| Valuation method | Value, $ | Upside, % |
|---|---|---|
| Artificial intelligence (AI) | 91.60 | -60 |
| Intrinsic value (DCF) | 36.56 | -84 |
| Graham-Dodd Method | 53.39 | -77 |
| Graham Formula | 105.52 | -54 |
Amazon.com, Inc. (NASDAQ: AMZN) is a global leader in e-commerce, cloud computing, digital streaming, and artificial intelligence. Founded in 1994 and headquartered in Seattle, Washington, Amazon operates through three core segments: North America, International, and Amazon Web Services (AWS). The company dominates the online retail space, offering a vast selection of consumer goods, electronics, and digital content, while also providing third-party seller platforms. AWS is the world's leading cloud infrastructure provider, delivering scalable compute, storage, and AI solutions to enterprises. Amazon’s ecosystem includes Prime membership, Alexa-enabled devices, and original media content through Amazon Studios. With a market cap exceeding $2.1 trillion, Amazon remains a key player in both consumer discretionary and technology sectors, continuously innovating in logistics, automation, and AI-driven services.
Amazon presents a compelling investment opportunity due to its diversified revenue streams, leadership in e-commerce and cloud computing, and strong cash flow generation. AWS remains a high-margin growth driver, while retail operations benefit from scale and logistics efficiency. However, regulatory scrutiny, rising competition in cloud services, and macroeconomic pressures on consumer spending pose risks. The company’s heavy reinvestment in growth initiatives (e.g., AI, global expansion) may delay near-term profitability improvements. With a beta of 1.31, Amazon is more volatile than the broader market, but its long-term growth trajectory and innovation focus justify its premium valuation for growth-oriented investors.
Amazon’s competitive advantage stems from its unparalleled scale in e-commerce, driven by Prime membership loyalty, a vast fulfillment network, and data-driven personalization. AWS leads the cloud infrastructure market (33% share) with superior technology, global infrastructure, and enterprise trust. The company’s vertical integration—from logistics (Amazon Logistics) to devices (Echo, Ring)—creates a defensible ecosystem. However, competitors are eroding margins in retail (Walmart, Shopify) and cloud (Microsoft Azure, Google Cloud). Amazon’s cost leadership in delivery and cloud efficiency is offset by rising labor and regulatory costs. Its AI investments (e.g., Bedrock, Q) aim to solidify AWS’s edge, but Microsoft’s OpenAI partnership poses a threat. In advertising, Amazon leverages first-party shopping data to compete with Google and Meta, though it lacks their social media reach. Long-term risks include antitrust scrutiny and dependency on AWS for profitability.