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Amazon (NASDAQ:AMZN) stock remains a top investment choice in 2024 despite its high valuation. With stiff competition in e-commerce and artificial intelligence, Amazon’s impressive earnings and long-term growth potential set it apart from the rest.
Recent cost-cutting measures have fueled significant growth over the past year, with projections showing earnings per share (EPS) to surge over 30% year-over-year in FY24. Amazon’s cloud arm, AWS, continues to lead the AI race, making it a compelling choice for investors looking for both a retail giant and a tech powerhouse.
Soaring Earnings and Profitability
Amazon’s cost-cutting efforts in 2023 have paid off, with the company’s earnings and free cash flow (FCF) seeing a substantial increase. In FY23, AMZN stock reported a net income of $30.4 billion or $2.90 per share, a significant improvement from a net loss of $2.7 billion in FY 2022. Additionally, Amazon achieved record FCF of $36.8 billion, driven by cost-cutting measures and investments in generative AI.
Analysts are optimistic about Amazon’s future, with current estimates projecting EPS to climb more than 30% in the 2024 fiscal year. This growth is supported by diversified revenue streams across all of Amazon’s businesses.
AWS Powered by Artificial Intelligence
Amazon Web Services (AWS) is expected to be a key driver of growth for Amazon, dominating the cloud infrastructure market and leading the way in artificial intelligence. With investments in AI infrastructure like Amazon Bedrock and custom-designed chips, AWS is well-positioned to meet the demands of the AI enterprise software market, which is forecasted to grow rapidly in the coming years.
AMZN Stock: Continued Dominance in E-Commerce and Beyond
Despite facing competition, Amazon remains the leader in e-commerce, offering fast delivery and expanding its offerings through Amazon Prime. The company has also made successful forays into healthcare and advertising, with its ad services business growing 27% year-over-year to $14.65 billion in Q4 2023.
Overall, Amazon’s strategic expansions and leadership in AI solidify its position as a global technology giant. As we move further into 2024, Amazon’s unstoppable ascent makes AMZN stock a must-buy for investors.
On the date of publication, Terel Miles did not have any positions in the securities mentioned in this article. The opinions expressed are those of the writer, subject to InvestorPlace.com Publishing Guidelines.
Terel Miles is a contributing writer at InvestorPlace.com, with over seven years of experience investing in the financial markets.
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