Retirement dreams of a million-dollar nest egg don’t have to remain just dreams. According to a CNBC study, a mere 16% of retirees achieve that coveted financial milestone. One way to get there? Dive into the tumultuous waters of the stock market. You could go safe with index funds like the S&P 500, a strategy that provides steady, market-matching returns over time.
But if you dare to dance with the devil and aim for potentially higher returns, individual stocks might be your muse. Yet, this route ripples with the risk of trailing market averages, perchance even financial loss. Should you choose this path, gaze upon three tech stocks below that carry the weight of potential, standing as pillars for your ascension to millionaire status by the retirement horizon a decade hence.
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ASML: Leading with Technological Dominance
ASML, holding a broad economic moat within the tech domain, crafts lithography equipment vital for semiconductor production. The crown jewel in their arsenal? Extreme ultraviolet (EUV) lithography systems, crucial for generating today’s cutting-edge microchips.
Years of relentless R&D and strategic investments have birthed a technological chasm that peers struggle to bridge. With the clamor for AI-powered advanced chips surging, ASML’s market dominance foretells a profitable era ahead.
The company already boasts a $332 billion market cap. Should it scale by 300% over the next decade, envisioning a market cap of $1.33 trillion isn’t far-fetched. With only seven current trillion-dollar entities, ASML’s trajectory towards that elite cohort appears plausible amidst the semiconductor sector’s manufacturing crescendo.
Moreover, ASML doesn’t just shine in profits; it sprinkles dividends, albeit modest at 0.8% yield. Reinvesting such payouts could nudge investors closer to their financial finish line.
Arm Holdings: Harnessing the Power of Efficiency
Arm Holdings, another enchanting tech protagonist, rides the AI wave with finesse. Unlike its chip design brethren, Arm crafts no chips of its own. Instead, it licenses superior technology to stalwarts like Apple and Nvidia, presenting power-efficient architectures coveted in smartphones and data centers. This efficiency jewel is a compelling force amidst competing power-hungry designs.
Touting vast operating margins courtesy of unique technology and a licensing model, Arm’s outlook gleams as it unveils fresh products amid the AI boom. Arguments stand firm for a 15% profit growth trajectory, cementing its status as a growth champion.
The digital advertising crusade marches forth as brands pivot marketing budgets to digital avenues in the quest to unearth new customer engagement horizons. A torchbearer in this realm? The Trade Desk, reigning supreme as the premier independent demand-side advertising technology platform.
Eclipsing both its ad tech kin and broader market cohorts, The Trade Desk stands poised to ride the digital ad ascension ride with the aid of its AI marvel, Kokai. This innovative platform streamlines campaign tracking and performance gauging, ushering advertisers into a realm of precise, customer-responsive decision-making.
History sings The Trade Desk’s tale of growth resilience even in austere climes, promising momentum as platforms and media channels morph in the coming decade. Basing projections on past crescendos, envisioning a quadruple earnings per share uptick within the decadal clock ticks appears tangible.
Should you invest $1,000 in ASML right now?
Prior to embarking on an ASML stock quest, ponder this:
The Motley Fool Stock Advisor experts have unfurled a treasure trove of the ten best stocks ready to dazzle investors’ portfolios. ASML didn’t make the exclusive cut, casting a spotlight on other potential megastars whose returns might eclipse market behemoths in the approaching years.
Recall when Nvidia graced such a list on April 15, 2005? A $1,000 foray then would have burgeoned to a staggering $826,069!* A blueprint for prosperity awaits with Stock Advisor, proffering a roadmap to riches with bimonthly stock counsel that has outperformed the S&P 500 by a magnifying glass since 2002.
*Stock Advisor returns as of October 7, 2024
Jeremy Bowman has positions in 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: short November 2024 $24 calls on Intel. The Motley Fool has a disclosure policy.