Every investor has a goal of getting lucky and eventually finding
the goldmine of stocks - those that cost dirt cheaper to buy but eventually
become fabulously pricey. This happens when a company with low market
expectations takes off to the surprise of everyone - except for those few lucky investors that got in early. What have been some of the most profitable stocks in history?
Berkshire Hathaway
Berkshire Hathaway is an investment firm that was taken over by
Warren Buffet in 1965 and is currently the ninth largest public company in the
world. In 1962, one share of Berkshire Hathaway’s cost $7.56. After Buffet begun
changing the company’s investment strategies and adding on new clients, the
company began to experience rapid growth that has not stopped to this day. Today,
buying one stock for this company will cost you $170,420
each as one of the biggest increases in share price, in the history of the
stock market.
Poseidon
Poseidon is a nickel mining company that literally struck it rich
in the late 1960s by finding a massive metal deposit in Western Australia. It
caused Poseidon’s share price to shoot up from 0.8 Australian dollars to 12.30
dollars within a month, petering out at 280 dollars a share! This phenomenal
growth virtually overnight was short, and even became known as the “Poseidon
bubble” to refer to other similar types of situationally based and steep value
increases. Someone who bought 3,500 shares in 1969 for only about 2,800
Australian dollars would be a millionaire today.
Microsoft
Microsoft is synonymous with cheap stocks that have become highly profitable
over time. With the garage business turn global trailblazer dream actually
coming true, the business began as a team effort by two kids with an interest
in computers - Paul Allen and Bill Gates. Microsoft, still backed today by
business mogul Bill Gates, was actually turned down by a few tech companies
during its first years. When it started out in 1987, shares were as cheap as
$0.08 each. Now, they are worth over $36 each. If you had invested $3,000 in
Microsoft in 1987, you would be a millionaire today.
Cisco Systems
Cisco Systems has followed a similar trajectory, debuting on the
market at $0.08 a share and peaking during the tech boom at $77 for every
stock. If you had invested only $1,000 in Cisco in 2000, you could have become
a millionaire in a decade’s time. Even if you decided to stick with the still popular
and successful company, your stocks would be worth almost $21 each - an
impressive mark up from its buying price.
Like Microsoft, Google is a household name for a small, innovative
company that was able to make it big and change the world. Google debuted on
the market at the respectable sum of $85 a share and is now worth over $1,000
per stock. With such a large increase in value and popularity, it is no wonder
we have adopted this company’s name into our every day vernacular.
Although many have tried, but finding the common denominator
between these companies and their soaring stock prices is a difficult task indeed. At times, like with Poseidon, the
profit can be fleeting and the result of fortunate circumstances. In other
cases, like with many technological companies, it seems as if the market is ready
for that type of business and they happened to be in the right place at the
right time. With others, like Berkshire Hathaway, smart investment strategies
seem to make the difference. Look out for these qualities in this century’s
next most profitable stock.
Author: Nate Miller
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