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Amazon - AI Stock Analysis

Analysis generated November 5, 2024

Amazon.com, Inc. (NASDAQ: AMZN) is one of the largest and most well-known e-commerce platforms globally. Founded by Jeff Bezos in 1994, the company has grown substantially to not only include e-commerce but also cloud computing through Amazon Web Services (AWS), digital streaming, and artificial intelligence products. The company's diverse portfolio positions it uniquely in the market with multiple income streams.

Fundamental Analysis

Amazon’s financial health shows positive signs of growth. The revenue for the last quarter was $159 billion, marking a 7.48% increase compared to the previous quarter and an 11.75% increase compared to the same quarter last year. This indicates healthy year-over-year growth.

Net income for the last quarter was $15.3 billion, demonstrating a 13.67% growth over the previous quarter and an impressive 55.16% increase compared to the same quarter last year. This suggests that Amazon’s profitability is also on the rise.

EBITDA for the last quarter was $18.5 billion, which is an 18.12% increase from the previous quarter and a 27.87% increase year-over-year. This points to strong operational performance.

However, the current Price-to-Earnings (P/E) ratio stands at 42.38. This high P/E ratio might suggest that the stock is overvalued, indicating a potentially bearish outlook. Additionally, the recent insider selling of stocks could also be seen as a bearish signal, indicating that insiders might think the stock is overpriced.

Technical Analysis

The current stock price of Amazon stands at $198.94, reflecting a 6.66% increase from a month ago and a 42.36% increase from a year ago. These metrics indicate a positive short-term and long-term trend.

The Simple Moving Average (SMA) for the last 10 days (SMA10) is 193.47, slightly higher than the previous SMA10 of 192.36. This shows upward momentum in the stock price.

The Relative Strength Index (RSI) is 67.3, which falls into the neutral category, indicating that the stock isn't currently overbought or oversold.

Alternative Data Analysis

Regarding job postings and employee sentiment, Amazon has 19,543 open positions, an increase of 6% in the last couple of months. This suggests expansion and growth intentions.

For customer acquisition, Amazon boasts an estimated 2.82 billion visitors to their website with no significant increase or decrease recently. However, there is a noted decrease of 23% in daily app downloads, which could be a red flag indicating reduced customer engagement.

Looking at customer engagement, Amazon has 5.2 million Instagram followers, a 4% increase in recent months, showing increased public interest. Their Twitter account has 6 million followers, with stable numbers over the last couple of months.

According to AltIndex’s AI score, which integrates fundamental, technical, and alternative data, Amazon has a score of 53, suggesting a hold signal.

Conclusion

Amazon is demonstrating robust financial performance, with significant year-over-year growth across revenue, net income, and EBITDA. However, the high P/E ratio and insider selling suggest a cautious approach. The technical indicators show a bullish outlook, with upward trends in stock price and SMA10, although the neutral RSI indicates that we should watch for future changes.

Alternative data presents a mixed picture: while job postings and Instagram followers are rising, the drop in app downloads could signal engagement issues. Overall, with an AI score of 53 recommending a hold, a prudent investor might consider holding their Amazon shares at present, while closely monitoring future performance and market conditions.

Disclaimer: This AI stock analysis, generated by an experimental AI tool, is for informational purposes only and not financial advice. Information is based on publicly available data and may not always be accurate or current.