Amazon.com Inc. (AMZN) is one of the world’s leading technology companies focused on e-commerce, cloud computing, artificial intelligence, and digital entertainment.

The company is widely recognized for its role in revolutionizing the way people shop and access digital services. In the global stock market, Amazon’s stock plays an important role as one of the indicators of the technology sector’s performance.

With its large market capitalization and widespread influence, Amazon’s stock is often a major focus for investors and financial analysts around the world.

What Is Amazon (AMZN) Stock?

Amazon stock is a form of ownership of Amazon.com Inc., a multinational corporation engaged in e-commerce, technology, and digital services.

The stock is publicly traded on the NASDAQ stock exchange under the ticker symbol “AMZN”. By owning Amazon stock, an investor indirectly owns a small part of the company, including rights to its potential profits and assets.

Amazon stock is often targeted by investors because it reflects the value of one of the most innovative and influential technology companies in the world.

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Significance of Amazon Stock

Amazon stock is included in the blue-chip stock category, which indicates the company’s strong reputation and financial stability. With a large market capitalization, this stock is often considered one of the most influential in the global stock market.

In addition, Amazon stock is known as a growth stock, which shows the potential for high value growth along with business expansion and company innovation.

The performance of this stock has shown a consistent upward trend over time, making it an attractive choice for investors looking for long-term opportunities.

Advantages of Amazon Stock

One of the main advantages of Amazon stock is the company’s business diversification which covers various sectors.

In addition to being a leader in e-commerce, Amazon has a dominant position in cloud computing services through Amazon Web Services (AWS) and continues to expand its influence in the digital entertainment industry.

Consistent revenue and continuous innovation then become a strong foundation that supports the stability and growth of this stock.

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Who is Suitable to Invest in Amazon Stocks?

Basically, Amazon stocks are ideal for investors or those who want investments with high growth potential in the long term.

In addition, with the volatility that often occurs in technology stocks, traders can also take advantage of Amazon’s stock price movements to make short-term profits.

Amazon Company Profile

Amazon was founded by Jeff Bezos on July 5, 1994 in Bellevue, Washington, with an initial focus as an online bookstore. However, this company continues to grow rapidly to expand into various sectors, making it one of the world’s technology giants today.

Amazon’s vision is to become “the world’s most customer-centric company”, with the goal of providing everything consumers want online.

Its mission is to provide convenience for customers through quality products, services, and experiences at competitive prices.

Amazon also continues to expand its operations into various sectors. One important milestone was the launch of Amazon Web Services (AWS), which is now a leader in cloud computing services.

In addition, Amazon has also expanded its reach into hardware with products such as the Amazon Echo and Kindle, and strengthened its position in the entertainment industry with its Prime Video streaming service and original content production.

Main Products and Services

Amazon is known to offer a variety of products and services that cover the following sectors:

 

E-Commerce

Amazon Marketplace is an e-commerce platform that connects sellers and buyers to make transactions online. In 2021, the service reportedly had more than 300,000,000 active users worldwide.

Meanwhile, Amazon Prime completes the shopping experience by offering fast shipping, access to video and music streaming services, and exclusive offers. As of 2021, Prime subscribers were recorded to have exceeded 200,000,000 globally.

 

Cloud Computing

Amazon Web Services (AWS) is a leading cloud computing service provider that offers computing infrastructure and platforms to businesses and individuals. As of 2021, AWS reportedly has over 1,000,000 active customers worldwide, making it the market leader in the sector.

Hardware: Amazon also develops a variety of smart devices, including the Amazon Echo with Alexa, Kindle for digital readers, and Fire TV for home entertainment. These products have become an integral part of Amazon’s technology ecosystem.

 

Digital Entertainment

Amazon provides a variety of digital entertainment services, such as Prime Video for streaming movies and series, Amazon Music for enjoying music, and other services. Amazon continues to expand its reach in the industry to provide a complete entertainment experience for its customers.

Additional Retail Services

Amazon Fresh is a grocery and daily necessities delivery service, available in several major cities in the United States and several other countries. This service is designed to offer ease and convenience in meeting daily needs.

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Challenges Faced

Amazon faces a number of challenges, including criticism of working conditions at some of its facilities.

Several reports have suggested that workers in Amazon warehouses face high pressure with tight targets, raising concerns about their welfare.

Not only that, Amazon also has to compete in the global market with other giants, such as Alibaba and Walmart.

Both companies offer similar services with aggressive strategies in e-commerce and logistics, creating increasingly fierce competition for Amazon in the international market.

On the other hand, regulations from governments in various countries are also a challenge, especially regarding data privacy, taxation, and anti-monopoly policies.

Amazon Stock Performance

Amazon’s stock has shown extraordinary performance since the company’s IPO in 1997.

From a relatively low initial price, Amazon’s stock has experienced significant growth despite fluctuations influenced by market dynamics and global economic conditions.

Stock Price Performance Over Time

Amazon conducted an initial public offering (IPO) in 1997 at a price of $18 per share.

Since then, Amazon’s stock price has experienced a significant growth trend despite fluctuations influenced by global market conditions and the technology sector.

Recent Financial Performance

In the third quarter (Q3) of 2023, Amazon reported revenues of $143,080,000,000, an increase of 12.6% compared to the same period the previous year.

