1. Amazon.com, Inc. (NASDAQ:AMZN)
Number of Hedge Fund Holders In Q3 2024: 286
Date of Cramer’s Comments: October 7th, 2024
Performance Since Then: 26.5%
Amazon.com, Inc. (NASDAQ:AMZN) is a key player in the eCommerce and cloud computing industries. Its cloud business offers the firm with AI exposure. Since Cramer’s remarks, the shares have gained 26.5% primarily due to a strong third-quarter earnings report and analyst optimism about the firm’s ability to generate revenue through artificial intelligence orders. Year-to-date, Amazon.com, Inc. (NASDAQ:AMZN)’s shares are up by 3.84% but dipped by 4% in February after its fourth-quarter earnings saw cloud revenue growth by 19% to $28.79 billion but missed analyst estimates of $28.87 billion. Here’s what Cramer had said in September:
“First downgrade, Amazon by Wells Fargo titled “Positive Revision Story on Pause Reducing to Equal Weight”. Totally get it, lots of headwinds, stock’s abused from the so-called bad quarter when Amazon fell from $184 to $161. Since then, it’s traded as high as $195, but it’s $186 as of last week. It’s time to sell? I’m not so sure.”
“What do these analysts fear? Amazon spending a lot on a ton of initiatives, worries about Walmart impact. So there’s a slight estimate cut, too. Wait a second. I say. How many times, how many times has Amazon been up against headwinds? Do you know how many times the company’s made some inexplicable moves? This is nothing new. Yet Amazon has always come back. It’s in their culture. It’s in their DNA. It always does.”
“I remember a year and a half ago when I was screaming at them because Amazon Web Services was underperforming. Came right back. Last time they reported, I was in disbelief at the Olympics and the attempted assassination of Donald Trump led to a light third-quarter sales guide. I was apoplectic at the Alexa losses and what happens? Comes right back.”
“So I say knock yourself out and sell it if you have to. Let me ask you, did you sell Amazon at $161 after that last supposedly bad quarter? How did it feel when the stock didn’t bounce to $195? Once again, I think it’s just a matter of time before Amazon bounces back. As usual. No hurry. Stock does seem to be headed lower, I’ve no doubt about that. I get it. But sell to buy it lower? Can you really get back in that? Too hard.”
AMZN is a stock Jim Cramer talked about last year. While we acknowledge the potential of AMZN as an investment, our conviction lies in the belief that some 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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