7 Stocks on Jim Cramer’s Radar

1. Amazon.com, Inc. (NASDAQ:AMZN)

Number of Hedge Fund Holders: 286

Cramer mentioned Amazon.com, Inc. (NASDAQ:AMZN) during a recent episode. Here’s what Mad Money’s host had to say:

“Amazon, I’ll tell you, this is a multi-year move. We’re not to look at it on a quarter-to-quarter basis. I think it’ll be higher long term. I’ve been behind it now for 20 years. I’m not changing my view.”

Amazon.com, Inc. (NASDAQ:AMZN) has become a major force in the global tech industry, with its diverse portfolio spanning e-commerce, advertising, and subscription services. Over the last 20 years, AMZN stock has gained nearly 11,000%.

Tsai Capital stated the following regarding Amazon.com, Inc. (NASDAQ:AMZN) in its Q4 2024 investor letter:

“Amazon.com, Inc. (NASDAQ:AMZN) (AMZN—Year of First Purchase: 2017) Amazon was founded by Jeff Bezos in his garage in 1994 and today dominates the markets it serves. The company’s e-commerce business is gaining market share, despite its immense size, while its cloud services division, Amazon Web Services (AWS), is by far the leading cloud provider. We estimate that AWS now generates 60-65% of the company’s total operating profits.

Both Amazon retail and AWS benefit from numerous competitive advantages and deliver a high customer value proposition. Rather than leveraging its size to maximize short-term profits, the company follows a scale-economies-shared business model, sharing a generous portion of its margin with the consumer. This creates a flywheel effect that reinforces the company’s ecosystem.

 Amazon’s approach of investing heavily in the business today to create shareholder value later masks the company’s underlying earnings power. As consumers continue to shift their spending from in-store purchases to online shopping, and as data continues to migrate from on-premise servers to the cloud, we expect Amazon to grow revenues at a low double-digit rate for at least the next five years and to significantly increase its operating margins.”

While we acknowledge the potential of Amazon.com, Inc. (NASDAQ:AMZN) as an investment, 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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Disclosure: None. This article was originally published at Insider Monkey.