Amazon (AMZN +1.93%) didn't deliver for investors last year, trailing the S&P 500's 18% gain with a mediocre 5% rise. But that happens sometimes, and investors should always keep the long-term picture in mind. In fact, since Amazon stock has sagged, it could be a great opportunity to buy shares. Here are three reasons to buy Amazon stock today.
Image source: Amazon.
1. Strong e-commerce results from the holiday season
The fourth quarter includes the all-important holiday season, so it typically has the highest sales volume of the year. That's why a typical sales chart has highs and lows that correlate annually.
AMZN Revenue (Quarterly) data by YCharts
Results from other sources show strong spending for the 2025 holiday season, especially for e-commerce. According to preliminary results from Visa, holiday spending increased 4.2% year over year, while e-commerce sales increased 7.8%. Amazon controls around 40% of U.S. e-commerce, so that's a great indication of what Amazon might tell shareholders next week in its fourth-quarter report.
According to Visa's update, physical retail accounted for 73% of total spending. That's also good news for Amazon shareholders, since it implies that Amazon still has a huge untapped opportunity in shifting retail sales to e-commerce.
2. Accelerating AWS growth
The exciting part of Amazon's business right now is artificial intelligence (AI). Although Amazon uses AI throughout its vast enterprise, the AI business runs through the Amazon Web Services (AWS) cloud segment. AWS is the largest cloud provider in the world, with around 29% of total market share, and even at its size, sales accelerated to 20% year over year in the 2025 third quarter.
NASDAQ: AMZN
Key Data Points
Management is investing in AWS' AI development, pouring more money than any other of the huge hyperscalers into its platform. It spent about $125 billion in 2025 and plans to up that in 2026. As more clients want to engage with AI, they're moving to the cloud, boosting AWS sales.
CEO Andy Jassy thinks that there's going to be a huge shift over the next 10 to 20 years as more clients hop over to the cloud and use the AI tools available there, giving the company a huge growth runway in this business alone.
3. Low price
Amazon performed well last year, but the stock didn't climb too much higher. Investors seem to be pessimistic about its AI business as compared with the competition.
At the current price, Amazon stock trades at a price-to-earnings (P/E) ratio of 33. While that's not objectively cheap, it looks fairly valued or even undervalued considering the company's dominance and opportunity.
