In this video, I will be talking about what is arguably the best FAANG stock to buy in 2022, Amazon (AMZN 1.51%). Unlike other megacap companies, Amazon has remained fairly flat. You can find the video below, but here are some highlights.
- Two potential catalysts for 2022 would be a spinoff of Amazon Web Services (AWS) and a long-awaited stock split.
- Amazon Web Services could be worth $1 trillion alone, with more than $60 billion in annual sales. That means you are paying about $700 billion for the rest of the business, which includes the online retail business, offline shopping, advertising, Amazon Prime Video, Audible, and logistics, including warehouses, trucks, and planes. Seems like a good deal.
- It is also important to note that the faster-growing segments are now generating $56.5 billion in sales vs. the slower ones, which are generating $54.2 billion.
- According to Fortune Business Insights, the global cloud computing industry is expected to grow from $219 billion in 2020 to about $800 billion by 2028.
- While the retail part of the business is still generating the most revenue, it's a low-margin one, whereas AWS is a "money-printing machine."
- The e-commerce side of the business has been facing some headwinds due to COVID-19. Once those headwinds ease up, the company will be set to outpace the market in 2022 and onward.
- The average analyst price target is $4,137, representing a 26% upside.
For full insights, do watch the video below, and consider subscribing.
*Stock prices used are the closing prices of Jan. 10, 2022. The video was published on Jan. 11, 2022.