2 Breakout Growth Stocks You Can Buy and Hold for the Next Decade

Every year, some stocks break out with massive returns, but the ones that truly become stars are those that can sustain those gains over the long haul.

In 2025, two of the most notable breakout stocks were Western Digital (NASDAQ: WDC) and Micron Technology (NASDAQ: MU) -- digital memory specialists that saw demand for their wares propelled higher by surging investments in artificial intelligence (AI) infrastructure.

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Over the past 12 months, Western Digital has risen a whopping 465%, including a 60% return already this year. Micron stock has gained 313% over the past year, including a 35% increase year to date. Yet even after these massive gains, both stocks remain strong long-term buys.

Why these breakout stars will continue to shine

There are some common threads that should make Western Digital and Micron stocks long-term growers.

First, both of these companies are dominant players in their respective parts of the tech industry, and they are recipients of surging demand due to the AI infrastructure buildout.

Micron makes high-bandwidth memory chips for AI data centers, and it's one of three major players in that market. The memory chip industry is in a supercycle -- an extended boom cycle -- with demand outpacing supply because the AI data center infrastructure buildout requires an abundance of these types of chips. Micron already has sales agreements in place for all of the chips it will be able to manufacture and deliver in 2026.

Western Digital, which makes hard disk storage drives for AI data centers, has an even wider moat: It's one of the two major players that dominate its industry. And like Micron, it is experiencing massive demand due to the rapid buildout of new data centers and AI infrastructure.

Overall demand for the high-bandwidth memory chips that Micron makes is expected to grow 15-fold by 2035, according to a forecast from market research firm IDTechEx. Meanwhile, the storage market that Western Digital serves is expected to grow at a 24% compound annual growth rate through 2035, per research by MarketsandMarkets.

Both of these stocks are relative bargains

The second beneficial attribute that these two AI stocks share is a reasonable valuation. Despite its sharp growth recently, Western Digital is trading at just 25 times earnings, which is under the S&P 500 average, and based on analysts' projections, it has a five-year price/earnings-to-growth (PEG) ratio of about 0.9, which puts it in value territory.

Similarly, Micron has a price-to-earnings (P/E) ratio of 36 but a forward P/E of just 11, which means it remains a bargain relative to its earnings potential. Its five-year PEG of just under 0.7 is also in value territory, even lower than Western Digital.

When you consider their reasonable valuations, the dominance both display in their respective industries, and the massive growth expected for both of their addressable markets, it is clear to see why we can expect these two technology stocks to have nice long runs of success.

Dave Kovaleski has a position in Micron Technology. The Motley Fool has positions in and recommends Micron Technology and Western Digital. The Motley Fool has a disclosure policy.