3 Stocks That Turned $1,000 Into Half a Million Dollars

3 Stocks That Turned $1,000 Into Half a Million Dollars

Here are three of the stock market’s greatest success stories, and what you can learn from them.

Here are three very different businesses that have turned $1,000 into $500,000 for investors. The stock market has produced some fantastic returns for long-term investors over the years, but a select few companies have produced life-changing wealth for their shareholders. In fact, some have taken a $1,000 investment and turned it into $500,000 over time.

Here are three examples of stocks that have done just that, and what you can learn from them as you try to discover the next 500x investment opportunities. The classic example of a massive winner

From the time Warren Buffett took the reins of a struggling textile manufacturer called Berkshire Hathaway ( BRK.A -0.26%) ( BRK.B -0.39%) in 1964 through the end of 2021, shares gained a staggering $3,641,613%. To put this into perspective, this means that investors who put $1,000 into the stock in 1964 have seen their investment grow to more than $36.4 million. Buffett and his team accomplished this by pivoting their focus to insurance businesses, and using the “float,” or premiums not yet paid out for claims, to invest in stocks and entire businesses.

Berkshire is also a great example of a company that disproves the “I’m too late” excuse for not investing in an already-successful business. In fact, an investor could have bought shares of Berkshire as late as 1983 — 19 years after Buffett took over — and still turned a $1,000 investment into $500,000. This company has truly changed the world

It’s difficult to think of any company that has changed day-to-day life in the United States more in the past 25 years than Amazon ( AMZN -1.10%). Since its days as an online bookstore, Amazon has grown into the largest retailer in the nation, generating more than $600 billion in merchandise sales last year. As if that wasn’t impressive enough, it has also built Amazon Web Services (AWS) into the dominant leader in cloud services.

Not surprisingly, investors who got in during Amazon’s bookstore days have been handsomely rewarded. In fact, a $1,000 investment at the time of Amazon’s 1997 initial public offering (IPO) would be worth about $1.3 million today. An under-the-radar winner

NVR ( NVR -1.30%) is perhaps the biggest surprise on this list, because the homebuilder isn’t well known by many U.S. investors (it is better know for its main brand, Ryan Homes). Plus, you might not exactly think of homebuilding as an industry with 500x potential.

To be fair, after the recent market pullback, NVR isn’t quite at the 500x level since its 1993 IPO, but it got there in 2021 and would have still turned a $1,000 investment into about $400,000. But this is still a stellar accomplishment for a stock in a slow-and-steady industry.

NVR achieved its sector-leading returns with two main differentiating factors. First, it uses a land-light model, in which it doesn’t buy any land until it is ready to build a house for a customer. This means that the company can build the same volume of homes with far less cash up front than its peers would require.

Second, NVR’s management has done a fantastic job of strategically allocating capital, especially when it comes to opportunistically repurchasing shares. In fact, its outstanding share count has declined by more than 80% since its IPO. 3 key points for investors

As you can see, these are three very different businesses. And they aren’t the only three companies to achieve such impressive returns, but just three examples of what the long-term power of great management and excellent market opportunities can do.

To wrap things up, here are three big takeaways that investors who hope to find the next 500x winners should keep in mind as they go through their investing journeys: Even the biggest winners look like losers from time to time. None of these three stocks have gone straight up over the years, or anywhere close to it. Amazon lost 95% of its value from its previous high when the dot-com bubble burst. NVR’s stock price declined by more than 70% when the financial crisis created tremendous uncertainty for homebuilders. And even Berkshire Hathaway, which is often thought of as one of the most stable companies in the world, has seen its stock price draw down by more than 50% several times during Buffett’s tenure.

Not just tech companies produce massive returns. Sure, there are a lot of tech stocks I could have included on this list. Microsoft ( […]

source 3 Stocks That Turned $1,000 Into Half a Million Dollars

Leave a Reply