Investments of $5,000 in these three growth stocks twenty years ago have ballooned into over $1 million each today.
Over the past two decades, Nvidia, Netflix, and Booking Holdings have transformed into powerhouses in their respective industries. These companies have demonstrated remarkable growth, driven by a combination of technological advancements, strategic acquisitions, and adaptability.
Nvidia, a leading player in the graphics processing unit (GPU) market, has experienced phenomenal growth, particularly since 2020. Its stock has surged significantly, with returns of over 2,690%. The company's focus on AI, machine learning, and data center technologies has positioned it as a leader in these fields. Nvidia has expanded its market reach by venturing into gaming, professional visualization, and the automotive sector. Strategic acquisitions, such as Mellanox, have bolstered its capabilities in high-performance computing.
Netflix, a pioneer in streaming services, has revolutionized traditional television viewing habits. The company has expanded globally and diversified its content offerings. Its stock has grown significantly over the past two decades, albeit with notable fluctuations in recent years. Netflix's success can be attributed to its innovative business model, producing high-quality original content, and adapting to changing consumer preferences. The company has adapted by offering ad-supported options and increasing subscription prices effectively.
Booking Holdings, formerly known as the Priceline Group, is a major player in online travel booking. Its stock has appreciated significantly, driven by strategic acquisitions and a strong online presence. The company's global expansion and brand diversification have been key to its growth. Booking Holdings operates multiple brands, including Booking.com, Priceline, Agoda, and Kayak, catering to diverse travel needs.
In the past 20 years, investing $5,000 in Netflix and Booking Holdings would now be worth over $3 million and $1.1 million respectively. Nvidia, on the other hand, has been a significant growth stock due to its involvement in AI technology. Its chips are critical in the development of AI technologies, including chatbots. Investing $5,000 in Nvidia 20 years ago and holding onto it until today would result in an investment worth over $3.1 million.
Netflix has continually expanded its business model over the years, transitioning from mailing DVDs to customers to offering streaming, and now delving into live TV, sports, and gaming. Booking Holdings is a leader in online travel sites and services, operating popular websites like kayak.com, priceline.com, and booking.com.
Despite trading at all-time highs, both Netflix and Booking Holdings can still make for good long-term investments due to their continued expansion. Booking Holdings trades at 33 times its trailing earnings, suggesting it may not be overly expensive given its growth potential. The company has significant margins and can be an excellent way to invest in the travel industry. Netflix, with a net margin of over 23%, has been a highly profitable business.
In 2021, Booking Holdings generated $23.7 billion in sales, an increase of more than 11% from the previous year. Nvidia, in the trailing 12 months, generated a profit of $77 billion, a significant increase from a few years ago when it wasn't bringing in that much in revenue. Despite this, Netflix and Booking Holdings continue to find ways to expand, ensuring their growth trajectory remains strong.
- The surge in Nvidia's stock, with returns of over 2,690%, is a testament to its success in the finance realm, particularly investing in AI, machine learning, and data center technologies.
- Over the past two decades, investing in Netflix has proven to be a profitable venture, with $5,000 turned into over $3 million through strategic diversification and adaptability in content offerings and business models.
- Booking Holdings' stock has appreciated significantly over the past two decades and, despite trading at all-time highs, its growth potential justifies the 33 times trailing earnings ratio, making it an attractive long-term investment in the finance sector, especially the travel industry.