One of the main factors supporting this financial performance is the significant contribution of Amazon Web Services (AWS), which provides substantial operating profit, offsetting lower margins from the e-commerce sector.

Amazon Stock Valuation

Citing data from id.investing.com, Amazon’s Price-to-Earnings (P/E) ratio is currently at 47.9x, indicating high market expectations for the company’s future growth.

When compared to peers in the technology sector, which have a P/E ratio of 12.7x, and the sector average of 10.8x, Amazon’s P/E ratio suggests that investors are willing to pay more for its perceived greater growth potential.

Also Read: Complete Guide to Google Stock: History, How to Buy, and Future Prospects

Prospek Masa Depan Saham Amazon

Amazon has bright growth prospects, driven by strength in e-commerce, innovation in AWS, and increased operational efficiency. These factors have the potential to strengthen Amazon’s stock performance in the future.

 

Growth in the E-Commerce Market

Amazon continues to maintain its dominance in the e-commerce market, especially in the US market, by offering a variety of products and services that meet consumer needs.

In addition, the company has a global expansion plan to expand its footprint into international markets, where e-commerce growth is expected to continue to increase.

This strategy has the potential to provide a major boost to Amazon’s revenue in the future.

 

AWS Innovation

Amazon Web Services (AWS) plays a key role in Amazon’s revenue growth, providing cloud computing services used by millions of companies worldwide.

Continuous innovation at AWS, including the development of new technologies and service expansion, will continue to drive Amazon’s revenue growth, which is increasingly relying on this sector as one of its main pillars of revenue.

 

Operational Efficiency

Amazon is also focused on increasing operational efficiency, primarily through the use of robotic technology in the supply chain and delivery process.

By integrating automation and advanced technology, Amazon can reduce operational costs and increase the speed and accuracy of delivery, which provides a sustainable competitive advantage in the global e-commerce market.

 

How to Invest in Amazon Stocks

If you want to invest in Amazon stocks, you can buy the shares directly on a global stock exchange, one of which is NASDAQ. Here are the steps:

• First, choose a broker who will help you access the international stock market and open an investment account
• After the account is opened, deposit the funds needed to buy shares
• Then, search for and select Amazon shares with the ticker symbol “AMZN” on the trading platform you use
  Finally, determine the number of shares you want to buy, then make a transaction according to the current market price

Furthermore, make sure that you have met the requirements set by the broker, including identity verification and financial documentation.

Risks and Considerations in Investing in Amazon Stocks

Although Amazon stocks offer the potential for great profits, there are a number of risks that need to be considered before investing. Here are some of the risks and considerations that you need to know.

 

Market Fluctuations

Amazon’s stock price can be affected by market fluctuations triggered by changes in interest rates, inflation, and global market sentiment. Changes in these economic conditions can cause significant stock price volatility.

Regulation and Competition

Amazon faces challenges from anti-monopoly regulations imposed by governments in various countries.

In addition, intense competition in the technology sector, especially from big players such as Alibaba and Walmart, could affect Amazon’s market position.

Amazon-Specific Risks

Amazon is highly dependent on the success of Amazon Web Services (AWS) to drive revenue growth. This dependence poses risks if AWS’s performance does not meet expectations.

In addition, criticism regarding the company’s working conditions and operations could also affect Amazon’s reputation and performance in the market.

 

Conclusion

So, that was an interesting discussion about Amazon Stock: Blue-Chip with Unlimited Potential that you can read in full at the Crypto Academy at INDODAX Academy.

In conclusion, Amazon stock shows solid financial performance with bright long-term prospects, driven by continuous innovation and dominance in the e-commerce and cloud computing sectors.

On the other hand, AWS plays a very important role in driving revenue growth, while a growth strategy focused on operational efficiency and global expansion also further strengthens Amazon’s position in the market.

It should also be noted that INDODAX will soon introduce a new investment option that allows its users to invest in stocks listed in the United States (US).

With this feature, you can expand your investment portfolio not only with crypto assets, but also more than 50 US stocks, all of which can be managed in one integrated account on the INDODAX platform.

 

FAQ

1. What is Amazon stock?
Amazon stock is a small ownership of Amazon.com Inc., which is traded on the NASDAQ exchange under the symbol “AMZN”. This stock reflects Amazon’s business performance in various sectors such as e-commerce, AWS, and digital entertainment.

2. Why are Amazon stocks considered attractive for investment?
Amazon stocks have strong growth prospects due to its business diversification, dominance in the e-commerce sector, and continuous innovation through AWS. In addition, the company has shown stable and increasing financial performance.

3. How to buy Amazon stocks?
You can buy Amazon stocks directly on the NASDAQ exchange through international brokers,

4. What are the main risks in investing in Amazon stocks?
The main risks include stock price fluctuations due to changes in the global market, intense competition from other companies, and the potential impact of anti-monopoly regulations. Reliance on AWS is also a challenge for revenue growth.

5. How much does AWS contribute to Amazon’s revenue?
AWS contributes a significant portion of Amazon’s operating profit, with revenue of $7,000,000,000 in Q3 2023. This makes it one of the main pillars of the company’s business growth.