Is It Too Late To Invest in Amazon Stock? Some Experts Think It Can Still Rise
Can Amazon stock still catch fire?
Amazon has been one of the market’s biggest winners over the past two decades, turning early investors into millionaires and growing from an online bookstore into a retail giant. With the stock having delivered substantial gains, you’re probably wondering if it’s too late to jump in.
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Financial experts say Amazon stock can still rise. Here’s why.
Amazon Continues To Benefit From the AI Boom
Artificial intelligence is one of the biggest opportunities facing the technology sector and Amazon is investing heavily to take advantage of it. The company is bringing AI to its retail business to improve product recommendations, personalize shopping experiences and optimize its large logistics network.
“Investments in AI will allow it to increasingly personalize the products it offers to customers via e-commerce,” said Alonso Rodriguez Segarra, CEO of Advise Financial. He said that these will create a compounding effect by driving higher sales, attracting more sellers to the platform and making Amazon’s competitive advantage even stronger.
AWS Remains a Powerful Growth Engine
While most consumers know Amazon as an online shopping platform, its most profitable business is Amazon Web Services (AWS), one of the largest cloud computing platforms. The demand for cloud services continues to grow as many companies adopt AI tools, store more data and move operations online.
Segarra believes Amazon’s investments in AWS have put the company in a position to continue to lead a market that’s expected to grow for years to come. The cloud business is a multibillion-dollar revenue generator and is an important source of cash flow for the company.
“If there’s one thing Amazon has consistently done well, it’s knowing when to stop investing in a sector that is not yielding good results,” Segarra said.
Amazon Has Multiple Growth Businesses Beyond Retail
A reason why some investors are still optimistic about Amazon stock is that it’s not dependent on one business segment. The company has created a number of multiple and growing streams of revenue.
“Amazon has five business lines with real momentum. That's a level of diversification that’s hard to find and that is what makes the stock interesting today,” said Will Allen, founder of Sentara Capital. In addition to e-commerce and AWS, he points to Amazon’s fast-growing advertising business, the Amazon Leo (formerly Project Kuiper) satellite internet project and the company’s development of custom AI chips to cut costs and reduce dependence on third-party suppliers.
This article is for informational purposes only and does not constitute financial advice. Investing involves risk, including the possible loss of principal. Always consider your individual circumstances and consult with a qualified financial advisor before making investment decisions.
This article was provided by MoneyLion.com for informational purposes only and should not be construed as financial, legal or tax advice.
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