5 Reasons Why Amazon Will Remain a Good Investment In 2023

TL;DR

Amazon continues to be a strong investment choice due to its resilience during the pandemic, significant market position, and ongoing growth in various sectors.

Key Takeaways

Amazon's valuation exceeds $1 trillion.
The company announced a 20-for-1 stock split, making shares more accessible.
Jeff Bezos's leadership has been pivotal in Amazon's success.
E-commerce sales are on the rise, benefiting Amazon's business model.
Amazon Prime membership is growing rapidly, leading to increased spending.

Investing in Amazon is often viewed as investing in one of the world's most successful businessmen, Jeff Bezos. His entrepreneurial skills have positioned Amazon as a leading company since its inception in 1994. Bezos's significant ownership stake in the company motivates him to enhance its value over time.

Growth of Online Shopping

The global shift towards online shopping continues to benefit Amazon. E-commerce sales accounted for 14.1% of all retail sales worldwide in 2019, with projections indicating growth to 22% by 2022.

Amazon's Diverse Business Model

Amazon is not just an e-commerce platform. The company is expanding into smart-home technology with Alexa and healthcare services through PillPack. Additionally, advertising revenue in its e-commerce sector is increasing.

Shift from Brick-and-Mortar to Online Sales

Americans are increasingly shopping online, with e-commerce sales making up 11.4% of U.S. retail sales in Q4 2019. This trend indicates significant growth potential for Amazon.

Amazon Prime Membership Growth

Amazon Prime membership is expanding, with over 150 million members worldwide as of January. Prime members tend to spend significantly more than non-members, which is beneficial for Amazon's revenue.

Conclusion

A majority of financial analysts recommend buying Amazon stock, indicating confidence in its growth potential. With a strong market position and ongoing expansion, Amazon remains a compelling investment choice.

Sources: Amazon Investor Relations · Amazon stock split announcement · Amazon Form 10-K filings