{"id":4081,"date":"2023-05-04T08:38:33","date_gmt":"2023-05-04T12:38:33","guid":{"rendered":"https:\/\/ifintechworld.com\/markets\/amazon-stock-is-undervalued\/"},"modified":"2023-05-04T08:38:34","modified_gmt":"2023-05-04T12:38:34","slug":"amazon-stock-is-undervalued","status":"publish","type":"post","link":"https:\/\/ifintechworld.com\/?p=4081","title":{"rendered":"Amazon Stock Is Undervalued"},"content":{"rendered":"<div>\n<p>Amazon\u2019s stock (NASDAQ<fbs-ticker data-name=\"NDAQ\" data-href=\"https:\/\/www.forbes.com\/companies\/nasdaq\" data-type=\"stock\"><br \/>\n  NDAQ<br \/>\n <\/fbs-ticker>: AMZN) has gained roughly 23% YTD as compared to a 7% increase in the S&amp;P500 index over the same period. However, at its current price of $104, the stock is trading 21% below its fair value of $132 \u2013 Trefis\u2019 estimate for <strong data-ga-track=\"ExternalLink:https:\/\/www.trefis.com\/data\/companies\/AMZN\/no-login-required\/p5DVYQLL\/Amazon-AMZN-Valuation-Is-AMZN-Stock-Expensive-Or-Cheap-?fromforbesandarticle=trefis230504\">Amazon\u2019s valuation<\/strong><strong>. <\/strong>The company posted better-than-expected results in the first quarter of 2023, with net sales increasing by 9% y-o-y to $127.4 billion. It was due to an 11% rise in the North America segment and a 16% growth in Amazon<fbs-ticker data-name=\"AMZN\" data-href=\"https:\/\/www.forbes.com\/companies\/amazon\" data-type=\"stock\"><br \/>\n  AMZN<br \/>\n <\/fbs-ticker> web services revenues. However, the international segment witnessed stagnant growth in the quarter. Further, the other expense figure was reduced from -$8.6 billion to -$443 million. Notably, the year-ago figure included a valuation loss of $7.6 billion from an equity investment in Rivian Automotive. Overall, the net income improved from -$3.8 billion to $3.2 billion.<\/p>\n<p>The company\u2019s top line grew 9% y-o-y to $514 billion in FY2022, driven by a 13% increase in North America and a 29% jump in the AWS unit. On the flip side, the international segment posted negative growth (down 8% y-o-y). Further, the profitability numbers suffered in 2022 because of a significant spike in non-operating expenses. Altogether, the firm reported a net loss of $2.7 billion in the year.<\/p>\n<p>Moving forward, AMZN expects the revenues to remain between $127 billion to $133 billion in Q2 2023. Overall, we estimate <strong data-ga-track=\"ExternalLink:https:\/\/www.trefis.com\/data\/companies\/AMZN\/no-login-required\/HcytK2Km\/Amazon-Revenues-How-Does-AMZN-Make-Money-?fromforbesandarticle=trefis230504\">Amazon\u2019s revenues<\/strong> to touch $546.5 billion in FY2023. Additionally,<strong> <\/strong>the adjusted net income margin is likely to improve in the year, resulting in a net income of around $15 billion and revenue-per-share of $54.14.<strong> <\/strong>This coupled with a P\/S multiple of just above 2x will lead to a valuation of $132.<\/p>\n<p>What if you\u2019re looking for a more balanced portfolio instead? Our <strong data-ga-track=\"ExternalLink:https:\/\/www.trefis.com\/data\/companies\/PORTFOLIOS\/no-login-required\/ixlFNWUX\/High-Quality-Portfolio-30-Stocks-with-134-Return-Since-2016-vs-70-for-S-P-500?fromforbesandarticle=trefis230504\">high-quality portfolio<\/strong> and <strong data-ga-track=\"ExternalLink:https:\/\/www.trefis.com\/data\/companies\/PORTFOLIOS\/no-login-required\/M7MacZNG\/Multi-Strategy-Portfolio-262-Return-Since-2016-vs-102-for-S-P-500?fromforbesandarticle=trefis230504\">multi-strategy portfolio<\/strong> have beaten the market consistently since the end of 2016.<\/p>\n<p><fbs-ad position=\"inread\" progressive=\"\" ad-id=\"article-0-inread\" aria-hidden=\"true\" role=\"presentation\"><\/fbs-ad><\/p>\n<p>Invest with <strong>Trefis <\/strong><strong data-ga-track=\"ExternalLink:https:\/\/dashboards.trefis.com\/data\/companies\/PORTFOLIOS\/no-login-required\/M7MacZNG?fromforbes\">Market Beating Portfolios<\/strong><\/p>\n<p>See all <strong>Trefis <\/strong><strong data-ga-track=\"ExternalLink:https:\/\/dashboards.trefis.com\/data\/price-estimates?fromforbes\">Price Estimates<\/strong><\/p>\n<\/div>\n<p>Read the full article <a href=\"https:\/\/www.forbes.com\/sites\/greatspeculations\/2023\/05\/04\/amazon-stock-is-undervalued\/\" target=\"_blank\" rel=\"noopener\">here<\/a><\/p>\n","protected":false},"excerpt":{"rendered":"<p>Amazon\u2019s stock (NASDAQ NDAQ : AMZN) has gained roughly 23% YTD as compared to a 7% increase in the S&amp;P500 index over the same period. However, at its current price of $104, the stock is trading 21% below its fair value of $132 \u2013 Trefis\u2019 estimate for Amazon\u2019s valuation. The company posted better-than-expected results in [&hellip;]<\/p>\n","protected":false},"author":1,"featured_media":4082,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[241],"tags":[83],"class_list":["post-4081","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-markets","tag-featured"],"yoast_head":"<!-- This site is optimized with the Yoast SEO plugin v20.6 - https:\/\/yoast.com\/wordpress\/plugins\/seo\/ -->\n<title>Amazon Stock Is Undervalued | iFintechWorld<\/title>\n<meta name=\"description\" content=\"Amazon\u2019s stock (NASDAQ NDAQ : AMZN) has gained roughly 23% YTD as compared to a 7% increase in the S&amp;P500 index over the same period. 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