E-commerce pioneer Amazon (AMZN -0.22%) belongs in the small handful of stocks I'd consider buying at any time. At the same time, master investors like Warren Buffett insist that even great companies should be bought only at reasonable prices. As 2024 winds down, Amazon shares have gained more than 46% this year.
Even though it's already made millionaires, this company still has incredible growth prospects. It may not be the same as a young upstart, but it also comes with less risk. Amazon stock should amply reward investors over the next five years.
Did you know that a $1,000 investment in Amazon's IPO in 1997 would be worth $1.87 million today? That's a staggering return of over 186,900% 🚀 ✨ But it wasn't all smooth sailing. Investors had to endure a 95% drop during the dot-com bust, waiting until 2009 to recover.
Сan Amazon reach $1000 again? Some bullish forecasts suggest it could reach $800 or even $1,000, reflecting a highly optimistic outlook. However, this figure is subject to numerous market conditions and the company's performance over the coming years.
Amazon shies off high after hitting $2,000 per share for the first time. It's a major milestone in the stock's climb to match Apple's $1 trillion market valuation.
Amazon (AMZN) does not pay a dividend.
AMZN Stock 12 Month Forecast
Based on 48 Wall Street analysts offering 12 month price targets for Amazon.Com, Inc. in the last 3 months. The average price target is $249.16 with a high forecast of $290.00 and a low forecast of $197.00.
Over four years, Amazon employees receive shares according to this schedule: Year 1: 5% of RSUs vest at the end of the first year. Year 2: 15% of RSUs vest at the end of the second year. Year 3: 40% of RSUs vest at the end of the third year.
If you are a long-term investor, it is still not too late to buy Amazon stock, given the many growth levers that the company has. For instance, its digital advertising business has a decent growth runway as it ramps up ads on Prime.
We continue to see Apple as overvalued, as we believe there are growth headwinds to iPhone revenue in a mature smartphone market and with higher competition out of China. We expect iPhone revenue to return to growth in fiscal 2025 after a couple of weak years of growth.
Those gains translate to a 25.8% compound annual growth rate for Amazon compared to an 8.2% CAGR for the S&P 500 in that time. As a result, $10,000 in AMZN stock purchased 20 years ago would now be worth $983,555.
Analysts See 13% Upside For Amazon Stock
The 30-year-old Amazon is among the world's most valuable companies. It is a leader in e-commerce spending and in cloud computing through its Amazon Web Services business. It is also quickly growing its advertising business into a challenger to Google (GOOGL) and Meta (META).
Amazon stock had a strong 2024 and has analysts bullish for 2025. But Amazon is among AI stocks facing a "tricky path" overall.
As the Amazon marketplace grows increasingly competitive so are many Millionaires made.
The Future of Amazon
Forecasters predict that Amazon will reach $200 per share a year from now and will continue to rise to $250 per share at the end of 2026. In 2027, the prediction is for a price of $300, and $250 by the end of 2028.
Apple. Apple (NASDAQ: AAPL) has ranked as the largest holding in Buffett's Berkshire Hathaway portfolio for several years. The iPhone maker is still at the top early in the new year. Berkshire owns 300 million shares of Apple worth around $73.2 billion, representing 24.8% of its total holdings.