Amazon: ‘We still like the stock,’ analyst says following layoffs – Yahoo Finance


There's still a lot to like about Amazon (AMZN) stock, even though the company's coming off a hard year, JMP Securities Equity Research Analyst Nick Jones recently told Yahoo Finance Live (video above).
Amazon had a rough 2022, one in which the company's stock tumbled more than 40% throughout the year. The company's been battling high inflation, rising rates, and a slow advertising market, and recently announced it would up the number of layoffs it was doing in its corporate workforce from 10,000 to 18,000.
Nevertheless, Amazon's still headed in the right direction according to Jones. "We like Amazon investing in future technology, we like them investing in growth," he said. "For us, we don't think it has to happen. We like the stock from here, today."
The layoffs, Jones said, are not bad news for the company's outlook.
"It's a very small chunk of their workforce," he said, as Amazon's total corporate workforce is about 300,000 strong. "We view it as, 'They're starting to look at operating income.' This is an area that investors are increasingly looking at. They want to see Amazon give better guidance to these numbers as we progress through each quarter. So, while we don't think it's really going to move the needle materially, we like that they're focusing on this and they're making cuts."
Heading into Q4 earnings, Amazon's guidance has been weak, as the company in October said it was expecting to report between $140 billion and $148 billion in revenue to close out the year, missing analysts' expectations.
For all the turmoil the company's experiencing, Jones believes CEO Andy Jassy is playing his cards right, saying that Jassy has gotten caught in the crossfire of a macroeconomic downturn.
"You can't fight the Fed," he said. "You can't fight macro, and I think this is very much a macro, Fed-driven market, and that's really compressing multiples … more so than anything idiosyncratic to what Jassy is doing at the company."
Jassy, who took the helm at Amazon in 2021, sounded off on the company's layoff plans in a statement earlier this month.
"Amazon has weathered uncertain and difficult economies in the past, and we will continue to do so," Jassy wrote on Jan. 4. "These changes will help us pursue our long-term opportunities with a stronger cost structure; however, I’m also optimistic that we’ll be inventive, resourceful, and scrappy in this time when we’re not hiring expansively and eliminating some roles. Companies that last a long time go through different phases. They’re not in heavy people expansion mode every year."
So, where does Jones think Amazon will go from here? The key to a successful 2023 for Amazon is for the company's retail business to pick up some steam, while the company's booming cloud unit Amazon Web Services (AWS) boosts its growth.
"It's definitely still an AWS story," said Jones. "I mean, we still want to see retail work. I think advertising is under-appreciated, but heading into a recession it's hard to like advertising going into 2023. So, we really need to see AWS start re-accelerating. We need to see estimates start increasing from the retail segment."
The truth is, the macro needs to even out before we know what Amazon's next moves will look like.
"We need to bottom out in terms of estimates and get more visibility on the macro situation," said Jones. "Is the Fed going to continue to increase rates and by how much? I think once we get some visibility into the cost of capital, where rates are going, that's when investors can start to pick their heads up and think about what the back half of '23 and '24 looks like."
Allie Garfinkle is a Senior Tech Reporter at Yahoo Finance. Follow her on Twitter at @agarfinks.
Click here for the latest trending stock tickers of the Yahoo Finance platform.
Read the latest financial and business news from Yahoo Finance.
Download the Yahoo Finance app for Apple or Android.
Follow Yahoo Finance on Twitter, Facebook, Instagram, LinkedIn, and YouTube.
Related Quotes
(Bloomberg) — The market is regaining its appetite for risk after a bitter 2022 as traders increasingly snap up some of last year’s biggest losers, particularly beaten down tech stocks. Most Read from BloombergPfizer Bivalent Vaccine Linked to Strokes in Preliminary DataThis Isn’t Your Mom and Dad’s Recession, Says BofA’s SubramanianAt Least 68 Dead as Nepal Plane Crashes Seconds Before Landing‘I Feel Like I Got Duped’: Tesla Price Drop Angers Current OwnersThe Apartment Market Is About to Get
PPL, a utility based in Allentown, Pa., said this week that it plans to raise its next quarterly dividend by 7%. The stock, which yields 2.9%, has a one-year return of about 6%, dividends included, compared with minus 14% for the S&P 500 through Thursday’s close. In other dividend news, Citigroup (C), Procter & Gamble (PG), Target ( TGT ), Colgate-Palmolive (CL), and Lennar (LEN) were among the large companies that said this week they will maintain their dividends at current levels.
Old age and a fixed income does not preclude you from getting a home loan. You may not qualify for a larger mortgage that requires more earned income, you can still get a home loan with Social Security alone. However, … Continue reading → The post Getting a Mortgage With Only Social Security Income appeared first on SmartAsset Blog.
