3 Stocks That Have Turned $25,000 Into More Than $1 Million in 15 Years
The Great Recession ended nearly 15 years ago. Buying stocks toward the end of an economic slowdown can lead to some oversize returns down the road since that usually means you're buying them at reduced prices, when optimism in the markets could still be a bit muted.
If you invested $25,000 at the end of the Great Recession in any of the stocks on this list, your investment would now be worth more than $1 million. Nvidia (NASDAQ: NVDA), Netflix (NASDAQ: NFLX), and Regeneron Pharmaceuticals (NASDAQ: REGN) have been among the best and brightest stocks over the past 15 years.
Here's how much a $25,000 investment in these stocks would have grown over that time, and why they still might be good buys.
Nvidia: $8.2 million
Nvidia generated some incredible life-changing returns in 15 years, turning a $25,000 investment into a mammoth $8.2 million today. In the past year and a half, the stock has gone parabolic due to the excitement surrounding artificial intelligence (AI) and the need for its chips to help develop chatbots and next-gen technologies.
But what's notable is that even before the recent surge in its share price, Nvidia still would have been a millionaire-making investment. If you invested $25,000 in the stock in June 2009 and held on until at least 2022, you still would be sitting on more than $2.6 million.
The company's chips have effectively become the standard in computing, and while AI has certainly ramped up Nvidia's growth, it was a top growth stock even before then. In the past 10 years, the only thing more impressive than the top-line growth has been that its bottom line has accelerated even faster:
NVDA revenue (annual) data by YCharts.
Nvidia can still make for a good buy even though its market cap is already around $2.3 trillion. Given the opportunities in AI and the important role Nvidia plays in its growth, it might not be too late to invest in this tech giant.
Netflix: $2.6 million
In 2009, Netflix was still largely a DVD rental company. The big news by the end of that year was that nearly half of its subscribers were watching online streaming.
Today, that's the main reason people subscribe to Netflix: to watch online, either from a computer or a mobile device. Investing in Netflix in 2009 would have involved some risk because the company was by no means a sure thing, nor were its financials as strong as they are today.
Nowadays, Netflix has become the example of how to create a profitable streaming business. While consumers might not be thrilled with its rate increases and crackdown on password sharing, those moves allowed the company to create a sustainable and profitable operation.
Last year, Netflix reported net income of $5.4 billion on revenue of $33.7 billion, for a profit margin of 16%. Many other streaming businesses, meanwhile, still struggle with generating any profit at all.
It is still a leader in the streaming industry with just under 270 million paid subscribers. Although its future returns could be more modest, this can still be a good growth stock to buy and hold.
Regeneron Pharmaceuticals: $1.4 million
Regeneron Pharmaceuticals has also been a top growth stock to own over the past 15 years. A $25,000 investment back then would be worth a little under $1.4 million today.
As with Netflix, Regeneron was a far riskier stock in 2009. It was unprofitable and was highly dependent on collaboration revenue. At $314 million, that accounted for 83% of Regeneron's top line.
Today, the business is broader and its revenue in just the first three months of this year ($3.1 billion) easily eclipses its 2009 tally. While collaboration revenue still represents a sizable portion of Regeneron's business, the percentage is down to just 40% as the company's eye disease medication Eylea is a highly successful blockbuster drug, with $1.4 billion in revenue just this past quarter.
The company still has more than 35 product candidates in development, so there might still be a lot more growth on the horizon. And with the company generating strong free cash flow of nearly $4 billion in the trailing 12 months, Regeneron is in a great position to continue investing in growing its operations. This is a stock that still has the potential to generate strong returns.
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David Jagielski has no position in any of the stocks mentioned. The Motley Fool has positions in and recommends Netflix and Nvidia. The Motley Fool has a disclosure policy.
