Investing in High-Growth Stocks
One effective strategy for making money in the stock market is to buy and hold high-growth companies for the long haul. Growth stocks typically represent companies that can expand their earnings at a rate faster than the broader market, which usually results in a healthy increase in share prices.
Let’s take a look at two promising growth stocks—Applied Digital and Western Digital. You can invest with as little as $500 (after taking care of your expenses and any high-interest debts). It’s worth considering putting that money into either one or both of these stocks for potential long-term gains.
Applied Digital: Meeting the Demand for AI Data Centers
The need for dedicated artificial intelligence (AI) data centers is on the rise, as tech firms seek the computing power necessary for cloud-based AI workloads.
Applied Digital is well-positioned in this market, specializing in designing, constructing, and operating AI data centers for major tech players. It’s no surprise that the company has seen substantial revenue growth.
In the third quarter of fiscal 2026 (ending February 28), revenue reached $126.6 million, marking a remarkable 139% increase from the same time last year. This growth is expected to accelerate as more data center facilities come online. Applied Digital has already lined up a $16 billion pipeline in contract revenue.
The company is currently developing 400 megawatts (MW) of capacity for CoreWeave and an additional 200 MW for another customer. They’ve recently finished a 100 MW facility for CoreWeave, leading to immediate lease income. Once the total 500 MW for these two clients is operational, Applied Digital’s growth trajectory should continue to rise.
On top of that, they are expanding their operations by initiating a new data center campus in the southern U.S. This facility is expected to handle up to 300 MW of AI workloads, with initial operations set to start in mid-2027. Analysts are optimistic about Applied Digital’s sales growth moving forward.
The outlook is favorable, as all 13 analysts covering Applied Digital rate it as a Buy, with a median 12-month price target of $43—implying a potential 37% upside from current prices. Given the robust revenue pipeline and ongoing projects, the stock presents an appealing opportunity, particularly for growth-minded investors.
Western Digital: Capitalizing on Storage Demand
On the other hand, Western Digital has seen its shares soar by 123% in 2026 so far. This remarkable surge has been fueled by a sharp rise in sales and profits, driven by strong supply and demand dynamics.
The company’s hard disk drives (HDDs) are increasingly in demand for use in AI data centers, which rely on these drives to manage the massive volumes of data that AI workloads generate. According to IDC, global data generation is expected to triple between 2024 and 2029.
The surging demand for HDDs has led to a significant shortage, with Western Digital already sold out of its HDD capacity for 2026. Customers are also locking in contracts for supply into 2027 and 2028, suggesting that this shortage may persist.
Given this situation, prices in the HDD market are likely to continue rising as demand outpaces supply. This trend bodes well for Western Digital’s earnings, which are expected to increase significantly from the previous year’s $4.93 per share.
Looking ahead, analysts estimate that if Western Digital’s earnings reach about $19.09 per share in a few years and it trades at a price-to-earnings ratio of approximately 32, its stock price could potentially climb to $611—indicating a 57% upside. Investors may want to consider adding this tech stock to their portfolios before prices rise further.
