We recently compiled a list of the 10 Best Cloud Stocks To Buy According to Hedge Funds. In this article, we are going to take a look at where Amazon.com, Inc. (NASDAQ:AMZN) stands against the other cloud stocks.
Based on a report by MarketsandMarkets, the global cloud industry in 2025 is projected to grow by 15.1% to $1,256.8 billion. While 2024 was marked by high adoption by the BFSI sector, the year ahead should see applications being developed that meet the unique specifications of each industry. North America and Europe should capture the bulk of the market size but APAC is expected to register the fastest growth. The integration of AI with cloud platforms accompanied by new service models is another key development expected to shape this industry.
Cloud ETFs have generated generous returns of 2.74%, 28.54% and 11.00% for 1-month, 6-month and 1-year tenors. One would assume that the underlying stocks would continue to perform well, propelled by strong industrial tailwinds.
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For this article we picked 10 cloud stocks trending on latest news. 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 275% since May 2014, beating its benchmark by 150 percentage points (see more details here).
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Amazon.com, Inc. (NASDAQ:AMZN)
Number of Hedge Fund Investors: 286
Amazon.com, Inc. (NASDAQ:AMZN) is the leader with AWS commanding almost a third of the cloud market share. This business grew by 19% y-o-y with the Q3 revenue reaching $27.5 billion. AMZN has leveraged the government spending on tech infra and has been a key provider of services to the US government. In a recent development, AWS has partnered with Booz Allen to ensure a seamless digital transformation for federal agencies. The solutions include cloud deployment, high-performance computing and cybersecurity.
AWS is also looking to make inroads in key growth markets like India, Mexico and the Middle East. The majority of AMZN’s capex of $74 billion in 2024 was directed towards AWS. This number is expected to rise in 2025. Investments for Saudi Arabia, Japan, the US, Europe and India have already been planned out for the next fiscal. The capacity expansion would enhance reliability and at the same time broaden the client base that is currently heavily concentrated towards large enterprises.
Overall AMZN ranks 1st on our list of the best cloud stocks to buy according to hedge funds. While we acknowledge the potential of 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 is originally published at Insider Monkey.
