Amazon: The Leading AI and E-commerce Giant Shaping the Future
Amazon: The Ultimate AI Growth and E-commerce Powerhouse Making Investors Eager
This company recently made some changes that could supercharge earnings. Investors who want to benefit from the artificial intelligence (AI) boom often turn to Nvidia, and for good reason. The company is the global leader in AI chips, and that's translated into a surge in earnings in recent times.
Nvidia and the Magnificent Seven
Nvidia is one of the stocks referred to as the "Magnificent Seven," a group of technology players that are leaders in their industries -- and each one also happens to be investing in AI. So Nvidia isn't the only company set to score an AI victory and share that victory with investors.
- In fact, another member of the Magnificent Seven is particularly interesting because it offers you exposure to AI as well as access to another high-growth business. So, forget Nvidia, and let's check out this top stock to buy now.
Amazon and AI
Now, let's consider the company's AI story, which intersects with both its e-commerce and cloud computing businesses. Amazon has been using AI to improve its own operations, so this technology could play a role in lifting profitability this way over time.
- All of this means Amazon is set to benefit from AI in two ways.
- The technology should help it save time and money in its own business operations, therefore boosting profitability over time.
- And Amazon's position as a provider of AI products and services through AWS also should add to profit.
So investors buying Amazon shares today gain access to all of this AI growth -- and the icing on the cake is the growth potential of the company's e-commerce business. It's not surprising that Amazon, valued at 42x forward earnings estimates, trades at a slight premium to Nvidia (Nvidia trades at 36x forward earnings).
Valuation: Amazon vs. Nvidia
- Amazon's strength across e-commerce and cloud computing as well as its investment in AI makes it a business that's well diversified -- meaning it's high growth, yet doesn't come with as much risk as a company that's more dependent on selling AI products or services.
- Don't get me wrong -- Nvidia still is an attractive stock for many reasons. But Amazon offers investors a very complete package, including AI and more, and that makes it a top Magnificent Seven buy right now.
This article was prepared using information from open sources in accordance with the principles of Ethical Policy. The editorial team is not responsible for absolute accuracy, as it relies on data from the sources referenced.