The company's stock has skyrocketed over the last decade but remains an exciting investment for the next 10 years.
Amazon's (AMZN 1.34%) business exploded over the last decade, with its share price up nearly 990%.
The company has become a tech behemoth and a household name worldwide. It has dominated e-commerce with its retail site, achieved a leading market share in cloud computing with Amazon Web Services (AWS), expanded its artificial intelligence (AI), and even dabbled in video games, grocery, and space satellites.
Data by YCharts
As a result, an investment of $10,000 a decade ago would be worth over $107,000 today. The company made many millionaires over the last decade, begging the question: Does it still have much to offer new investors?
Let's examine Amazon's business more closely and determine whether it's still worth investing in in 2024.
Beating analysts' expectations for four consecutive quarters
Like many companies, Amazon hit a rough patch in 2022. Macroeconomic headwinds plagued the tech world and saw Amazon's stock plunge 50% through the year. Spikes in inflation curbed consumer spending and caused a steep decline in Amazon's retail profits.
However, the company's business made an impressive turnaround since then. A slew of cost-cutting measures and easing inflation put Amazon on a solid growth path that has shown no signs of slowing.
| Quarter | Earnings Per Share | Revenue |
|---|
| December 2023 (Q4) | Beat 24.4% | Beat 2.2% |
| September 2023 (Q3) | Beat 58.7% | Beat 1.1% |
| June 2023 (Q2) | Beat 89.6% | Beat 2.3% |
| March 2023 (Q1) | Beat 44.3% | Beat 2.2% |
Amazon's earnings beat Wall Street forecasts for four consecutive quarters, benefiting from a strong comeback in its retail segments and cloud growth. In the fourth quarter of 2023, total revenue rose 14% year over year to $170 billion. Meanwhile, operating income hit $13 billion, a significant improvement from the $3 billion it posted the year before.
Amazon's next earnings release is scheduled for April 30, with many analysts predicting positive results. Improvements in retail are likely to continue alongside AI-driven growth from AWS and increased advertising earnings. As a result, it could be a smart move to make a long-term investment in Amazon's stock now ahead of its next quarterly earnings release.
Amazon has growth catalysts scattered throughout tech
One of the best reasons to invest in Amazon is its deep economic moat. For those unfamiliar with this term, "economic moat" is often used to describe a company's ability to maintain a competitive advantage over its rivals and retain its market share.
Amazon built up its moat in multiple industries. The company holds a 38% market share in e-commerce in the U.S., compared to Walmart's second-largest market share of just 6%. Meanwhile, Amazon has achieved a leading 31% market share in cloud computing, outperforming rivals Microsoft Azure and Alphabet's Google Cloud.
Amazon's wide reach is especially promising for its gradual expansion into the $200 billion AI industry. The company is using its supremacy in the cloud market to get ahead of its rivals in AI.
Last year, Amazon responded to increased interest in AI by expanding its library of AI services on AWS. The company debuted Bedrock, a tool that helps clients build generative AI applications, and Codewhisperer, which makes developers' lives easier by accurately generating code.
Over the last 10 years, Amazon's annual revenue rose 546%, while operating income skyrocketed over 20,000%. In fact, in the last year alone, its free cash climbed 904% to $32 billion.
The company is one of the biggest names in the high-growth tech market, with vast financial resources to continue investing in its business and keep up with its competitors.
Data by YCharts
Moreover, Amazon is one of the best bargains in tech, with the lowest price-to-sales ratio (P/S) among some of its rivals. P/S is calculated by dividing a company's market cap by its trailing 12-month revenue. As a result, the lower the metric, the better the value. Amazon's stock is potentially trading at a far better value than its peers', including Apple, Microsoft, Alphabet, and Meta Platforms.
Amazon's significantly lower P/S, alongside its potent position in tech, make its stock a screaming buy right now. The company is on a promising growth path you won't want to miss out on.
Randi Zuckerberg, a former director of market development and spokeswoman for Facebook and sister to Meta Platforms CEO Mark Zuckerberg, is a member of The Motley Fool's board of directors. Suzanne Frey, an executive at Alphabet, is a member of The Motley Fool’s board of directors. John Mackey, former CEO of Whole Foods Market, an Amazon subsidiary, is a member of The Motley Fool’s board of directors. Dani Cook has no position in any of the stocks mentioned. The Motley Fool has positions in and recommends Alphabet, Amazon, Apple, Meta Platforms, Microsoft, and Walmart. The Motley Fool recommends the following options: long January 2026 $395 calls on Microsoft and short January 2026 $405 calls on Microsoft. The Motley Fool has a disclosure policy.
FAQs
If you'd bought $10,000 worth of Amazon stock 10 years ago, today your investment would be worth more than $114,690. With that, Amazon proves it's made a great long-term holding. But now the question is whether that's still the case.
What if you bought Amazon stock 10 years ago? ›
Over the last decade, Amazon's shares have appreciated 945%. That easily bested the S&P 500's 227% total return. Even starting with a relatively small $1,000 just 10 years ago, you would now have about $10,500.
