With lifespans increasing and costs of living rising, investing wisely for retirement has become more crucial than ever. Though past performance is no guarantee of future returns, historically the stock market has delivered solid long-term growth. The S&P 500, for instance, has provided an average annual return around 9% over decades, factoring in dividends.
This is why stocks can serve as powerful vehicles for growing wealth over time through compounding gains. With a long enough timeframe and consistent investing, even modest yearly returns can snowball into a sizable nest egg. For those seeking tech stocks primed for market-beating performance in the decades ahead, here are three top contenders to consider.
1. MercadoLibre: The E-Commerce Giant of Latin America
Based in Argentina, MercadoLibre (MELI) has emerged as the leading e-commerce platform across Latin America. Since going public on the NASDAQ in 2007, the company’s stock price has skyrocketed over 4,400% and produced tremendous value for early investors. MercadoLibre operates online marketplaces in 18 countries and serves over 140 million users.
What sets MercadoLibre apart from other e-commerce providers is its relentless focus on understanding Latin American consumers and delivering tailored solutions to meet their needs. The company operates across the region’s diverse regulatory and financial landscapes, allowing it to tap into underserved markets with huge upside potential. As internet and smartphone adoption increases across Latin America, MercadoLibre is poised to benefit immensely given its first-mover advantage and grasp of local nuances.
The company has also branched successfully into additional services beyond e-commerce, including digital payments through its Mercado Pago platform and shipping logistics. These segments further strengthen MercadoLibre’s ecosystem and deepen user engagement. During Q2 2022, total payment volume on Mercado Pago surged over 80% year-over-year to $25.3 billion.
Unlike many high-growth internet firms, MercadoLibre has also demonstrated its ability to deliver profits efficiently. In Q2, operating income reached $217 million, representing a 16% margin. As the company continues gaining scale, analysts expect profitability to improve further. With Latin America’s e-commerce market still in its infancy at just 6% penetration, compared to over 20% in China, MercadoLibre has an enormous runway for expansion in the years ahead. Its leadership status, loyal customer base, and operational excellence make it a top tech stock to potentially generate wealth through retirement.
2. The Trade Desk: Riding the Connected TV Wave
Another digital disruptor that has handed investors mammoth returns is The Trade Desk (TTD), a pioneer in programmatic advertising. Since going public in 2016, The Trade Desk’s stock price has multiplied over 25x. The company operates a leading demand-side platform that empowers ad buyers to purchase digital ads across formats and devices. It provides cutting-edge tools to manage and optimize campaigns utilizing customer data.
The Trade Desk arrived on the scene just as digital advertising began supplanting traditional channels like print and TV. Programmatic ad spending has ballooned from around $10 billion in 2011 to over $150 billion in 2021, estimates eMarketer. The Trade Desk has emerged as a key intermediary facilitating automated ad transactions across this burgeoning ecosystem.
While the company serves advertisers globally, much of its recent success has come from capitalizing on Connected TV and streaming video. Ad-supported OTT video services like Roku and Hulu are gaining popularity as cord-cutting accelerates. eMarketer expects spending on CTV ads to reach $21 billion by 2023 in the U.S. alone. With its specialty in data-driven programmatic buying, The Trade Desk is uniquely positioned to benefit as advertisers shift budgets to CTV.
The company is also spearheading an alternative to third-party cookies called Unified ID 2.0, aimed at improving ad targeting and measurement in a privacy-conscious environment. Early adoption among advertisers has been robust, with leaders like Procter & Gamble, Disney, and Toyota already onboard.
For full-year 2022, The Trade Desk expects revenue to rise at least 30% above 2021’s total of $1.2 billion. Profitability also remains strong, with adjusted EBITDA projected between $490 million and $500 million. As digital media consumption explodes globally, this talented disruptor still has open field to gain market share for years ahead.
3. ServiceNow: Seamless Cloud Software Powering the Future of Work
Ever since its IPO a decade ago, ServiceNow (NOW) has been a gift that keeps on giving for shareholders. Over that stretch, the stock price has multiplied more than 14x. The company provides cloud-based digital workflow solutions for managing enterprise operations. Its software helps streamline IT services, customer service, human resources, and other critical workflows.
