Amazon (AMZN) has seen significant growth fueled by positive earnings outlook and AI investments.

From Nasdaq: 2025-01-10 04:00:00

Amazon (AMZN) has surged 20% in the last three months, breaking out above its 2021 highs. Wall Street is rewarding Amazon for its transition into a mature company with massive earnings growth. Amazon leads in e-commerce, cloud computing, digital advertising, and AI chip development, competing against Nvidia.

Amazon’s revenue reached $574.79 billion in 2023, with earnings per share at +$2.90 after a downturn in 2022. FY24 earnings outlook is up 50% and FY25 outlook over 30%, with projected earnings of $6.32 a share in 2025. Amazon is set to post four years of low double-digit sales growth.

Amazon plans to invest over $100 billion in AI expansion, including a $4 billion investment in AI safety and research upstart Anthropic. Amazon’s Ultracluster will feature Trainium chips for AI training and inference. Amazon’s in-house-designed chips are used by various tech companies and deliver high performance at lower costs.

Amazon’s stock has soared, trading near all-time highs and below its 21-day moving average. With a PEG ratio offering 30% value compared to Tech, Amazon is a top long-term AI investment. 46 of 50 brokerage recommendations for Amazon are “Strong Buys,” making it a popular choice for investors.



Read more at Nasdaq: Bull of the Day: Amazon (AMZN)