Chowdhry: Amazon AWS Is 'Secular Negative' For These Stocks

Trip Chowdhry views Amazon.com, Inc.

AWS as "secular negative," after he recently spoke to industry experts and attended several summits and events. Chowdhry says, "Amazon AWS currently has a win-rate of at-least 6:1." Chowdhry recently attended the Government Cloud Summit, Backend-as-a-Service (Baas) Hackathon, Micro-Services and Containers Summit, Machine Learning Hackathon over the last couple of months, and had spoken to no less than 400 people. AWS winning recipe is "data gravity." "Our report only focuses on AMZN AWS business, and not on AMZN eCommerce business. It is possible that strength in AMZN AWS business may be overshadowed by the concerns in AMZN eCommerce Business, and AMZN stock may not appreciate just because of strength in AMZN AWS business," Chowdhry said. Amazon's AWS business continues to stay strong. Chowdhry noted that Amazon's 4Q'2015 AWS revenues growth may be estimated to reach nearly 60 percent y-o-y to about $2.27 Billion; total FY2015 revenues to about $7.7 Billion, up 67 percent y-o-y. Amazon AWS is continuing to put forth investments expanding its geographical territories and new data centers. The analyst emphasized AMZN AWS is secular negative "strength" for all of the enterprise data center hardware providers including: NetApp Inc.

, Cisco Systems, Inc.

, Juniper Networks, Inc.

, Palo Alto Networks Inc

, Arista Networks Inc

, Rackspace Hosting, Inc.

, VMware, Inc.

, Teradata Corporation

, Akamai Technologies, Inc.

, Pure Storage Inc

, and F5 Networks, Inc.

. However, Chowdhry views the current "work loads" to remain in migration from On-premises to AWS Cloud, and commented that this is "bad news" for all Enterprise Hardware companies and all those stocks should be "avoided". "We have not come across a single customer, who said they are increasing their investments in behind the firewall technologies," Chowdhry said.