Why Amazon may create unique opportunities in 2021?
Ever wished you had bought something in the past that eventually went up significantly in value? Perhaps some land not in a very prestigious area at the time, which is now worth ten times more? Or maybe you wish you bought several stocks of an obscure start-up that later would turn into a multi-billion tech miracle.
Many financial analysts believe that Amazon has several opportunities to yield significant and consistent revenue growth and rising profit margins over the next few years. The e-commerce and cloud computing industries have started growing exponentially by the end of 2019. They have not yet reached even 5% of their potential, as more people around the world use smartphones, and make their purchases online instead of in-store. Amazon is considered to be one of the leaders in both industries, which is why top Wall Street analysts foresee a strong revenue growth for Amazon in the upcoming year.
Can Amazon reach $4,000 per share in 2021?
CNN Money gathered the opinions of 46 financial analysts on development prospects for Amazon. Many believe that, on average, the stock price will be up about 20% from the current one, amounting to $3,800. The boldest forecasts aim at $4,500 per stock by the end of 2021, or a %45 increase.
Over the course of ten years, Amazon value has multiplied 879,999 times. If you invested $500 at IPO price, that investment would be worth $1 million today. That’s an amazing return of about 36% compounded annually, or a total return of 113,000% on the money you invested.
Amazon is known for making bold moves and leaving competitors baffled when it quickly becomes the dominant player in every industry. Founded as a simple online bookstore in 1994, Amazon never seemed to rest on its laurels, and it eventually became the leading provider of e-commerce services. In 2010, Amazon was still referred to as just "one of the nation’s largest booksellers." Now, there is barely any facet of life that Amazon doesn’t touch: the grocery chain, cloud computing, health & pharmaceutical industries, and even online advertising.
The company sales had grown from $5 billion in 2003 to more than $280.5 billion in 2019 and had made its CEO and founder Jeff Bezos the single wealthiest person alive.
It’s too late to stop Amazon
A recent report by the Institute for Local Self-Reliance (ISLR) claims that roughly half of all U.S. households are subscribed to Amazon Prime, half of all online shopping searches start directly on Amazon, and Amazon captures nearly one in every two dollars that Americans spend online.
"As a retailer, its market power now rivals or exceeds that of Walmart, and it stands only to grow: by 2021, one-fifth of the U.S.’s $3.6 trillion retail market will have shifted online, and Amazon is on track to capture two-thirds of that share," according to ISL.
Amazon has a lot more to offer investors in 2021
Amazon’s primary business is its e-commerce segment. Most people don’t realize it, but up until just recently, Amazon had only taken a very small part of the global e-commerce trillion-dollar market, but in the past year, it had started rapid expansion into new countries. This move will provide the company with enough opportunities to drive its sales even higher, an investment that is forecasted to pay off in the upcoming 2021, and a reason for many people believing in such huge growth potential for Amazon in 2021. So, if you hate missing out on opportunities when they appear on your doorstep, maybe it’s time to have a closer look at Amazon and its market potential.
For those people who believe they have already “missed out” on the Amazon train and are afraid that they are joining too late – just have a look at the price movements from the last year. Add in the fact that 2020 was a pandemic year when many businesses struggled and see how almost any situation can bring opportunities.
So, what do you need to do if you want to invest a small amount in Amazon?
One share of Amazon stock costs more than $3,100, locking out less-wealthy investors. But there is a way that will allow you to enter the market with ten times less: the recent development of online trading platforms and investment instruments have created the ability to trade on price movements of such major share such as Amazon, Netflix or Disney, with a smaller investment compared to direct buy, and more importantly, with low fees.
The ability to invest just any amount in a share comes as the response to the growing amount of the new investment crowd, interested in the markets but lacking the huge capital needed to create share portfolios.
“We believe that participation is power. Since day one, we’ve focused on breaking down barriers like trade commissions and account minimums to help people participate in the financial system,” “One of our core values is participation is power,” says the CEO of a well known online trading platform. “Everything we do is rooted in this. We believe that this move has the potential to open up investing for even more people”.
Sources:
- CNBC If you invested in Amazon 10 years ago, here’s how much money you’d have now.
- CNBC Amazon Stock Rated As 'Best Idea' On Robust Growth Outlook.
- CNBC Buy Amazon Stock Because Its Business Model Is Unbeatable, City Says.
- Yahoo Amazon Has 'Best Ever' Holiday.
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