How much was Amazon stock worth 20 years ago? ›
If You Bought Amazon Stock 20 Years Ago
The company's stock traded around $2 per share 20 years ago. If you had invested $1,000, you could have bought 500 shares of Amazon stock. Shares are currently trading at $187.88, meaning your investment's value could have soared to $93,940.
What is the 10 year return on Amazon stock? ›
Ten Year Stock Price Total Return for Amazon.com is calculated as follows: Last Close Price [ 171.39 ] / Adj Prior Close Price [ 17.12 ] (-) 1 (=) Total Return [ 901.3% ] Prior price dividend adjustment factor is 1.00.
What if I invested $1,000 in Amazon in 1997? ›
That's right, a mere $1,000 outlay in 1997 would yield investors nearly $2.5 million today (and a hefty tax bill from Uncle Sam).
How much is $10,000 invested in Amazon 10 years ago? ›
If you'd bought $10,000 worth of Amazon stock 10 years ago, today your investment would be worth more than $114,690. With that, Amazon proves it's made a great long-term holding.
How much is $10,000 in Apple 20 years ago? ›
The Numbers on Apple Stock
Those gains translate to a 36.2% compound annual growth rate (CAGR) for Apple compared to an 8.5% CAGR for the S&P 500 in that time. That means that $10,000 in AAPL stock purchased 20 years ago would be worth more than $4.85 million today, assuming reinvested dividends.
What will $10,000 be worth in 20 years? ›
The table below shows the present value (PV) of $10,000 in 20 years for interest rates from 2% to 30%. As you will see, the future value of $10,000 over 20 years can range from $14,859.47 to $1,900,496.38.
What if you invested $1000 in Google 20 years ago? ›
Monday marked the 20-year anniversary of Google's IPO. The stock has appreciated over 6,500% since then. In other words, if you invested $1,000 in Google at its closing price on Aug. 19, 2004, your shares of Alphabet, now the search giant's parent, would have been worth $66,521.70 as of Monday's close.
What will Amazon be worth in 2030? ›
Summary. Amazon's future growth potential is often underestimated due to its size, but its unique position in leading growth industries sets it apart. Amazon's online store, 3P sales, advertising, subscriptions, and AWS segments all contribute to its potential $4 trillion valuation by 2030.
Of the 47 analysts who recommended Amazon in June, 44 rated it a buy or a strong buy. Forecasters predict that Amazon will reach $200 per share a year from now and will continue to rise to $250 per share at the end of 2026. In 2027, the prediction is for a price of $300, and $250 by the end of 2028.
What year was Amazon stock the highest? ›
The latest closing stock price for Amazon as of September 09, 2024 is 175.40. The all-time high Amazon stock closing price was 200.00 on July 02, 2024.
What is a good 10 year return on stocks? ›
5-year, 10-year, 20-year, 30-year Average S&P 500 Returns
| Period | Average stock market return | Average stock market return adjusted for inflation |
|---|
| 5 years (2018 to 2023) | 11.33% | 7.28% |
| 10 years (2013 to 2023) | 12.39% | 9.48% |
| 20 years (2003 to 2023) | 9.75% | 7.03% |
| 30 years (1993 to 2023) | 9.90% | 7.22% |
Currently, Amazon.com has a market capitalization of $1.74 trillion. Buying $100 In AMZN: If an investor had bought $100 of AMZN stock 10 years ago, it would be worth $1,038.46 today based on a price of $166.10 for AMZN at the time of writing.
Was Amazon stock ever $3000 a share? ›
Key Points. Amazon has soared more than 1,000% over the past decade, and the stock climbed past $3,000 prior to its last stock split. The company generates billions of dollars in earnings, thanks to its leadership in e-commerce and cloud services.
Has Amazon stock ever been $2,000? ›
Amazon shies off high after hitting $2,000 per share for the first time. It's a major milestone in the stock's climb to match Apple's $1 trillion market valuation. The record high comes a day after Amazon gained 3.2 percent, sparked by a bullish call by Morgan Stanley.
Is Amazon a good stock to hold forever? ›
Amazon stock for the long run
After all, anyone who put $1,000 into Amazon stock 20 years ago has enjoyed truly market-crushing returns. For its entire life as a publicly traded company, AMZN has generated an annualized total return of more than 32%.
When was Amazon $1,000 a share? ›
(AMZN) hit the magic price of $1,000 per share on the morning of May 30, but there's no indication that CEO Jeff Bezos has any intention of splitting the stock, the Wall Street Journal reports.
What will Amazon shares be worth in 5 years? ›
Of the 47 analysts who recommended Amazon in June, 44 rated it a buy or a strong buy. Forecasters predict that Amazon will reach $200 per share a year from now and will continue to rise to $250 per share at the end of 2026. In 2027, the prediction is for a price of $300, and $250 by the end of 2028.
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