Amazon has always been the darling of the United States financial market, especially in the past year or more Amazon has maintained a profitable situation, its market value is almost a record every day.
In recent days, Amazon’s share price has been climbing upwards. On the morning of Thursday morning in New York City, its share price broke the $800/share mark for the first time, reaching US$804.70, with a gain of 1.89% in one day. Amazon CEO Jeff Bae The net assets of Jeff Bezos rose by about one billion U.S. dollars in one day. At the same time, the company's market value soared to 382 billion US dollars, second only to Apple, Google Alphabet, and Microsoft's three giants, continue to rank fourth.
According to analysts’ predictions, Amazon’s share price will continue to set records in the coming days. Argus analyst Jim Kelleher said: "Although Amazon's growth engine is unparalleled, it is difficult to estimate Amazonian stocks from a valuation point of view. Based on past comparable analysis, and discounted on the free cash flow value. We think Amazon's growth prospects are faster than the stock price, so this is a favorable entry point."
Although Amazon was listed as early as 1997, and its share price has increased by more than 700 times since then, industry insiders still say that the giants of home appliances are still out of the early stages of growth. As early as May of this year, Bernstein Research analyst Carlos Kirjner adjusted Amazon's one-year target price from $770 to $1,000. "We think that Amazon's business is now so huge, and it is growing rapidly and profitably, which makes it increasingly difficult for the company to find new areas of investment, so as to keep pace with the growth of total profits, which relates to the increase in profitability." Corna That is to say.
And JP Morgan analyst Douglas Anmuth's target price for Amazon is expected to be 915 US dollars.
Analysts remain optimistic about the prospects of Amazon, mainly from the growth trend of Amazon's core business.
Bezos: Amazon has three major business foundationsAs we all know, in the letter to shareholders issued by Bezos in April of this year, Amazon’s three pillars have been highlighted: AWS (cloud service), Marketplace (third-party e-commerce platform) and Prime (multiple value-added services), etc. And these three businesses have never let Amazon down in the past year.
According to Amazon's second-quarter earnings report for fiscal year 2016, Amazon’s net revenue in the second quarter reached US$30.4 billion, a year-on-year increase of 31%, which exceeded the analyst’s previous estimate of US$29.54 billion; net profit was US$857 million, a year-on-year increase. Increase 832%.
Among them, cloud service revenue increased by 58% over the same period of last year. In the first half of the year, Amazon’s revenue from cloud services exceeded US$5 billion. In addition, the operating margin of cloud services also reached 25%, which is the profit of Amazon’s businesses. The highest rate. According to industry sources, the strong performance of cloud services is the most important reason for the continuous growth of Amazon's stock price. If there is no accident, this business will complete Besos's ten billion dollar revenue target this year.
The growth of another major source of growth, the e-commerce business, exceeded the expectations of analysts. In the second quarter of this year, the e-commerce business and international e-commerce business in North America performed well, with growth rates of 28% and 30%.
In addition, Amazon also passed its Prime Member derivative service, which also brought significant business growth to Amazon. It is understood that Amazon has about 60 million Prime members in the United States. Prime Member Services currently covers 11 countries. What does this 60 million Prime membership mean?
Previously, a research institute conducted a survey and the results showed that Prime members' shopping on the Amazon platform was approximately twice as much as non-members.
Next Growth Point: The Fourth Pillar BusinessOf course, Amazon is also seeking a fourth-tier pillar business with the above three major business levels. Bezos also said to all Amazon shareholders, "Although I will focus on the above three businesses, but I also assure you that we are still trying to find the fourth pillar business."
It is clear that Bezos believes that Amazon has a good control of the current situation. The next goal is to find new business growth points. As for what is the fourth pillar of the business, he has not announced it to the public. However, the industry is still optimistic about the arrival of Bezos's fourth-largest business. The industry believes that Amazon's voice-controlled speaker Echo and video streaming services may play an important role in the future.
Based on the steady growth of the three major businesses and the imagination of the fourth pillar business in the future, Amazon's share price will continue to show an upward trend in the coming months, and the industry will not be surprised.
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