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Amazon (AMZN) Staring at Life Time Highs after a Knockout Holiday Quarter

E-commerce giant Amazon (NASDAQ: AMZN) is still one of the darling stocks of investors looking for long term value generation. Closed at $2,150.80, the company is merely inches away from its 52-week high of $2,185.95.

On February 11, 2020, Amazon stock closing price was at an all-time high. However, the Amazon 52-week high stock price is 2185.95, which is 1.6% above current share price.

The Amazon stock has been in a whirlwind in the past one year, hitting lows at $1,586. In 2020, the stock went down to $1,838.24 on January 27 but recovered quickly from the slump.

Experts are confident that despite some hiccups, Amazon is a strong company and still has room to grow. In the past three months alone, the stock has risen 21.7%.

With a fourth straight record close day and a 5.7% rise in price during the increase, a strong e-commerce and cloud computing business, a $1.07 trillion valuation seems good. With a strong holiday quarter report, the company is the third most valuable company in the US behind Microsoft and Apple and just a step ahead of Google.

Moving beyond its own expectations

The holiday quarter brought $3.3 billion in profits for the company, translating to $6.47 per share. Its quarterly sales hit a new record at $87.4 billion. Last year, the company’s holiday quarter sales were $72.38 billion with a profit of $6.04 per share. The company beat analyst expectations by a solid margin, who expected $86.03 billion in revenue and $4.04 profits per share.

Amazon forecasted a grim holiday season owning to its investments and a short holiday season. It expected net revenue of $80 billion to $86.5 billion. Analysts were expecting $87.39 billion in revenue.

Jeff Bezos sold Amazon stock

It would be troublesome to find the founder and CEO of a company sell $4.1 billion worth of stock in just 11 days. Filings with the Securities and Exchange Commission show that Jeff Bezos has sold the company’s stock.

This selling is a part of a pre-arranged 10b5-1 trading plan. Bezos had previously announced that he would sell stock worth $1 billion each year to fund Blue Origins, his space exploration company. Overall, Bezos’ stock sale doesn’t ring any bells for the company.

The Amazon stock price projection for the next 12 months. Data:

Considering Amazon’s market leader status in e-commerce, its foray into groceries, its Prime range of services and its valuable cloud business, Amazon is still a good buy. Analysts expect an EPS of $26.83 in 2020, up from $22.99 in 2019.

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