Facebook
Twitter
Amazon (NASDAQ: AMZN).
It’s the world’s 4th largest company by market cap. And by next year it’ll surpass Walmart (NYSE: WMT) in terms of annual sales.
Shares have surged from its $1.50 IPO price to $3,130 today.
That’s a 20,587% return – turning just $500 into over $1 million.
Yet Amazon’s biggest gains are now in the rear-view mirror.
Go here for my #1 trade of 2022 – it’s NOT Amazon or any other “FANG stock.”
Amazon Owns Shocking 40% of E-Commerce
Amazon started as an online bookseller and has morphed into an e-commerce giant.
Today Amazon has more than a 40% market share in U.S. e-commerce. The #2 player is Walmart – with a 6% market share.
However, Amazon’s core e-commerce business is unprofitable. The company regularly sells products at prices that undercut competitors – both online and in retail.
Additionally, Amazon is spending huge amounts to build out its logistics and delivery operations. You can see this in the company’s capital expenditures – also known as “CapEx.”
CapEx jumped over 50% last year – topping $60 billion.
This includes buying airplanes, delivery trucks and vans. And opening more delivery centers. The goal is to provider faster delivery times for customers – without being dependent upon FedEx (NYSE: FDX), UPS (NYSE: UPS) or the U.S. Postal Service.
Chairman Jeff Bezos never focused on running a profitable company. Instead, he was always willing to reinvest the cash flow to build a better, bigger, stronger and more resilient business.
Historically – investors haven’t seemed to really care. Bezos prepped investors back in the 90’s when he came up with a simple mantra for the company: “Get big fast.”
But here’s the thing…
Amazon has one aspect of its business that is VERY profitable and very valuable. And it’s invisible to most folks.
$1 Trillion Cloud Company – Hidden Inside Amazon
In 2006 Amazon launched a division named Amazon Web Services – or AWS.
Basically, the company decided to rent out its web servers to other companies. This allowed Amazon to leverage its technology investment – and have other companies offset the cost.
Today we call this cloud computing.
AWS generated $18 billion in revenues and $5.3 billion in operating income last quarter. And it’s growing at an impressive 40% per year!
Today AWS is worth at least 10-times sales – or around $710 billion.
This means roughly one-half of Amazon’s market value is connected to AWS.
Given the rapid growth – AWS could be worth over $1 trillion within the next year.
Read Daily Profit tomorrow morning for my outlook and price target on Amazon.
One thing is clear: the biggest profits from the FANG stocks are a thing of the past.
That’s why I’m focused on uncovering the next generation tech stock winners. And buying these stocks could be like jumping into Apple, Google, or Netflix 10+ years ago.
They’re called MACE stocks.
Access my urgent LIVE webinar to discover:
- What exactly are MACE stocks – and why you have not heard of them
- When these MACE stocks could become household names
- Details on 5 of these next generation tech stocks
- How these stocks could crush FANG stocks in the next 3 years
- Why I’m planning to bet $100,000 of my personal savings on these stocks
Simply go here for urgent details.
Yours in Wealth,
Ian Wyatt
Full Disclosure: Ian Wyatt owns shares of Facebook, Amazon, Apple, Netflix and Google.