Shares of Amazon (NASDAQ:AMZN) extended its correction from the record highs above $3 550, registered in the first week of September. Despite this, there is no reason to panic and as long the price of Amazon stock is above $3 000 this stock is in the “BUY” zone.
Fundamental Analysis: Business continues to grow rapidly
This stock has been one of the market’s biggest winners in the last several months. The price of Amazon stock has advanced from $1 900 above $3 500 in less than six months and the current price stands around $3 116. Amazon’s business continues to grow rapidly and the company become a supply channel for many consumers in the age of COVID-19 pandemic.
Amazon continues with expanding its Go Grocery concept and the company opened another Amazon Go Grocery store in the Seattle area. With this concept, customers are able to shop without stopping at a checkout stand by scanning an app on their phone as they enter. Another positive news is that Amazon is preparing to launch a new online platform for luxury fashion brands. The company is going to spend around $100 million on a marketing campaign which will certainly add new customers and increase revenues of Amazon.
The company is in a good position to grow both its retail business and its AWS cloud services segment. The revenues could easily grow 30% this year but everyone is wondering if Amazon stock is still “buy”? At its current share price, Amazon could be a very good short-term investment with solid growth prospects. I said short- term investment because with $1.56T market capitalization this stock is overvalued in my opinion and represents opportunity only for short-term traders. Profitability ratios also confirm
