Amazon is the Hottest FANG Stock in 2020
At a time when the entire stock market had its worst day since October 2019, Amazon’s stock was up more than 10%. How could this be? Amazon was one of the few FANG stocks to miss out on an epic BigTech rally in late 2019, but it was not to be denied.
Amazon briefly hit a $1 trillion market cap on Friday after a blowout earnings report for the fourth quarter of 2019. It beat estimates across the board and in 2020 is set to move higher.
Microsoft and Amazon are both essentially $1 Trillion dollar companies now for the Seattle area. Both are incredibly well diversified with AWS and Advertising really soaring for Amazon, adding to the wealth of Bezos in epic ways.
As strong as Azure’s growth is, it’s not like AWS is slowing down. Amazon’s cloud business generated $9.95 billion in sales, up 34% from the year-ago quarter. Google and Facebook are essentially one-trick ponies compared to companies like Microsoft, Amazon and Apple. Apple has relatively strong iPhone sales, wearables and services, while Microsoft is one of the most reliable tech stocks around in 2020.
Amazon isn’t impulsive in spending, though it might seem that way sometimes. It keeps pouring billions into its one-day delivery service. Many on Wall Street are wondering whether that strategy will increase or decrease Amazon’s future profits. However, Amazon is becoming a logistics, healthtech and automation company with strong ties to EV maker Rivian. It’s AI and Ads units will have an incredible decade.
Amazon’s stock has officially surged past the $2,000 mark again. That’s almost a quarter of a Bitcoin.
Amazon is a cloud computing giant that’s equally competitive against Walmart, Costco, Target and others. E-commerce growth is still occurring 8-10x faster than other retail segments. In the next few years Amazon will evolve as a digital advertiser, original content producer and AI leader.
How good were Amazon’s earnings? Amazon CEO Jeff Bezos added $13.5 billion to his fortune in 15 minutes! Amazon could spin off AWS at this point and it would reduce scrutiny that’s coming the way of Google and Facebook in 2020 probes and antitrust fines.
Amazon also gave upbeat guidance for the first quarter and provided updated figures on Prime subscribers, saying it now counts more than 150 million paying members in the program. Compare that to Netflix having 158.5 million subscribers globally.
Advertising growth? It grew over 40% in Q4 of 2019. Amazon’s advertising business grew by about 40% year over year, in line with the annual growth of the overall “Other” segment, CFO Brian Olsavsky told investors during the company’s Q4 and year end 2019 earnings call Thursday.
How much in total sales? It has revenue of $87.4 billion, net income of $3.3 billion with AWS as a $40 Billion business. Over the last decade Amazon has become one of the most powerful, respected and feared companies in tech and beyond.
What can Amazon become in the 2020s and 2030s? It could become the only American Tech company able to withstand China’s rising technological dynasty. Amazon’s innovation-centric culture can continue to make progress as a platform the scale of which we have not seen before.