Amazon’s recent decline seems to be an overreaction, with its business still strong. Earnings season has hit AI stocks hard, with AMD and Microsoft shares dropping after quarterly updates. Amazon’s stock fell 6% following its Q4 report, but it’s predicted to rebound in 2026. The company’s long-term moats are key.

Amazon’s decline was due to missing earnings estimates and forecasting a $200 billion capex for 2026. However, special charges impacted EPS, and revenue beat expectations. Most capex will go to AWS, with high demand driving investments. AWS revenue soared 24% in Q4, and advertising and e-commerce businesses are performing well.

Despite the short-term sell-off, Amazon’s business continues to excel. Revenue and earnings rose in Q4, with AWS seeing strong growth. Ad revenue and e-commerce are thriving, especially in international markets. Amazon’s low prices and scale provide a wide moat for long-term success.

Investors should consider buying Amazon stock now, as past declines have led to strong rebounds. The company’s wide moat and strong business fundamentals make it a compelling investment opportunity. For the 10 best stocks to buy now, check out the latest recommendations from the Motley Fool Stock Advisor team. 1. The stock market saw a significant drop today, with the Dow Jones Industrial Average falling by 500 points. This was attributed to concerns over rising inflation and the Federal Reserve’s plan to raise interest rates in the coming months.

2. A new study revealed that the Arctic is warming at a faster rate than previously thought. Researchers found that temperatures in the region have increased by 1.5 degrees Celsius since the 19th century, leading to accelerated ice melt and rising sea levels.

3. The latest unemployment numbers show a decrease in jobless claims, with 200,000 new claims filed last week. This is the lowest number of claims in over 50 years, signaling a strong job market and economic recovery.

4. The FDA approved a new drug for the treatment of Alzheimer’s disease, marking the first new treatment for the condition in nearly two decades. The drug, Aduhelm, has shown promising results in clinical trials and is expected to help millions of patients with the disease.

Read more at Nasdaq: Prediction: Amazon’s Sell-Off Will Set Up a Monster Rebound in 2026