Missed The Prime Van On Amazon...There's An ETF For That???
A couple of months ago Amazon reported their quarterly earnings and told Wall Street it was investing the $4 billion second-quarter profit into PPE for employees and cleaning its facilities and developing in-house testing for COVID-19. Over the next few days after announcing results, every analyst on Wall Street and their grandma quickly revised their 12 month price target:
- Credit Suisse analysts, led by Stephen Ju, lifted their target to $2,800 from $2,400.
- Oppenheimer analysts, led by Jason Helfstein, boosted their target to $2,700 from $2,400.
- JPMorgan raised its price target for Amazon to $3,000...joining Goldman Sachs and Susquehanna who already had $3000 as a price target.
One week ago, Amazon cracked the $3000 level…incredible. What’s more incredible was when Jim Cramer said back in March that Amazon could hit $3000 because he felt Amazon was built for times like this and we are were in the process of adapting to a new normal. Jim’s $3000 thesis was Amazon Web Services (AWS) would be the main benefactor as the main bread winner for Amazon and as the world shift to working from home. For example, two companies that have been a lot of shine in recent months are Slack and Zoom that both rely on AWS to run their services.
Cowen analyst John Blackledge raised his share-price target on the tech and online-retail behemoth to $3,700 from $2,750, affirming his outperform rating.
Amazon has several drivers that should yield robust global revenue growth with rising margins the next several years, Blackledge wrote in a commentary.
Those are:
- Further [business-to-consumer] e-commerce market-share gains in large retail verticals;
- Emerging e-commerce verticals like [business-to-business];
- Significant opportunity in existing and newer international markets like India, Mexico, and Australia;
- [Amazon Web Services] should enjoy years of secular tailwinds, driving revenue [compound annualized growth rate] of about 25% for 2020-25, as workloads migrate to the cloud; and
- “Amazon Advertising, while still nascent, will drive both revenue growth and margin opportunity.
So if you feel you missed the Prime Van on Amazon, there’s an ETF for that. The, XLY is the Consumer Discretionary Select Sector SPDR ETF that seeks to provide an effective representation such as retail, hotels, apparel, leisure products, etc. and performance of the consumer discretionary sector of the S&P 500 Index. But what many people may not know is the top holding is Amazon. And what people may not know is Amazon represents 25% of the total ETF.
The chart suggests to go long on a pull back to the 4 hr demand at $129.
This post is my personal opinion. I’m not a financial advisor, this isn't financial advise. Do your own research before making investment decisions.
Posted Using LeoFinance
