1. Amazon.com Inc (NASDAQ:AMZN)
Number of Hedge Fund Holders: 308
Amazon.com Inc (NASDAQ:AMZN) is a technology company that specializes in e-commerce, online retail, streaming, and data cloud services. Its e-commerce platform is functional in 20 countries and ships to over 100 countries. Its proprietary cloud service, Amazon Web Services, on the other hand, is used by millions of active customers and has over 130,000 AWS partners across 200 countries.
The company is on track to capture over 40% of the e-commerce market in the United States. As for its cloud segment, AWS has logged 30% plus operating margins consistently for the past five quarters, making it a star performer.
Amazon.com Inc (NASDAQ:AMZN) is also making strides on the AI front. Over the past few months, the company has partnered with AI startups like Anthropic and signed deals with the US government to test new AI models. As for AI hardware, the company has produced several AI chips to reduce its dependence on other companies. Speaking of AI, AWS is now housing the next generation of Llama models from Meta, giving customers more choices to build, deploy, and scale generative AI applications. The new models are capable of visual reasoning, document processing, and multilingual translation.
Amazon’s growth is undeniable which explains its position on our list. Analysts are bullish on AMZN and their 12-month median price target of $220 points to a 17% upside from current levels. Overall, AMZN was held by 308 hedge funds and Fisher Asset Management was the largest shareholder, according to the Insider Monkey database.
Meridian Hedged Equity Fund stated the following regarding 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, AMZN ranks first among the 7 best stocks to buy for long term. At Insider Monkey, our conviction lies in the belief that AI stocks hold greater promise for delivering higher returns, and doing so within a shorter time frame. 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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