Amazon Stock (NASDAQ:AMZN)
Amazon stock jumped as much as 6.1% on Tuesday morning. The stock was 5.2% higher at 12:53 p.m. ET.
Even if the general market rally on Tuesday had a role in the e-commerce giant’s price increase, it was not the only one.
What’s the Reason
JPMorgan analyst Doug Anmuth said the online group is showing “growing interest in certain names” despite the difficulties caused by the present macroeconomic environment since the recent market drop has made several appealing stocks buy more accessible. Amazon (NASDAQ:AMZN) is still his “greatest concept” in the industry and represents one such possibility.
The analyst believes that Amazon (NASDAQ:AMZN) will accelerate its year-over-year revenue growth, expand its margins, and reduce its capital spending, all of which will drive “significant” free cash flow growth into next year despite the macro backdrop, unfavorable exchange rates, and overall underperformance of internet-related stocks.
As Amazon becomes a more formidable player in digital advertising, an analyst at Bank of America, Justin Post, has cut his price predictions for both Meta Platforms and Alphabet.
What Should You Do Now?
Both experts have valid arguments to offer. After Amazon’s huge e-commerce profits during the epidemic, investors generally wrote off any future expansion. Amazon (NASDAQ:AMZN) CFO Brian Olsavsky said on the firm’s second-quarter earnings call that the business had lapped this high-growth era, resulting in softer comps and more excellent year-over-year growth rates.
Amazon (NASDAQ:AMZN) is also swiftly becoming a digital advertising giant, with its ad revenue growing by around 21% year over year over the last 12 months. This growth accelerated while that of Alphabet stalled and that of Meta dropped.
Amazon stock is selling at its lowest value in almost seven years, at around 2 times expected revenues for the following year.
Amazon stock (NASDAQ:AMZN) is a no-brainer investment because of the company’s market dominance in e-commerce and cloud computing, rising profile in digital advertising, and low pricing.
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