Unmistakably one of the most successful companies of our time (and arguably in the history of entrepreneurship), Amazon.com Inc. (NASDAQ: AMZN) is one of the world’s most valuable public companies. Buy Amazon stock.
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Amazon at a Glance
Amazon’s historical trajectory and double-down launch toward success are
It began expanding internationally in 1998 and it continued to build its fulfillment center infrastructure. From there, Amazon continued growing at a pace unmatched by any other company.
In 2006, Amazon plowed through the $10 billion
- Amazon Web Services (AWS) for public usage
- Kindle unveiled
- AmazonFresh and Amazon Music
In the 2010s, a few more things contributed to Amazon’s upward swing:
- Amazon Prime Video (released in 2011)
- Cloud computing area with Amazon AWS
- Crowdsourcing with Amazon Mechanical Turk
- Amazon Restaurants
- Streaming services like Amazon Music and Amazon Video
- A cashier-less grocery store was added to Amazon’s arsenal
Amazon reached a $1 trillion market cap on September 4, 2018 and marked 25 years in business on July 5, 2019.
History of Amazon (NYSE: AMZN)
Amazon went public on May 15, 1997, and the IPO price was $18. Amazon’s stock splits were part of Amazon’s history and contributed to its trajectory as well. The company’s board of directors increased the number of outstanding shares by issuing more shares to current shareholders on the following dates:
- June 2, 1998 2-for-1 split
- Jan. 5, 1999 3-for-1 split
- Sept. 2, 1999 2-for-1 split
Check out information about Google’s stock split on Benzinga for another perspective on stock splits.
Why Purchase Amazon?
You’ll be able to unearth a few pros and cons to buying Amazon stock. Some are obvious, some not so much.
Pros of purchasing Amazon stock:
- Jeff Bezos, CEO of Amazon, is a major pro himself. He’s a founder who runs his own company, invests in growth opportunities, leads gigantic markets
and attracts and motivates talented individuals. - Amazon’s diversification keeps exposures wide, from cloud computing to advertising to global e-commerce.
- Has a willingness to dip its toe into a wide range of industries and sees opportunities in online shopping.
Cons of purchasing Amazon stock:
- It’s pricey. As of October 6, 2020, AMZN opened at $3,165 per share.
- Amazon faces increasing direct-to-consumer online sales competition.
- The company faces overvaluation and regulatory risks.
How to Purchase AMZN Stock
While you cannot buy Amazon stock through a direct stock purchase plan, you can choose a brokerage firm to purchase AMZN. Here are some general guidelines for purchasing stock.
Step 1: Determine how much you’d like to invest in AMZN.
Generally speaking, you should only invest an amount you could afford to lose. Stocks can be volatile and it’s easy to lose money, even with a powerhouse like Amazon.
Step 2: Choose an online broker.
Once you’ve determined how much you’d like to invest, you can contact a broker and sign up for an account, fund the account, then place a “buy” order on the stock.
You can also sign up for an online broker and apply for an account, fund the account, and buy AMZN through the broker’s online interface. Don’t have a broker? Choose from one of Benzinga’s top online stock trading brokers. Here’s a quick look at our favorites below.
Commissions
Account Minimum
1 Minute Review
Webull, founded in 2017, is a mobile app-based brokerage that features commission-free stock and exchange-traded fund (ETF) trading. It’s regulated by the Securities and Exchange Commission (SEC) and the Financial Industry Regulatory Authority (FINRA).
Webull offers active traders technical indicators, economic calendars, ratings from research agencies, margin trading and short-selling. Webull’s trading platform is designed for intermediate and experienced traders, although beginning traders can also benefit.
Webull is widely considered one of the best Robinhood alternatives.
Best For
- Active traders
- Intermediate traders
- Advanced traders
Pros
- Commission-free trading in over 5,000 different stocks and ETFs
- No account maintenance fees or software platform fees
- No charges to open and maintain an account
- Leverage of 4:1 on margin trades made the same day and leverage of 2:1 on trades held overnight
- Intuitive trading platform with technical and fundamental analysis tools
Cons
- Does not support trading in mutual funds, bonds or OTC stocks
Commissions
Account Minimum
1 Minute Review
TradeStation is for advanced traders who need a comprehensive platform. The brokerage offers an impressive range of investable assets as frequent and professional traders appreciate its wide range of analysis tools. TradeStation’s app is also equally effective, offering full platform capabilities.
Best For
- Advanced traders
- Options and futures traders
- Active stock traders
Pros
- Comprehensive trading platform and professional-grade tools
- Wide range of tradable securities
- Fully-operational mobile app
Cons
- Confusing pricing structure to leave new traders with a weak understanding of what they pay
- Cluttered layout to make navigating TradeStation’s platform more difficult than it should be
Commissions
Account Minimum
1 Minute Review
This publicly listed discount broker, which is in existence for over four decades, is service-intensive, offering intuitive and powerful investment tools. Especially, with equity investing, a flat fee is charged, with the firm claiming that it charges no trade minimum, no data fees, and no platform fees. Though it is pricier than many other discount brokers, what tilts the scales in its favor is its well-rounded service offerings and the quality and value it offers its clients.
Best For
- Novice investors
- Retirement savers
- Day traders
Pros
- World-class trading platforms
- Detailed research reports and Education Center
- Assets ranging from stocks and ETFs to derivatives like futures and options
Cons
- Thinkorswim can be overwhelming to inexperienced traders
- Derivatives trading more costly than some competitors
- Expensive margin rates
Step 3: Buy the amount of AMZN stock you want.
There are generally two types of “buy” orders: market order and limit order. A market order will execute the purchase at the present market price, while a limit order will only execute if the price falls at or below the limit price.
Although a limit price might give you a lower price of entry, there is no guarantee that the limit order will execute.
Future Outlook for Amazon Stock
It took seven and a half years for Amazon to reach $1,000 from $100 and it’s very possible that it could hit $10,000 between 2023 and 2025. Amazon’s potential to grow could continue over time.
Is Amazon Right for Your Portfolio?
It’s a nerve-wracking possibility to buy an overvalued stock, or one with a current price that is not justified by its earnings outlook or price-earnings (P/E) ratio. Is Amazon one of those?
There’s heated debate on both sides of the spectrum, that Amazon will not be able to sustain its current rate, or that it will be subject to price-earnings contraction. In addition, it’s possible that investors could become less enamored by Amazon’s future growth possibilities.
Furthermore, you can find less expensive ways to load your plate with e-commerce and cloud trends. Buy during price drops if you’re worried about overpaying for shares.
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Disclaimer: These stocks are not stock picks and are not recommendations to buy or sell a stock. Rather, these ideas should be viewed as potential opportunities for elevated levels of volatility and trader interest and thus increased liquidity. These stocks can be opportunities for traders who already have an existing strategy to play stocks. Benzinga does not recommend trading or investing in low-priced stocks if you haven’t had at least a couple of years of experience in the stock market. For a full statement of our disclaimers, please click here.