Despite a large sell-off after earnings, Amazon.com Inc.’s (NASDAQ: AMZN) shares are up 15% year to date to $776.32. Inventors have not given up on the huge e-commerce holiday results altogether.
Oddly, Amazon’s shares are up by about the same amount as those of rival Wal-Mart.
The arguments in favor of a bright future for Amazon fall into three camps. The first is that, while the third quarter was rough, its relentless march to take more and more retail market share has not ended. It is willing to compress margins, as it traditionally has, to bring in business. Research continues to show that more and more people shop online.
The second argument is that Amazon has products that tether customers to it in ways other retailers cannot. The first among these is Amazon Prime, a combination of free shipping, video streaming and photo storage. And Amazon has consumer electronics devices that help glue customers to its business. First among these is Alexa, Amazon’s voice control system.
Finally, Amazon is the leader in white-hot cloud computing, a business that probably will be larger than its e-commerce one in a few years. In the September quarter, AWS had revenue of $3.2 billion, up from $2.1 billion the year before. Its operating income doubled to $1 billion.
Amazon could close the year much higher.
Take This Retirement Quiz To Get Matched With A Financial Advisor (Sponsored)
Take the quiz below to get matched with a financial advisor today.
Each advisor has been vetted by SmartAsset and is held to a fiduciary standard to act in your best interests.
Here’s how it works:
1. Answer SmartAsset advisor match quiz
2. Review your pre-screened matches at your leisure. Check out the
advisors’ profiles.
3. Speak with advisors at no cost to you. Have an introductory call on the phone or introduction in person and choose whom to work with in the future
Take the retirement quiz right here.
Thank you for reading! Have some feedback for us?
Contact the 24/7 Wall St. editorial team.
Editors' Picks