With the U.S. on track to hit the debt ceiling limit next week, Treasury Secretary Janet Yellen warns 'extraordinary measures' will be taken to navigate the crisis.
Stock market indexes continued to trade well above intraday lows as numerous stocks broke out of well-defined bases. In afternoon trading, the Nasdaq composite was flat and the S&P 500 was down 0.2%. The Dow Jones Industrial Average fell 0.1%.
The cable and internet giant's Xfinity brand has a deal that looks a lot like it's upstart rival but you need to look closer.
Jeff Bezos is a visionary leader, but he went through a rough patch during the dot-com crash, just like this CEO is going through right now.
Competitors, regulators and an economic slowdown have started to make a meaningful dent in the fortunes of the largest tech companies.
Country music singer Garth Brooks once said that he had more money than his great-grandchildren would be able to spend. Here are three stocks that could create lasting generational wealth. If you haven't heard of base editing, just give it some time.
(Bloomberg) — The S&P 500 is technically still mired in a bear market, but a closer look below the surface shows that most of its stocks are in the midst of a big rally.Most Read from BloombergPfizer Bivalent Vaccine Linked to Strokes in Preliminary DataThis Isn’t Your Mom and Dad’s Recession, Says BofA’s SubramanianAt Least 68 Dead as Nepal Plane Crashes Seconds Before Landing‘I Feel Like I Got Duped’: Tesla Price Drop Angers Current OwnersThe Apartment Market Is About to Get UglyWhile the ben
The era of easy money is coming to a close and value investing may be due for a comeback. The Federal Reserve on Wednesday announced its plan to cool off red hot inflation by curtailing monthly bond purchases by March … Continue reading → The post Why It May Be Time to Turn to Value Investing appeared first on SmartAsset Blog.
These companies have achieved such long dividend growth streaks thanks to a meaningful business moat and resilience to recessions.
It’s mid-January now, and 2023 is into full swing. The holidays are behind us, and the future ahead of us has yet to be written – and what better time than now to start setting up a stock portfolio to carry into that future. The key to success remains the same as always, finding the right stocks that are primed for gains and solid returns. Recognizing them is the trick. That’s where the Smart Score comes in. Based on TipRanks’ advanced AI algorithms, the Smart Score collects data on all of Wall
The market rally broke above key resistance this past week. Investors should take action, carefully. Tesla stock is in the midst of a tough transition.
The following real estate investment trusts (REITs) all trade below their book value, and each one pays a dividend. If the Federal Reserve ever makes the pivot back to lowering interest rates, REITs such as these may be of interest to patient investors. While the wait continues for a change in the rate environment, an investor continues to receive a dividend. That’s the idea, anyway. It may or may not work out that way, but for those interested, here are the REITs: Medical Properties Trust Inc.
Electric vehicles (EVs) are quickly becoming a key part of automakers' lineups, and a recent survey by KPMG showed that auto executives believe EVs will account for up to 40% of their new-vehicle sales by 2030. Investors might want to consider buying Ford (NYSE: F), while being very cautious before jumping in with ChargePoint Holdings (NYSE: CHPT).
And how you can turn their financial success into your own.
Using technical analysis of the charts of those stocks, and, when appropriate, recent actions and grades from TheStreet's Quant Ratings, we zero in on three names. While we will not be weighing in with fundamental analysis, we hope this piece will give investors interested in stocks on the way down a good starting point to do further homework on the names. Greenbrier Companies recently was downgraded to Hold with a C rating by TheStreet's Quant Ratings.
Growth stocks aren't getting the positive attention from investors that they were even a year ago, but that could offer a moment of opportunity. For investors with a healthy risk tolerance level, you needn't turn to the crypto markets to find investments with compelling paths to delivering favorable financial and shareholder returns. Intuitive Surgical (NASDAQ: ISRG) has a simple yet compelling business model that has enabled it to put up stunning growth and deliver incredible returns to shareholders throughout the years.
If you own a home or have been interested in buying one, you are aware of the sizeable U.S. residential real estate downturn. Sales numbers are dropping to their lowest rates since 2020, but interest rates continue to rise to around 6.5%. This scenario doesn’t mean investors should look to another option viewed as less volatile. Take real estate investment trusts (REITs), for example. REITs are not just a platform for investing in residential real estate, offering properties such as retail space

source


Leave a Reply

Your email address will not be published. Required fields are marked *