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Amazon’s steady growth is likely to provide strong long-term returns for investors.
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Alphabet, known for its innovation and currently favorable reputation, may also be worth a look.
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Building a retirement portfolio of $1 million is achievable with consistent, reasonable contributions over the years. For instance, if your portfolio starts at $50,000 and you add $200 monthly, it could surpass $1 million in 30 years, assuming average market return rates—something that’s quite realistic.
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If your savings are nonexistent, perhaps now is the perfect time to consider opening an investment account. The best moment to start was yesterday; the second best is right now.
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So, which stocks should be in your portfolio? To secure solid, long-term gains, setting your sights on tech giants at competitive prices is essential. That’s why stocks like Amazon and Alphabet can significantly boost your portfolio’s value by retirement.
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Amazon has exhibited remarkable growth, particularly within its e-commerce and cloud computing sectors. The company leads in U.S. e-commerce and is a major player in global cloud services through Amazon Web Services (AWS).
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There’s still plenty of market share for e-commerce to capture from traditional retail. As of the first quarter of 2025, e-commerce comprised about 16.2% of total U.S. retail sales. Even with Amazon’s dominance, online shopping still has a long way to go. Fresh groceries, for example, in particular are a challenge, but Amazon and others are striving to expand these offerings.
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In the last quarter, Amazon’s retail sales in North America grew by 8% year-over-year, and international sales also saw a similar increase, benefiting from fluctuating foreign currencies. It seems likely these revenues could continue on a similar growth path for years to come.
The AWS segment is seeing even more rapid growth, with an impressive 17% increase recently, largely because of rising demand for AI infrastructure. This division alone exceeded $100 billion in revenue. Analysts expect the cloud computing market to grow at about 15% annually through 2035, creating a favorable environment for this business.
Currently, Amazon has a market cap around $2.2 trillion, with $72 billion in operating profit recorded over the past year. Thanks to ongoing growth in both e-commerce and cloud computing, Amazon appears positioned for strong returns in the long run.
On the other hand, Alphabet is facing scrutiny from investors, especially with rising competition. Despite owning prominent services like Google Search and YouTube, Alphabet’s stock price growth has lagged. The company is now trading at a P/E ratio of 20, significantly lower than its competitors. AI companies like OpenAI are garnering attention and market share, posing potential challenges for Alphabet.
Interestingly, Alphabet’s financials haven’t yet shown significant impacts from these competitive pressures. Google Search revenue climbed to $50.7 billion last quarter, aiding an overall revenue increase of 14% year-over-year, adjusting for currency fluctuations. While OpenAI’s ChatGPT competes with Google’s offerings, Alphabet is fighting back with robust AI features and advancements.
Moreover, Google Cloud is making substantial long-term investments to enhance its AI capacities. Interestingly, OpenAI has even partnered with Google Cloud for its computing needs. Also, YouTube is growing its share of video views in the U.S., and Waymo is expanding its robotic taxi services nationwide, beginning to shake up the ride-sharing market.
Even though Alphabet faces hurdles with AI competition, there are numerous revenue growth avenues available, particularly in the cloud computing sector, which recently closed in on $50 billion in annual revenue—a 28% increase year-over-year. Investors might anticipate this division surpassing $100 billion in annual revenue in about five years, contributing significantly to Alphabet’s earnings.
With its affordable P/E ratio and a solid history of growth and profitability, Alphabet could represent a worthwhile long-term investment.
It might be wise to think about whether you should include Amazon in your stock purchases, though.
The analyst team at Motley Fool Stock Advisor has listed other stocks they consider more favorable than Amazon right now. These selected stocks may offer exceptional returns in the future.
Consider historical performance, like if you had invested $1,000 in Netflix or NVIDIA when first recommended, your investments would now be worth impressive amounts. These returns showcase the strong potential of selected stocks.
It’s essential to keep an eye on opportunities like these, especially as Stock Advisor has substantially outperformed the S&P 500.
