SHARE FOCUS 2: Amazon experiences record increase in market value thanks to good numbers

(new: record increase in market capitalization and closing prices in the third paragraph)

NEW YORK (dpa-AFX) – Among the large tech companies, Amazon joined the group of companies with positively received quarterly figures on Friday. After the Google parent company Alphabet (Alphabet A (ex Google)), the computer group Apple and the software manufacturer Microsoft had already exceeded expectations, the world’s largest online retailer has now also convinced its investors. The electric car maker Tesla, the streaming service Netflix and above all the Facebook parent company Meta (Meta Platforms (ex Facebook)), on the other hand, had shocked investors in the current reporting season.

Amazon earned brilliantly in the Christmas quarter. The US group managed the announced avalanche of costs due to the enormous need for personnel and the high investments in delivery logistics better than feared – not least thanks to its highly profitable cloud business. The announcement that the prices for the “Prime” service would be increased in the USA for the first time since 2018 was also well received by the shareholders. The service, which offers access to free shipping and streaming services, among other things, will be significantly more expensive.

In the end, Amazon shares rose by around 13.54 percent to $3152.79 and were the leader in the NASDAQ 100. This also increased the company’s market capitalization by a good $190 billion in one fell swoop – such an increase in value in one day no US company had ever managed before. The technology-heavy selection index gained 1.33 percent after suffering the largest one-day percentage loss since September 2020 on Thursday under the impression of a price slump in Meta shares with a minus of a good four percent.

Analysts mostly found words of praise and in some cases increased their price targets for Amazon shares. There is hardly anything wrong with the figures for the online retailer’s Christmas quarter, wrote analyst Ross Sandler from the British investment bank Barclays.

Ingo Wermann from DZ Bank does not expect that there will be a wave of layoffs because of the first price increase since 2018. He pointed out that the attractiveness of “Prime” should be increased by additional sports broadcasts.

The expert Stephen Ju from the Swiss bank Credit Suisse now expects that the current first quarter of the business year will be the last with above-average logistics costs. The expert Brent Thill from the analysis house Jefferies added that overall the web services business as the most profitable area promises further growth.

While Alphabet’s quarterly figures had recently lifted the Google parent’s shares to a record high, Amazon’s record of a good $3,773 from July 2021 is still a long way off. From a technical point of view, the picture brightened up at least in the short term with the price jump on Friday, since the papers are now listed well above the 21-day average line.

Amazon is currently trading at $1.6 trillion on the Nasdaq. Only Alphabet, Microsoft and above all Apple are heavier./la/tih/he/he

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