The nvidia semiconductor giant was an investment that changed life for anyone who bought it a decade ago and retained its investment. An investment of only $ 1,000 in NVIDIA shares 10 years ago is now worth $ 275,000. So, it will not be wrong to say that Nvidia would have definitively set up wise investors with foresight and patience to keep this flea manufacturer.
In recent times, there has been doubts about whether Nvidia could continue its stellar stock market. Concerns concerning a slowdown in expenses Artificial Intelligence (AI) Chips to revive competition with potential restrictions on sales of Nvidia fleas in foreign countries, there are a lot to take into consideration for investors if they seek to buy this flea manufacturer now.
However, investors would do well to pass beyond short-term factors weighing in recent times on Nvidia. The company has a massive addressable market beyond AI. Of course, AI is its largest growth engine at the moment, thanks to the dominant position of Nvidia in The GPU market in the data center (Graphic processing units), but there is a greater opportunity that is in advance in the form of accelerated calculation.
The CEO of NVIDIA, Jensen Huang, stressed last year that the transition from general data centers to accelerated IT is likely to open up An income opportunity of $ 1 billion for the company. Huang added that this transition will occur regardless of the adoption of the AI. This will not be surprising, because the accelerated calculation allows data centers to complete the tasks faster, resulting in energy efficiency and higher performance.
Accelerated IT will not only reduce the operating costs of data centers, but this could also help maintain the increase in electricity consumption. Meanwhile there is Other opportunities of several billion dollars also for Nvidia, Like cloud games.
Add the fact that the global IA flea market should see an annual growth rate in the process of almost 35% to 2035, while it should generate an annual turnover of $ 847 billion, and it can Being concluded that Nvidia still has a lot of salk to grow, considering that it generated $ 96 billion in revenue during the 12 months.
All this indicates that the purchase of Nvidia can always prove to be a long -term intelligent decision, which is why investors should consider adding this technological action to their portfolios because it is negotiated to a profit of 33 times attractive Due to the formidable growth in the profits it is set to deliver.
2. Meta Platforms
The digital advertising market is massive, generating around $ 667 billion in income last year. Third -party estimates believe that the digital advertising market could generate more than $ 1.5 billion in revenues by 2030, and Meta Platforms is one of the best ways for investors to capitalize on this lucrative opportunity.
The social media giant is expected to generate $ 163 billion in revenues for 2024, an increase of 21% compared to the same period last year. Based on estimated income of $ 667 billion generated by the digital advertising market last year, Meta Platforms would have checked just over 24% of this space in 2024. Assuming that the company retains this part until At the end of the decade, it could attend a healthy increase in income over the next six years.
However, the right thing is that Meta is faster growth than the digital advertising market. Last year, for example, the digital advertising market increased by 11% compared to 2023 levels of $ 602 billion. The fact that Meta increases at a faster pace than the market it serves means that it earns more from. Again, this is not surprising, because the huge base of company users and the integration of AI tools for advertisers help it attract a larger share of digital advertising budgets.
There were 3.29 billion active people per day in the family of META applications in September 2024. More importantly, advertisers and brands may target this huge audience using advertising solutions fueled by AI de Meta which would have led higher yields on the advertising dollars spent. Unsurprisingly, advertisers are ready to pay more money to advertise Meta’s applications.
The average price per advertisement of the company increased by 11% from one year to the other in the third quarter of 2024. All this indicates that Meta is well placed to take advantage of the opportunity of 1.5 billion of dollars on The digital advertising market, which is why this action could prove to be a great investment.
Even better, investors can buy meta platforms at 29 times the profits at the moment, which is quite attractive since it should offer growth of 52% for $ 22.66 per share. The right part is that Meta seems to be able to maintain long-term solid levels of growth depending on the discussion above, and this could lead the market to reward it with more increase.
Randi Zuckerberg, former Director of Development of the Facebook and Sister of the CEO of Meta Platforms, Mark Zuckerberg, is a member of the board of directors of Motley Fool’s. Hack Has no position in the actions mentioned. The Motley Fool has positions and recommends Meta Platforms and Nvidia. The Word’s madman has a Disclosure policy.