We recently published a list of Top 10 AI News Everyone is Talking About. In this article, we are going to take a look at where Amazon.com, Inc. (NASDAQ:AMZN) stands against other top AI news everyone is talking about.
Jim Cramer in a latest program on CNBC talked about the ongoing “rebellion” against the data center and the impact of tariffs on the broader market. Cramer said that data centers have been a key story in the stock market for months but now it’s losing steam due to a variety of factors. He also mentioned the weakening economic indicators.
“I know these tariffs have people on edge. Consumer confidence indicators have just plummeted. Interest rates are sinking for fear of an economy gone soft. The key 10-year Treasury yield is back to where it was in mid-December when many thought we were looking at many more rate cuts than we’ve gotten. We have had to put rate cuts talk on hold. Now it’s right back because there’s a newfound paralysis—too many things happening at once, scaring people.”
Cramer said that the “seeds of doubt” about data center chip demand were sown following the launch of DeepSeek and the market is still reeling from its effects.
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For this article we picked 10 AI stocks the market is buzzing about these days. With each stock, we have mentioned the number of hedge fund investors. Why are we interested in the stocks that hedge funds pile into? The reason is simple: our research has shown that we can outperform the market by imitating the top stock picks of the best hedge funds. Our quarterly newsletter’s strategy selects 14 small-cap and large-cap stocks every quarter and has returned 373.4% since May 2014, beating its benchmark by 218 percentage points (see more details here).
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Amazon.com, Inc. (NASDAQ:AMZN)
Number of Hedge Fund Investors: 286
Jim Cramer in a latest program on CNBC talked about the possible impact on chip demand following the DeepSeek launch. He believes chip demand from Amazon.com, Inc. (NASDAQ:AMZN) could have a strong effect on Nvidia’s stock price.
“I think the biggest issue is we got through the hurdle of Meta saying they need it. We know that Oracle needs it without a problem. We absolutely got that. We know that Apple wants anything it can get and they’re a free rider, they’ll be good. But we know that Microsoft needs more. But what we don’t know is Amazon.com (NASDAQ:AMZN), and next week Amazon—what happens if Amazon says, It says, you know what, we don’t need as many, then you have this plummet.”
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.”
Overall, AMZN ranks first on our list of top AI news everyone is talking about. While we acknowledge the potential of AMZN as investment, our conviction lies in the belief that under the radar 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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Disclosure: None. This article is originally published at Insider Monkey.
