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of Nasdaq Composite index We’re in record territory. While this is welcome news for some, it may be disappointing for those watching from the sidelines.
But don’t let a rising market stop you from looking for attractive investment opportunities. There are still some good companies selling at attractive valuations.
If you have $1,000 you’re ready to invest, there’s no need to look into the past Amazon (NASDAQ:AMZN).Here’s why it’s the ultimate growth stocks Buy now.
huge growth potential
Amazon generated $575 billion in net sales in 2023. This is more than the GDP of some countries such as Ireland and Thailand.And it only follows Amazon walmart in fortune 500 list.
Let’s be clear: Amazon is a huge organization when you look at these sales numbers. However, investors will be pleased to know that the business still has meaningful opportunities to expand thanks to multiple growth tailwinds.
Amazon’s business was built on the promise of expanding online shopping. Currently, almost 40% of all e-commerce spending in the United States occurs on his website in the United States. Online activity still has a long way to go to take share from in-store shopping, which should boost business in the coming years.
The popularity of Amazon Prime membership could not only lead to increased e-commerce sales, but also lead to more TV viewing time with Prime Video. So Amazon also benefits from that. streaming tendency.
Then there’s digital advertising, a segment that generated $14.7 billion in revenue in the past three months alone. This total increased 26% year over year.Amazon is the only company lagging behind in the US alphabet and meta platform In the industry, most investors may not be aware of it.
Perhaps the most interesting part of the equation is cloud partitioning. Amazon Web Services (AWS). Although growth in this sector has been slowed by macro headwinds, the industry-leading segment boasted operating margins of 30% in the fourth quarter.And AWS provides Amazon with a key deployment path artificial intelligence Bring innovation to your customer base.
pay the price
It’s not hard to convince someone that Amazon is a great business. The facts speak for themselves. No wonder the stock price has soared 8,300% over the past 20 years.
However, even if Market capitalization Now at around $1.9 trillion, it’s still a worthy investment candidate. That’s because Amazon stock currently trades at a price-to-sales multiple of just under 3.3 times. Even after the stock has soared 113% since the start of 2023, its valuation is roughly in line with its average over the past decade.
Paying Amazon that price seems like the right choice. This business has a number of competitive advantages and I am confident that it will grow well into the future. The company has scale and logistics footprint that its competitors cannot match, especially when it comes to better serving its customer base.
And more importantly, Amazon continues to develop its data advantage. Few companies can collect as much data from their customers as Amazon does. And executives can always find ways to glean insights to more effectively drive marketing and product development efforts.
But investors have more reason to be optimistic. After years of aggressive capital investment, management is now focused on reducing costs across the board and building a more efficient organization.
This means Amazon’s revenue could accelerate in 2023, with operating profit increasing 202%. And this could push the stock price even higher.
Now seems like a good time for prospective investors to add Amazon to their portfolios.
Should you invest $1,000 in Amazon right now?
Before buying stocks on Amazon, consider the following:
of Motley Fool Stock Advisor Our analyst team has identified what they believe Best 10 stocks For investors to buy now…and Amazon wasn’t among them. These 10 stocks have the potential to generate impressive returns over the next few years.
stock advisor We provide investors with an easy-to-understand blueprint for success, including guidance on portfolio construction, regular updates from analysts, and two new stocks every month.of stock advisor Since 2002, the service has more than tripled S&P 500 returns*.
See 10 stocks
*Stock Advisor returns as of March 11, 2024
Alphabet executive Suzanne Frye is a member of The Motley Fool’s board of directors. Randi Zuckerberg is a former head of market development and spokesperson at Facebook, sister of Meta Platforms CEO Mark Zuckerberg, and a member of the Motley Fool’s board of directors. John Mackey, former CEO of Amazon subsidiary Whole Foods Market, is a member of the Motley Fool’s board of directors. Neil Patel has no position in any stocks mentioned. The Motley Fool has positions in and recommends Alphabet, Amazon, Meta Platforms, and Walmart. The Motley Fool has a disclosure policy.
The Ultimate Growth Stocks You Can Buy Now for $1,000 is originally published by The Motley Fool.
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