Growth reserves usually seem overrated, but there are still some diamonds in the rough.
Amazon is ready to grow continuously over the next decade.
ASML is a large beneficiary of the growth growth for semiconductors.
Finding stocks of growth technology at a reasonable price in today’s market is not easy. Despite some major ups and falls in 2020, 2022 and now 2025, technological stocks generally fell apart after the great recession of 2008-09, which makes investors wealth in the process. Today, many of these shares are trading at expensive levels.
However, not every stock. Two technological giants – Amazon(Nasdaq: AMZN) and ASML(Nasdaq: ASML) – Look at reasonable prices in today’s market and are primed to grow over the next decade and then, driven by the same tail: artificial intelligence (AI). Therefore, these two shares can create lifelong investors if you hold the long way.
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Many know Amazon about the electronic trade market, a segment that still puts on solid growth and finally bends its muscles to profitability. However, the greater part of Amazon’s profit comes from cloud calculations. Amazon Web Services (AWS) reached a record $ 117 billion annual revenue in the first quarter, increasing by 17% compared to the year, and a record margin increased 40% during the period. For a period of 12 months, this profit margin would be equal to $ 46 billion and $ 47 billion in operational income for Amazon alone since its AWS division.
According to the AWS management, it is still limited to capacity when trying to introduce data centers for its AI clients, such as anthropica. This is a great news about the division and shows that the long runway for growth cloud calculations is available when combined with the boom AI in the cost of data centers. If Amazon can maintain this impressive AWS profit margin, the division can be about to generate $ 100 billion in operational income within the next five to 10 years.
Let’s not forget e -commerce. Net sales in their North American retail department jumped 8% in the quarter (without foreign currency transfers), with growing profit margins. Amazon may encounter some winds if these tariffs stick to, but it is well equipped to cross the other side and navigate the supply chain. Much of his profits come from revenue from advertising for products lists that increased by 18% compared to a year to $ 13.9 billion in the quarter, with high profit margins.
Today, Amazon shares are traded in the price-profile ratio (P/E) of 34, which may seem high for some investors seeking value in today’s market. However, investors need to understand that Amazon’s profits will grow at a rapid pace over the next decade, which will reduce this ratio P/E. Also, the average P/E ratio of Amazon over the last 10 years is closer to 55. Now is a great time to buy Amazon shares and continue persistence.
Ycharts data.
ASML is a leader in the production of high -tech lithographic equipment used by semiconductor manufacturers. Other companies around the world have failed to repeat the company’s modern systems, even in China, where state -funded research capacity provides a capital advantage. Without these sophisticated lithographic machines, you cannot make avant -garde computer chips such as those designed by Nvidia to power the AI revolution.
The company does not grow rapidly, but it has a durable growth track in front of it, as it is built more seashellic production capacity for advanced chips around the world. For example, the total cost of $ 165 billion Production of semiconductors in Taiwan is committed to invest in its US -based facilities. Some of these costs will be on Lithographic machines from ASML, which sells for hundreds of millions of dollars each.
ASML revenue has fallen in the last quarter, but it has led to steady growth in the last decade, increasing by 351% of 351% in this period. By 2030, he expects to generate revenue from 44 billion to 60 billion euros ($ 50 billion to $ 68 billion in current exchange rates). The 12 -month revenue was $ 33 billion.
Like Amazon, ASML does not have a cheap P/E ratio, currently sits at 29. However, like Amazon, its current PE is well below the average for 10 years, and ASML has a long track to continue its sold units due to the explosion of AI data centers and computer chips. This should support ASML’s profits to collide higher in 2030, bringing the price of the shares with it.
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John Maki, former CEO of Whole Foods Market, a subsidiary of Amazon, is a member of the Board of Directors of Motley Fool. Brett Shafer has positions in the Amazon. Motley Fool has positions B and recommends ASML, Amazon, Nvidia and Taiwan Semiconductor Manufacturing. Motley Fool has a policy of disclosure.
2 technological shares that could help you set up for life, originally published by Motley Fool
