Got $500? 2 Top Growth Stocks to Buy That Could Double Your Money

Earning above-average returns in the stock market is not that difficult. The S&P 500's historical annualized return is about 10%. Investing in financially strong companies with superior prospects can help you achieve much better results. Some of the most prominent tech companies have a long record of delivering market-beating returns, and these stocks still offer solid value relative to their growth prospects.

If you have $500 you don't need for living expenses and can commit to a long-term investment strategy, here are two top growth stocks that can double your money by 2030.

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1. Alphabet (Google)

Google is one of the most valuable brands in the world. Its parent company, Alphabet (NASDAQ: GOOG) (NASDAQ: GOOGL), has delivered exceptional returns to investors over the last few decades, and it is well positioned to keep that winning streak going. It just recently hit $100 billion in quarterly revenue for the first time -- double its 2020 quarterly revenue.

Alphabet is one of the "Magnificent Seven" -- an elite group of tech powerhouses that consistently deliver profitable growth and exceptional returns to investors. This is a highly profitable business from selling ads on Search and YouTube. Its Google Cloud business is also growing, where it has $155 billion in order backlog from other companies needing access to cloud computing services.

Google is increasingly relying on its investments in artificial intelligence (AI) to make its services smarter and more helpful. This ensures it maintains a lock on its massive user base. Seven of its products, including Search and YouTube, have billions of users. Over 300 million users are paying regular subscription fees for services like YouTube Premium and Google One, which provides access to premium AI features powered by Gemini. This indicates a strong competitive moat for Google.

In the third quarter, the company's total revenue across all these services grew 16% year over year. The company's profits continue to outperform analysts' expectations. Adjusted earnings per share grew 35% year over year in the quarter. The consistent outperformance in earnings suggests that Alphabet could also outperform Wall Street's expectations for 16% annualized earnings growth in the coming years.

Assuming the stock continues to trade around its current forward earnings multiple of 25, which is a reasonable valuation for a company of this quality, investors should expect the stock to double in value by 2030.

2. Meta Platforms

Meta Platforms (NASDAQ: META) is another Magnificent Seven stock offering excellent return prospects. A $500 investment five years ago would already be worth over $1,000 today. Meta has 3.5 billion people across its family of apps. Instagram alone has over 3 billion monthly users, and its image-based feed makes it extremely attractive for advertisers. This is one reason why Meta was able to grow its revenue 26% year over year in Q3.

Like Google, Meta generates most of its revenue from digital advertising. The main risk that would keep these stocks from doubling in the next five years is another recession or slowdown in the advertising market. But given the massive customer reach for their services, these stocks should perform well for decades to come.

Meta's proprietary AI model, Llama, is powering the Meta AI assistant, which now has over 1 billion users. AI is making Meta's recommendation systems smarter, helping to keep users spending more time across its family of apps. This contributed to a 30% increase in video views on Instagram. When users are browsing more content, it means more ad revenue is heading Meta's way.

Meta continues to pour billions into building out its AI infrastructure, such as data centers, supporting its long-term growth plans. Despite this higher spending, it still reported a year-over-year increase in adjusted earnings of 20% in the third quarter. However, management's capital spending plans could pressure its earnings growth. Analysts have lowered their long-term annualized earnings growth assumptions to 10%.

Still, Meta has a history of generating high returns on capital. These investments should come back in the form of higher earnings over the long term. Analysts expect Meta's revenue to grow 16% on an annualized basis through 2029, doubling its 2024 revenue of $164 billion to $345 billion. Assuming Meta is able to convert that higher revenue into more profits, the stock should follow the company's revenue and, therefore, double in value by 2030.

John Ballard has no position in any of the stocks mentioned. The Motley Fool has positions in and recommends Alphabet and Meta Platforms. The Motley Fool has a disclosure policy.