Is Investing in Amazon Correct Step Now?

Is Investing in Amazon Correct Step Now?

Since the rate of online shopping continues to rise during the outbreak, Amazon (AMZN) has had multiple business units in the next few years, which should bring strong revenue growth and rising profit margins. Now, as the second quarter earnings approach, we'll look at whether Amazon stock is bought. Analysts stated that Amazon is positioned to take advantage of changes in consumer behavior and the way companies do business. Monness Crespi Hardt analyst Brian White wrote a note to customers on June 29: "We believe that the Covid-19 crisis will return to Amazon in a bigger way, with the destructive parts of the US that were largely unharmed." With this report, Amazon increased its price target on stock from 2,800 to 3,500 and kept its purchase rating. Cowen analyst John Blackledge raised the price target in Amazon stock from 2,750 to 3,700, which is among the highest on Wall Street. A study by Cowen for Amazon users found that the coronavirus "has increased consumer online buying habits and this dynamic has remained intact over the past few weeks". This is especially true for consumers participating in the Amazon Prime customer reward program. With Amazon Prime, consumers get a lot of benefits such as free shipping, music and video content by paying annual fees. About 52% of Amazon Prime customers stated that they increased their purchases compared to 32% among non-Prime households. There are also approximately 69 million Prime subscribers in the USA.

Amazon Stock Rises from a Year's Low

Amazon stock has recently reached record highs, with an 87% recovery since it saw its lowest level of a year on March 16, a date when the outbreak feared stocks. Those who own Amazon stock feared the potential negative effects of investments on infrastructure, competitive pressures in cloud services, increased spending on a one-day shipping schedule and its impact on profits.

Amazon Heads to New Domains

Transportation is among the bold steps of Amazon for new markets. Amazon invested $ 700 million a year ago in electric truck maker Rivian. Amazon's founder, Jeff Bezos, said the company had ordered 100,000 electrical distribution vehicles from Rivian, a Michigan-based company. There is also a $ 530 million funding round as part of the self-driving automated Aurora Innovation. Last month, Amazon announced plans to purchase Zoox by expanding its pressure on ongoing vehicle technology. The report revealed that Amazon paid more than $ 1.2 billion.

Amazon Stock Analysis

The IBD Inventory Control Instrument shows that Amazon stock has an IBD Composite Rating of 98 out of 99. The rating means that Amazon stock is currently performing better than 98% of all stocks in terms of basic and technical stock picking criteria. It also has a Relative Strength of 94, which measures the price performance of a stock over the past 12 months compared to all other stocks. It has an EPS Rating of 82 that compares quarterly and annual earnings per share with all other stocks.