Out of all of the good stories in the stock market, the continued rise of Amazon (NASDAQ: AMZN) is one that no investor can ignore.
2018 has been a year of high volatility in the stock market. Even as the market now shows signs of smoothing, there are plenty of cautious investors who are holding off on new purchases as we move deeper into the second quarter of the year. For all of the losses that the market has suffered this year, there are still plenty of companies that have been performing well. The tech industry has been particularly resilient, and even the energy sector is now making good gains after a dismal 2017 and start to 2018.
Now the Second Most Valuable Publicly Traded Company
Amazon falls only behind Apple in terms of total value. It has overtaken both Microsoft and Google on its way to the second spot.
In the pre-market today, it was priced at more than $1560 per share. This means that investment in Amazon is not cheap, but the returns can be worth it. For such a high value stock, it might initially be surprising that the majority of analysts rank it as a ‘BUY’. However, when you look at recent performance, it’s not difficult to see why industry insiders and experienced investors believe that it still has plenty of room to grow.
Amazon stock value has grown 33.13% this year (as of April 20). While it has finished some days down on the previous numbers, the stock has always managed to regain, and investors who have patience to ride these waves are still running at a profit. If we look back over a full 12 months, the stock has grown 73.27%, a figure that is more than three times the market average growth.
Whatever you think about the stock market and whether it has hit its current peak, Amazon continues to break the ceiling.
What Gives Investors Confidence in This Stock?
It is a diversified company. Although the primary business is online retail, the company now has an interest in physical retail, cloud technologies through Amazon AWS, and in eBook publishing and digital content distribution. Amazon also has an in-house production business for direct-to-platform television series and films.
Recently it has unveiled new services that will make online retail smoother for international customers. They have also announced the sign-up of their 100 millionth Amazon Prime customer (a subscription based premium shopping service).
In short, the company is doing everything that it needs to grow, and profits are soaring. Investors recognize this and stock is in high demand.
Should You Buy Amazon Stock Today?
Amazon represents a strong investment and the majority of analysts believe this stock should still be purchased. Growth will continue because demand is high and because the company performs financially at a high level. It has global reach and has not fully exploited the markets that are available.
Despite being a pricey investment, buying Amazon stock is not a bad idea. Within a diversified investment portfolio with stock spread across different sectors, this stock makes a lot of sense and would be a strong asset for any investor in 2018.
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