Stocks ticked higher this morning as investors weighed the latest batch of corporate earnings, the future path of interest rates, the potential for a recession, and the state of the financial sector.
No doubt about it, trading for the broader market could remain bumpy in the near term, but the most significant money tends to be made by those who treat market pullbacks as opportunities to build positions in promising companies. With that in mind, read on for a look at one category-leading tech giant that’s presenting an attractive risk-reward proposition at today’s prices.
Amazon.com (AMZN)
Amazon.com stock is still down by a whopping 46% from its all-time high of $186, reached in mid-2021. But its long-term thesis remains sound, and cost-cutting efforts can help position the company to bounce back when conditions improve.
In March, Amazon announced plans to cut 9,000 white-collar employees, mainly from the cloud, advertising, and HR units. The cuts followed an earlier round of layoffs that eliminated more than 18,000 positions. Cost-cutting can create sustainable value for investors because Amazon’s macroeconomic challenges (such as inflation) look temporary.
A potential long-term growth driver is Amazon’s new initiative called project Kuiper. The company plans to launch a fleet of Low Earth Orbit satellites designed to provide affordable broadband connections around the world starting in 2024. All in all, there is much to be excited about Amazon, and the current stock price weakness looks like an opportunity to buy the dip.
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