This disruptive technology business has a strong position in multiple end markets.
Amazon (AMZN 0.02%) started out as an online bookseller. But these days, it has evolved into a thriving tech titan with a presence in many industries. The business is massive, sporting a market cap of $2.4 trillion.
The stock’s long-term returns are magnificent. But they’re not as impressive on a shorter time frame. If you bought $100 worth of Amazon shares five years ago, here’s how much you’d have today.
Image source: Amazon.
Amazon lags the S&P 500
In the past five years, this stock has generated a return of only 43% (as of Nov. 19). This means that a $100 investment would be worth $143 today.
This gain pales in comparison to the 100% total return of the S&P 500 index. It’s worth pointing out, though, that Amazon shares skyrocketed 77% in the 12 months before (from mid-November 2019 to mid-November 2020), as it benefited from a quick recovery following the COVID-19 dip.
Nonetheless, it might be surprising to see the stock underperforming the broader index on a trailing-five-year basis.
Today’s Change
(-0.02%) $-0.05
Current Price
$229.62
Key Data Points
Market Cap
$2455B
Day’s Range
$228.78 – $231.74
52wk Range
$161.38 – $258.60
Volume
926K
Avg Vol
48M
Gross Margin
50.05%
Dividend Yield
N/A
Should you buy Amazon stock?
Amazon looks to continue its winning ways. Its revenue keeps growing, with net income rising at a much faster clip in the third quarter (ended Sept. 30). It’s a leader when it comes to artificial intelligence. And the business possesses numerous durable competitive advantages that support its dominant position.
Investors should consider buying the stock right now.
Neil Patel has no position in any of the stocks mentioned. The Motley Fool has positions in and recommends Amazon. The Motley Fool has a disclosure policy.