1. Amazon.com, Inc. (NASDAQ:AMZN)
Number of Hedge Fund Holders: 271
Share Price (as of June 9): $116.15
Amazon.com, Inc. (NASDAQ:AMZN) is perhaps the safest, most sought-after blue chip stock in the market. On June 6, the company’s previously announced 20:1 stock split came into effect, pricing the shares down from above $2000 to $120. As of June 9, Amazon.com, Inc. (NASDAQ:AMZN) shares are priced at $116.15. This opens the door for retail investors to purchase shares of the biggest e-commerce player in the United States.
On June 6, MKM Partners analyst Rohit Kulkarni maintained a ‘Buy’ rating on Amazon.com, Inc. (NASDAQ:AMZN) shares, and set a price target of $180, roughly in-line with his previous target of $3,625. He thinks Amazon is the best “safe haven” internet stock within the current economic climate, and sees it as the most diversified internet company in the world. Recent media reports have stated that Amazon.com, Inc. (NASDAQ:AMZN) is building a local advertising business, in hopes of competing with the hefty ad revenues drawn by Alphabet Inc. (NASDAQ:GOOG) and Meta Platforms Inc. (NASDAQ:FB).
271 hedge funds held positions in Amazon.com, Inc. (NASDAQ:AMZN) at the end of the first quarter, with an aggregate value of more than $48 billion. This made it the most popular stock in the Q1 database of Insider Monkey.
Investment firm Polen Capital talked about Amazon.com, Inc. (NASDAQ:AMZN) in its Q1 2022 investor letter. Here’s what the fund said:
“Amazon has done a terrific job managing through the pandemic, in our view. Many companies struggled to pivot their business model during COVID-19, which represented an existential threat. Amazon had the opposite problem – a surge in demand. The company leaned into this by entering an extremely heavy investment cycle, doubling its fulfillment network and headcount over the past two years. To put this into context, Amazon added 273,000 employees in the last half of 2021 on top of over 400,000 employees the prior year. The company has also made significant Capital Expenditures, adding IT infrastructure for AWS and transportation capacity during this period. This all took place in the face of inflation related to wage increases and higher pricing from third-party carriers supporting the company’s fulfillment network. These heavy investments paid off—AWS grew 40% year over year, reached a $71B annual run rate, and total company revenue posted a two-year annual compounded growth rate of 25%. We believe this heavy investment cycle, like Amazon’s previous ones, will continue to support ongoing growth and will further separate Amazon from its competition while also providing the ability to increase margins through economies of scale. With respect to the margins specifically, AWS and Advertising – two fast-growing businesses – continue to contribute greater operating earnings to the overall business. We believe management has done an excellent job managing through this period and that the company is even stronger today than when COVID-19 first began to spread around the world.”
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