Investing $25,000 in these 2 stocks 15 years ago would have earned you nearly $11 million

A recession may seem like a bad time to invest in stocks. But if you’re willing to invest in growing businesses and stick with it for the long haul, it can pay off, significantly. Two excellent examples of this are Nvidia (NVDA -0.21%) and Super Micro Computer (SMCI -0.23%)also known as Supermicro.

If you had invested $25,000 in these stocks right after the Great Recession ended 15 years ago, you would be sitting on some life-changing returns right now.

Nvidia: $8.9 million

It’s no secret that chip maker Nvidia has been one of the best investments to own over the years. But what is truly astounding is the scale of these gains. If you invested $25,000 in stocks in July 2009, when the Great Recession had just ended, that investment would now be worth $8.9 million.

Most of the stock’s gains have come in recent years as interest in artificial intelligence (AI) has taken off. Nvidia has become synonymous with AI as its chips are heavily used in the development of AI models and software. Even with the recent drop in stock value, Nvidia would have made a phenomenal investment to hold for the long term.

Other tech companies are still trying to figure out AI and how to model and monetize new products. And while they’re doing that, in many cases they’re buying chips from Nvidia. And all this elation and enthusiasm in the field of artificial intelligence is visible just by looking at the rapidly growing financial situation of the company.

In its most recent fiscal year, which ended Jan. 28, the company’s revenue came in at just under $61 billion — more than triple the $16.7 billion it generated three years ago. years earlier. What’s even more impressive is its revenue growth, which went from $4.3 billion in that period to $29.8 billion last year.

The AI ​​revolution is still in its early stages, which is why investors remain bullish on the stock’s long-term outlook. It may not be too late to invest in Nvidia given its dominance in the AI ​​chip and data center market, but with a forward price-earnings multiple of over 40 and investors becoming increasingly wary of AI stocks with high prices lately, there could be some short-term volatility and investors will probably need some patience as it could take some time to get good returns from buying the stock today.

Supermicro: $2 million

Supermicro stock has also generated some huge returns for investors. A $25,000 investment in stocks in July 2009 would now be worth about $2 million. When combined with the $8.9 million you could have made from Nvidia with the same size investment, your portfolio would be worth nearly $11 million investing $25,000 in each of these two high-powered technological actions.

As with Nvidia, Supermicro’s valuation has caught fire due to AI over the past couple of years. The company is a major player in cloud and storage solutions. Its products are in high demand as companies expand and grow their online offerings. Companies need to build the infrastructure needed to host next-generation AI products, and Supermicro servers and storage solutions help companies achieve this.

In fiscal 2020 (its fiscal year ends in June), Supermicro’s revenue totaled $3.3 billion. Now, however, even she does quarterly income is higher than that. Business has been hot for Supermicro, and as companies continue to spend heavily on AI, the stock is sure to benefit from these developments.

The stock trades at a forward P/E of 17, which seems cheap for Supermicro given its impressive results. Despite its strong earnings, this can still make a solid buy-and-hold investment right now.