1. Amazon.com, Inc. (NASDAQ:AMZN)
Number of Hedge Fund Holders: 308
Amazon.com, Inc. (NASDAQ:AMZN) is a leader in multiple tech sectors, including online retail, cloud computing (AWS), advertising, streaming, and AI. The company’s reach extends beyond the web, with the AWS IoT platform allowing it to connect vast networks of internet-connected devices and sensors to its cloud services for data analysis. The company has utilized its innovative technology to provide cutting-edge solutions for industrial and manufacturing companies with AWS IoT Sitewise.
Amazon.com, Inc. (NASDAQ:AMZN) reported strong Q2 2024 results with net sales reaching $148 billion, a 10% year-over-year increase. This growth was driven by all segments, with AWS showing the most significant jump at 19%. Operating income also rose significantly to $14.7 billion. Looking ahead, Amazon.com, Inc. (NASDAQ:AMZN) expects sales growth of 8% to 11% for Q3 2024.
Analysts are confident in Amazon.com, Inc.’s (NASDAQ:AMZN) future growth potential with its strong financial performance and diversification in different segments. The stock has received a consensus Buy rating with a 12-month target price of $222.8.
Here’s what Meridian Funds said about Amazon.com, Inc. (NASDAQ:AMZN) in its Q2 2024 investor letter:
“Amazon.com, Inc. (NASDAQ:AMZN) is a global technology company that operates e-commerce, cloud computing, digital advertising, and other businesses. We own Amazon because we believe it is well-positioned to benefit from several strong secular trends, including the shift to online shopping, the growth of cloud computing, and the increasing importance of digital advertising. The company exceeded expectations in the first quarter, with cloud-computing revenue growth accelerating, driven by easing cost optimization pressures and the ramp of generative AI workloads. The North American retail segment drove record operating margins, highlighting the success of Amazon’s efforts to improve efficiency and lower its cost to serve. International retail also showed promise, as emerging markets steadily progressed towards profitability. Given the strength across these key segments, we continue to hold the position in the company.”
Overall, Amazon.com, Inc. (NASDAQ:AMZN) ranks first among the 10 best Internet of Things (IoT) stocks to buy. While we acknowledge the potential of IoT companies, our conviction lies in the belief that AI stocks hold greater promise for delivering higher returns and doing so within a shorter timeframe. If you are looking for an AI stock that is more promising than AMZN but that trades at less than 5 times its earnings, check out our report about the cheapest AI stock.
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