“Buy and don’t look back,” says top investor about Amazon shares

Amazon (NASDAQ:AMZN) is one of the most influential and well-known companies in the world, having revolutionized both the e-commerce and cloud computing industries. However, the company now faces the challenge of surpassing the unprecedented growth it experienced at the height of the Covid-19 pandemic.

In the second quarter of 2024, for example, revenue rose 10% to $148 billion – a significant slowdown from the over 40% growth in 2020 and 2021, not to mention below Wall Street estimates.

Despite the slowdown, a high-profile investor named Kody's Dividends believes Amazon's growth story is far from over.

“Amazon is a company that is doing exceptionally well. Every aspect of the company showed healthy growth in the second quarter,” writes Kody, who is in the top 1% of all stock pros on TipRanks.

“Amazon's focus on providing customers with the best price, selection and convenience continued to pay off, resulting in higher unit sales, advertising revenue and subscription service revenue during the quarter,” the investor added.

In addition, Kody emphasizes that Amazon has several growth drivers in sight. Its dominance in e-commerce continues to grow worldwide and Amazon is capturing a growing share of total sales.

Amazon Web Services (AWS) is also proving to be a key growth driver. “As the world leader in cloud computing, AWS is the most obvious beneficiary” of global IT spending, Kody notes.

From Kody's perspective, these strong fundamentals make Amazon an attractive buying opportunity, especially given that the investor believes shares are trading 40 percent below fair value (based on price-operating cash flow).

Assuming the investor's calculations are correct and Amazon delivers on its growth consensus, the internet giant can “expect a staggering 114% upside potential” by the end of 2026. Currently, Kody rates AMZN stock as a “strong buy.” (To watch Kody's Dividends track record, click here)

Wall Street analysts agree with this optimistic sentiment. TipRanks data shows that Amazon is a strong buy. The stock's consensus price target of $222.88 implies a return potential of 19%. (See AMZN Stock Forecast)

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Disclaimer: The opinions expressed in this article are solely those of the featured investor. The content is intended to be used for informational purposes only. It is very important that you do your own analysis before investing.