AMAZON STOCK MARKET VALUE ON VERGE OF ECLIPSING MICROSOFT
Amazon’s stock was up 3.7 percent at
$1,441 per share in afternoon trade, on track for a record high close and
putting its market capitalization at $701 billion. The stock traded as high as
$1,498.
15-year chart for Amazon. The stock is up 50X from $28 to $1,400. Up until a few years ago, analysts said #Amazon was worthless because they were losing $$$ on every book they sold. Today it is worth $700 bln. There is a chance the $BTC chart will look like this in 15 years. pic.twitter.com/d0RjaW0gID— Ronnie Moas (@RonnieMoas) February 4, 2018
Microsoft fell 2.2 percent to $92.97,
trimming its market capitalization to about $711 billion.
Apple Inc, the world’s most valuable
listed company, was worth $827 billion on Friday after reporting disappointing
iPhone sales on Thursday. Its stock fell 3.7 percent to $161.57.
The major stock indexes fell as much
as 2.1 percent in a broad retreat.
At least 13 brokerages raised their
price targets for Amazon after it posted record profits, pointing to growth
potential from increasing global Prime subscriptions and a market-leading cloud
business.
Analysts at Jefferies, Wedbush and
Credit Suisse were the most bullish, boosting their targets to $1,750. At that
price, Amazon would be worth about $850 billion.
Microsoft’s stock has jumped 150
percent to new highs since Chief Executive Officer Satya Nadella took over in
2014 and made the company a major player in cloud computing while reducing its
dependence on a tepid personal computer industry.
But Microsoft has failed to keep up
with Amazon shares, which have surged 73 percent in the past 12 months.
Amazon revenue has been growing at a
scorching pace as more shopping moves online and businesses shift their
computing operations to the cloud, where Amazon Web Services (AWS) leads the
market.
AWS, which competes with Microsoft’s
Azure and Alphabet Inc’s Google Cloud platform, reported a 45 percent jump in
revenue to $5.1 billion in the quarter.
“AWS is still adding more incremental
dollars than all public cloud competitors combined,” Barclays analyst Ross
Sandler said.
The high-margin business, which accounts
for a significant chunk of Amazon’s operating profit, has been providing cash
for investments and supporting the razor-thin margins in retail.
Amazon’s earlier investments in
warehouses have yielded results for the company as lower shipping costs boosted
its quarterly operating margin to 3.5 percent, its highest fourth-quarter
margin since 2010, analysts said.
Wall Street analysts are
overwhelmingly bullish on Amazon, with 46 of 50 brokerages rating it “buy” or
higher, three “hold” and only one “sell.” Their median price target is $1,580.
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