From Nasdaq: 2024-05-18 07:22:00

Investors are eyeing two top stocks from the “Magnificent Seven” – Amazon (NASDAQ: AMZN) and Alphabet (NASDAQ: GOOGL) for their growth potential. Amazon’s strong quarter results show tripled operating income, driven by AWS and ad revenue. Meanwhile, Alphabet boasts high profitability and net margins, with Google Search and cloud services leading the charge. Both companies have room for growth despite their all-time highs.

While Amazon dominates e-commerce and cloud services, Alphabet’s Google owns major platforms like YouTube and Gmail. With Google Cloud as a competitor to AWS, Alphabet’s advertising business has room for optimization. Alphabet boasts a 26% net margin and strong financials, providing ample room for capitalizing on opportunities and returning capital to shareholders.

Despite high valuations, Amazon and Alphabet remain strong contenders for long-term investment. While Alphabet trades at 30 times forward earnings and Amazon with a higher P/E, both companies show potential for future growth. With a market cap exceeding $4 trillion combined, these proven winners are poised to deliver market-beating returns for years to come.

Stock Advisor recommends 10 best stocks for investors, excluding Amazon. The service has outperformed the S&P 500 since 2002, offering insights for building a successful portfolio with regular updates and stock picks. Past success stories like Nvidia’s historic returns show the potential for significant gains through strategic investments.

Disclosure: Suzanne Frey of Alphabet and John Mackey of Amazon are associated with The Motley Fool’s board of directors. Author Matt Frankel holds positions in Amazon. The Motley Fool recommends and holds positions in Alphabet and Amazon. The views expressed are the author’s own and not of Nasdaq, Inc.



Read more at Nasdaq: 2 “Magnificent Seven” Stocks at All-Time Highs I’d Buy Right Now