ServiceNow’s platform is enterprise-grade yet simple enough for any employee to leverage. It seamlessly connects departments across organizations while delivering consumer-like experiences. According to IDC, ServiceNow boasts a commanding 24% share of the worldwide IT service management software market. It counts over 80% of the Fortune 500 among its customer base.
While many software firms have stumbled recently, ServiceNow continues exhibiting strong growth and profitability. In Q2 2022, subscription revenues increased nearly 24% year-over-year to $1.7 billion. Operating margin landed at 25%. The company now serves 1,724 customers that each spend over $1 million in annual contract value, demonstrating its traction with large enterprises.
Looking ahead, ServiceNow expects to benefit enormously from advancements in artificial intelligence. The company is integrating new capabilities like natural language processing and predictive analytics across its offerings. It also unveiled a new solution called Creator Workflows that allows anyone to build apps on ServiceNow with simple text prompts.
As businesses undergo digital transformation and demand intuitive cloud platforms, ServiceNow stands ready to seize the opportunity. Analysts expect revenues to eclipse $20 billion by 2026, implying annual growth above 20% on average. With shares still trading 30% off their highs, now appears an opportune time to invest in this story of digital disruption.
4. Salesforce: Cloud Software Titan Ushering in the Era of Digital Transformation
Since its founding in 1999, Salesforce (CRM) has become one of enterprise software’s greatest success stories. The company pioneered the shift to cloud-based customer relationship management (CRM) solutions and hasn’t looked back since. Salesforce’s stock price has surged over 6,000% from its IPO through today, creating tremendous wealth for long-term shareholders.
With brands across industries accelerating their digital transformation initiatives, Salesforce finds itself at the forefront of this seismic shift. The company’s customer base now includes over 150,000 organizations worldwide. Salesforce offers a customizable CRM platform plus a growing suite of sales, marketing, e-commerce, analytics, and artificial intelligence capabilities.
During Q2 2023, Salesforce’s revenues rose 22% year-over-year to $7.7 billion. The company expects full-year sales growth of 17% to 20%. While many software firms are reining in hiring, Salesforce plans to continue investing aggressively in top talent to extend its edge. It currently boasts over 4,000 data scientists and engineers working on AI research.
With CRM software spend estimated to reach $160 billion by 2027, Salesforce still has open field to gain market share in the years ahead. Its recent $27.7 billion acquisition of collaborative messaging platform Slack also expands its addressable market significantly. For investors seeking a software leader at the center of digital transformation, Salesforce remains a top choice.
5. NVIDIA: AI Computing Powerhouse Poised for Immense Growth
NVIDIA (NVDA) has propelled itself to the forefront of multiple technology megatrends, from video gaming to data centers to autonomous vehicles. Since listing publicly in 1999, the company’s share price has multiplied over 5,500x, turning early stakeholders into millionaires many times over. Though NVIDIA stock has declined nearly 50% from highs amid the tech downturn, the long-term growth thesis remains compelling.
NVIDIA’s graphics processing units (GPUs) have come to dominate computing workloads like artificial intelligence, machine learning, and high-performance computing. As AI adoption soars, demand for NVIDIA hardware and software should follow suit. In Q2 2023, the company’s data center segment grew revenue 61% year-over-year to $3.8 billion.
Major technology players like Amazon Web Services, Microsoft Azure, Alphabet, and Meta are deploying NVIDIA chips to enhance AI capabilities in the cloud. NVIDIA also stands at the forefront of the autonomous vehicle revolution, powering automated driver assistance platforms.
While NVIDIA faces supply chain disruptions that will limit near-term upside, its long-run prospects appear highly promising. Annual revenues could approach $100 billion by the end of the decade, estimates BofA Securities analyst Vivek Arya. With AI poised to reshape nearly every industry, NVIDIA remains a core enabler well-positioned to churn out market-beating returns over the long haul.