2 No-Brainer Growth Stocks to Buy With $200 in July and Hold at Least a Decade

One of the biggest misconceptions about investing is the idea that you need to have lots of money to get started. Now that discount brokerages have done away with stock trading fees, investors who build their portfolios with pocket change can perform just as well as folks who have millions to work with.

Right now, two outstanding stocks highlight just how easy it is to get started with investing in small increments. At recent prices, $200 is enough to buy a full share of both Nvidia (NASDAQ: NVDA) and Sportradar Group (NASDAQ: SRAD). Both of these well-positioned businesses have strong advantages that could allow them to outperform the competition in the decade ahead.

Where to invest $1,000 right now? Our analyst team just revealed what they believe are the 10 best stocks to buy right now. Continue »

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1. Nvidia

Even the fear of new tariffs can't stop the largest cloud service providers from buying Nvidia's graphics processing units hand over fist. The designer of the chips that most artificial intelligence (AI) applications rely upon reported fiscal first-quarter sales that surged 12% from the previous quarter and 69% from the previous-year period.

Investors excited about the rapid growth of Nvidia's GPU sales pushed shares of the stock up 67% from a low point it reached in April. Expected spending on data centers could push it even higher. Late last year, four of the world's largest tech companies forecast upcoming data center investments worth a combined $300 billion in 2025. Looking further ahead, CEO Jensen Huang is predicting annual data center spending will top $1 trillion by 2028.

Big tech's data center ambitions suggest significant growth ahead. Nvidia's fiscal first quarter ended on April 27 with just $156 billion in annualized data center revenue.

A strong network effect means investors can reasonably assume Nvidia will absorb heaps of AI data center spending in the years ahead. Nearly all developers of AI applications are already familiar with CUDA, the software development kit (SDK) specific to Nvidia's products. Even if Nvidia's competitors build superior chips at a discount, developers already know that selling them without an SDK is an uphill battle.

Despite a strong competitive advantage and clear data center building intentions from the world's biggest tech businesses, Nvidia stock has been trading at 36.8 times forward earnings estimates. This is a high valuation if you assume Huang's prediction regarding the next few years of data center spending is too ambitious. For investors with a high risk tolerance who think AI is here to stay, this is a great stock to buy now and hold over the long run.

2. Sportradar Group

In 2018, the Supreme Court paved the way for legalized sports betting. Now, 38 states offer it, and more are on the way.

It's easy for gamblers to switch applications when placing a bet. Whether they use a service from Flutter or DraftKings, Sportradar Group or Genius Sports is more than likely providing the data.

In the U.S., Sportradar Group has partnerships with the NBA, NHL, NASCAR, and MLB. Headquartered in Europe, Sportradar also has partnerships with larger international organizations like FIFA. Except for Genius Sports, there aren't any competitors with nearly as large a footprint in the sports data niche.

Recently, Sportradar secured exclusive rights to distribute low-latency betting data from the ongoing FIFA Club World Cup. With heaps of cameras already set up in stadiums around the world, Sportradar was an obvious choice for FIFA.

Sportradar reported first-quarter sales that rose 17% year over year and expects further growth at this pace. In the western hemisphere, the overall sports betting market is expected to climb by 17% annually through 2029. Without just one viable competitor in sight, management expects total revenue to grow by at least 15% annually over the next three years.

Sportradar stock has been trading at 53 times its trailing free cash flow. This looks like an extremely steep valuation, but not once you factor in management's expectation to grow free cash flow by at least 33% annually over the next three years.

A high valuation means the bottom could fall out from under this stock if management can't meet its forecasts. Given the high barriers to entry in this rapidly growing niche industry, I won't be surprised if the company blows past its forecasts. Adding some shares to a diversified portfolio now and holding on for at least a decade looks like a smart move.

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Cory Renauer has positions in Sportradar Group Ag. The Motley Fool has positions in and recommends Nvidia and Sportradar Group Ag. The Motley Fool recommends Flutter Entertainment Plc and Genius Sports. The Motley Fool has a disclosure policy.