Is it Still Safe to Invest in Amazon (AMZN)?

ClearBridge Investments, an investment management firm, published its “Large Cap Growth Strategy” third quarter 2021 investor letter – a copy of which can be downloaded here. The ClearBridge Large Cap Growth Strategy underperformed its Russell 1000 Growth Index benchmark during the third quarter. On an absolute basis, the Strategy had gains across four of the eight sectors in which it was invested (out of 11 sectors total). The leading contributors to performance were in the IT and health care sectors, while the consumer discretionary and industrials sectors were detractors. You can take a look at the fund’s top 5 holdings to have an idea about their best picks for 2021.

ClearBridge Large Cap Growth Strategy, in its Q3 2021 investor letter, mentioned Amazon.com, Inc. (NASDAQ: AMZN) and discussed its stance on the firm. Amazon.com, Inc. is a Seattle, Washington-based e-commerce company with a $1.6 trillion market capitalization. AMZN delivered a -2.50% return since the beginning of the year, while its 12-month returns are up by 2.15%. The stock closed at $3,251.08 per share on January 07, 2022.

Here is what ClearBridge Large Cap Growth Strategy has to say about Amazon.com, Inc.  in its Q3 2021 investor letter:

“While Amazon.com and Facebook, the Strategy’s overweights in the mega cap group, underperformed both their FAAMG peers and the benchmark in the third quarter, we maintain conviction in these names because they have the highest growth profiles. Amazon is projected to grow earnings per share at 19% next year and Facebook at 13%, while Apple is expected to see only breakeven earnings in 2022 (Exhibit 1). Amazon is spending at an elevated level right now, but the underlying demand trends are healthy, and we believe that once the rate of spending moderates, returns will improve.”

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Based on our calculations, Amazon.com, Inc. (NASDAQ: AMZN) ranks 3rd in our list of the 30 Most Popular Stocks Among Hedge Funds. AMZN was in 242 hedge fund portfolios at the end of the third quarter of 2021, compared to 271 funds in the previous quarter. Amazon.com, Inc. (NASDAQ: AMZN) delivered a -1.14% return in the past 3 months.

In October 2021, we also shared another hedge fund’s views on AMZN in another article. You can find more than 100 investor letters from hedge funds and prominent investors on our hedge fund investor letters 2021 Q3 page.

Disclosure: None. This article is originally published at Insider Monkey.