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3 Millionaire-Maker Cloud Computing Stocks to Buy And Hold Forever

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Investors are interested in growth which is why cloud computing stocks will continue to make sense for the long term. Grand View Research expects the cloud computing market to grow at an annual rate of 14.1% between 2023 and 2030. 

That growth far exceeds growth in the overall economy and will entice investment capital en masse. In short, investors can reasonably expect that a dollar invested in cloud computing stocks today will be worth much more in the future. 

To be honest, the best buy-and-hold forever cloud computing stocks are likely the three largest tech names. I’ve only included one below. Let’s explore it and two others that offer strong potential returns in the near future. 

MSFT Microsoft  $333.56
SNOW Snowflake  $173.39
DOCN Digital Ocean  $41.38

Microsoft (MSFT)

microsoft stock

Source: Peteri / Shutterstock.com

Microsoft (NASDAQ:MSFT) is a clear buy-and-hold stock for investors seeking long-term value and returns.

A lot has happened to the company over the past few years, most of which has accelerated what was already strong growth. 

The pandemic gave Microsoft a massive boost. It accelerated tech firms in a way that was massively beneficial. Lockdowns sped the evolution of tech at a pace that wouldn’t have been possible in the absence of a pandemic. Profits increased in turn and Microsoft boomed. 

More recently, AI again helped Microsoft get ahead again. Its OpenAI investment has already paid off. Share prices have surged in 2023 because of it. 

Microsoft is also a cloud computing giant. Microsoft’s intelligent cloud revenues reached $22.1 billion in the second quarter. That represented a 17% increase YoY and more than 40% of overall sales.

Azure and other cloud service revenue increased by 27% during the period. The overall thrust is that Microsoft is a cloud computing stock that is much more than cloud computing alone and is highly likely to continue growing even though it’s already massive.

Snowflake (SNOW)

Snowflake symbol and logo at the company corporate headquarters in Silicon Valley. SNOW stock.

Source: Sundry Photography / Shutterstock

Snowflake (NYSE:SNOW) provides a data cloud platform that allows users to access its data cloud consisting of multiple public clouds.

It wasn’t built using legacy big data technology like other clouds. Instead, it was designed for native use within the cloud. Firms simply sign up and access the data Snowflake houses without any hardware and very little software. 

Snowflake is very large and is growing at a phenomenal rate. Revenues grew by 48% during the most recent quarter on a year-over-year basis to $624 million. 

There aren’t any other cloud firms at that scale that offer growth at that rate. That’s the hook for Snowflake. It is a growth stock and it comes with attendant problems growth stocks have. Net losses eclipsed $226 million during the first quarter. They’re increasing, not shrinking.

Further, SNOW stock is particularly sensitive to interest rates. Share prices collapsed in 2022 but the long-term narrative still favors the company given its scale and growth. Any narrowing of losses will certainly send prices higher also.

Digital Ocean (DOCN)

A laptop screen displays the logo for DigitalOcean (DOCN).

Source: monticello / Shutterstock.com

Digital Ocean (NYSE:DOCN) is a sleeper stock in the cloud computing sector.

It doesn’t get anywhere near the attention that the big three cloud providers do. The reason is simple: The big three serve large enterprise customers while Digital Ocean serves their small and medium enterprise counterparts. 

Large enterprises account for a greater percentage of IT investment overall. That’s not a positive for Digital Ocean. Yet, small businesses make up most of the world’s economy.

They’re also lagging relative to large firms in terms of digital transformation. That’s where Digital Ocean’s opportunity lies. It has a tremendous opportunity in front if it. It can sell, sell, sell to SMEs and bring them into the digital age. 

A lot of investors believe in DOCN stock for precisely that reason which partially explains why it is oversold currently. Investors should wait for prices to fall some and pick up shares that are likely to grow for some tie to come. 

On the date of publication, Alex Sirois did not have (either directly or indirectly) any positions in the securities mentioned in this article. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.com Publishing Guidelines.

Alex Sirois is a freelance contributor to InvestorPlace whose personal stock investing style is focused on long-term, buy-and-hold, wealth-building stock picks. Having worked in several industries from e-commerce to translation to education and utilizing his MBA from George Washington University, he brings a diverse set of skills through which he filters his writing.

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The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

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