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Most Likely to Produce 10X Returns: Facebook vs. Amazon | The Motley Fool

Could these massive companies actually grow to 10 times their current size?

Matthew Frankel, CFP

It might seem far-fetched to think that a tech company with a trillion-dollar (or close to it) valuation could produce 10 times their returns for investors from here. But that’s exactly what some of our experts think Facebook (NASDAQ:FB) and Amazon (NASDAQ:AMZN) are capable of doing. 

In this Fool Live video clip, recorded on April 8, Fool.com contributors Matt Frankel, CFP, and Jason Hall, along with chief growth officer Anand Chokkavelu, discuss why they think these companies could still have so much room to grow and which one they think has the best chance at a 10-times performance. 

Anand Chokkavelu: Usually, I’d say, most likely to 10X for just about any stock. These all have market caps somewhere between just south of $1 trillion to Apple‘s $2 trillion. Maybe 10X in 10 years, maybe that’s stretching a bit. But let’s say 5X to 10X. Again, we’ve been wrong in the past about growth prospects. The kind of the story of the last decade is how amazingly these large-caps tech stocks have grown, defying gravity. Jason, which one would you pick for most likely to 10X.

Jason Hall: Before we do that, I’m going to do a screen share and we’ve got the poll open for folks to do it. I’m just going to do a screen share and show them how to do it. I’m going to pick my first one from the screen share.

Here we are. I’m logged into the Slido, you see that guys? You see up here at the top, you’ve got Q and A, and then over here you have poll. Tim has already launched our polls, so most likely to 10X. Man this is hard here. This is hard. I’m going to say Facebook, there’s a caveat though. I’ll explain the caveat after you guys pick yours. You want me to rank all mine in order or just my first one?

Chokkavelu: No. Just one. Matt, it’s you.

Frankel: I say that one that’s most likely to 10X from here is probably Amazon. I think like Jason said, they are absolutely ruthless when they attack a new market. Remember, it was 10 years ago that we thought that Amazon was pretty much a bookstore. Right now, we think they are just a retailer. They could become just a healthcare company and just a giant conglomerate of their own 10 different industries eventually. I think that Amazon is the most likely to 10X.

Chokkavelu: I should’ve gone first because I’m Amazon as well. Just similar stuff, I mean between the retail and AWS and just how competitive they are, I mean, we’re going to talk about that probably. I’m probably going to be saying a lot of nice things about Amazon.

This article represents the opinion of the writer, who may disagree with the “official” recommendation position of a Motley Fool premium advisory service. We’re motley! Questioning an investing thesis — even one of our own — helps us all think critically about investing and make decisions that help us become smarter, happier, and richer.

Anand Chokkavelu, CFA owns shares of Amazon. Jason Hall owns shares of Amazon. Matthew Frankel, CFP owns shares of Apple and has the following options: short February 2021 $140.0 calls on Apple. The Motley Fool owns shares of and recommends Amazon, Apple, and Facebook. The Motley Fool recommends the following options: long January 2022 $1920.0 calls on Amazon, long March 2023 $120.0 calls on Apple, short January 2022 $1940.0 calls on Amazon, and short March 2023 $130.0 calls on Apple. The Motley Fool has a disclosure policy.

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