Is It the Right Time to Invest in Amazon Stock? It Certainly Seems So

The stock of Amazon has gained 3 percent year to date, and the current price of US$ 3298.99 (about CA$ 4161.68) is quite good. Amazon Stock is expected to continue growing as digitalization is happening rapidly, and the shift towards online commerce is continuing at a decent pace.

In the Q2 results that were released recently, Amazon posted a revenue of US$ 113.1 (about CA$ 142.68) billion. It was up by 27 percent year on year, and the earnings increased to US$ 15.12 (about CA$ 19.07) per diluted share. It was just US$ 10.20 (about CA$ 12.87) per diluted share in the same period last year. Here are a few other reasons it might be the right time to invest in Amazon stock.

Live Streaming is On

Amazon is making new strides in live streaming as it has signed a deal with Ligue 1 in France and will stream more than three hundred matches per season.

Estimated Revenue

Amazon’s revenue can grow by 27 percent and reach US$ 488 (about CA$ 615.61) billion for this year. The net income might also increase to US$ 29.5 (about CA$ 37.21) billion. If that happens, it will increase the 2021 EPS figure to US$ 63.46 (about CA$ 80.05).

Amazon Stock Performance Since 2019

Since the end of 2019 (when the COVID-19 pandemic was something distant), Amazon’s stocks have grown by 75 percent. It was US$ 1848 (about CA$ 2331.25) at that time, and now it’s at US$ 3298.99 (about CA$ 4161.68). It is better than S&P, which has gained only 69 percent in the same duration.

The Impact of Coronavirus Pandemic

The coronavirus pandemic has proven beneficial for Amazon as the customer preference shifted from traditional commerce to online commerce. One of the key factors in the revenue growth during the first quarter of 2021 was the international segment that recorded a 60 percent growth (year on year).

The Future Growth Drivers

The shift towards online commerce seems irreversible at the moment, and countries from all over the globe are adopting it. Organizations are also depending more on Amazon Web Services, and they will continue to do so in the near future.

Change of Leadership

Though there isn’t a doubt about the fact that Jeff Bezos is brilliant, and he has done an excellent job with Amazon, it’s time to look ahead. The new CEO of Amazon, Andy Jassy, is more soft-spoken and even-keeled than Jeff Bezos. He is a champion when it comes to focusing on the details.

After graduating from Harvard Business school, he joined Amazon and successfully led AWS since the cloud computing unit formation in 2003. Now, more than half of the company’s profit comes from AWS. It posted a profit of US$ 52.7 (about CA$ 66.48) billion in revenue in the last 12 months only. If it were a stand-alone company, AWS would be the 61st largest company by sales in the US. So, Jassy might be the right choice for taking Amazon stocks to new highs in the future.

Final Words

There are numerous reasons why investing in Amazon Stock is a smart move. Do you agree? Let us know what you think by leaving a comment below! 

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