Amazon.com, Inc. (AMZN)

Shares are popping 11% on a strong beat. He's happy to hold and not add more. Amazon's PE has never been attractive and certainly is not now. He was concerned about their cloud business, but it's fine. He's less concerned with their retail business. The bar was set pretty low, and shares are still far off its highs. 

Operating margins came in 3x better than expectations. There were strong results in this report and investors have been waiting a long time for that. Earnings have been suppressed by all their reinvestments and this will continue. Amazon won't be greatly impacted by moves in interest rates, though the sector has. This will rebound when we end the rate-hiking cycle--and we're near that. Amazon has more growth potential than Apple. Despite its size, Amazon still has only a small portion of global sales. Apple still has growth in services, emerging markets, but the installed base of users is enormous at 2 billion. Apple is more of a maturing company, and that's okay; Apple is predictable. Apple trades at a high PE of 30x, but that isn't sustainable for the next several years.

AWS's growth rate is 12%, great, though not as high as pre-Covid. The PE is high, so he won't chase it. Overall, the market is getting ahead of itself and we're seeing outsize responses like today.

For growth, the street sees Apple as a staple that commands pricing power. Apple couldn't meet demand for the 14 Pro, so the price of the 15 Pro will be higher. The company has levers to pull. For years, Amazon spent too much money to fuel growth, but that limited margins. Any company has to spend money on AI. Overall, Amazon is in a Goldilocks period: they will benefit from existing spending/investments, and they will improve margins for the next few quarters, but spending will resume again. Apple hasn't pulled those levers yet, but the street is giving it a premium, and demand for products is not inelastic. Watch demand in the next 2-3 replacement cycles.

Clear definite uptrend channel. Clear leader in the e-commerce space, with unparalleled scale. Advertising is very high margin. AWS cloud is growing well. Growing popularity of Amazon Prime can't be understated, very strong ecosystem. Still sees revenue growing 12-13% YOY for several years. Not a pricey name.

eCommerce, AWS & cloud computing business very strong.
Focus on cost cutting very effective.
Benefactor of consumers looking for deals. 
Shares will catch up to tech peers that have outperformed the past year.
Good for long term investors.
Established brand and infrastructure. 

Margins in retail are 2-3%. Margins in web hosting are 70-80%, so he's looking at AWS to be the home run that drives the stock forward. Likes it, will continue to run.

Up 61% thsi year. Amazon hasn't invented enough money-making things lately, and the cloud business could be troughing though could rebound in the fall.

Prime Day numbers are huge. Got ahead of themselves during Covid, but now growing into their expanded footprint. Starting to see cashflow from retail. AWS is best in breed. AI plus fulfillment is making it a leader in logistics. Lots more to go.

Shares have come back. He targets $145-148. They're the king of retail and cloud. AWS makes up 72% of their earnings. They incorporate gen AI in their cloud, plus they have smaller bets. Has long been a top holdings. Loves this stock.

Great company. Historically expensive with only 1-3% net interest margins. Going forward, hopefully greater efficiencies on e-commerce. Cloud and advertising are growing fast, and will become bigger parts of the whole business. Margin profile will improve over time, which will help it regain highs.

Will benefit from the interest in AI, as current partners in the cloud will get wind of the availability of AI models from AMZN.

Added more recently. Boasts high barriers to entry, and long term it can gain retail market share.