How to Trade Amazon After Fiscal Q1 2024 Performance Report

May 22, 2024 02:07

Amazon is one of the world's largest cloud operators and retail giants. It is now moving into the world of AI with its billion-dollar investment in AI startup Anthropic. With a current market cap of $1.9 trillion, it could be the next $2 trillion company. Learn more about Amazon’s first-quarter 2024 performance and what analysts are forecasting for the stock below.

Stock: Amazon
Symbol for Invest.MT5 Account: AMZN
Date of Idea: 20 May 2024
Time Line: 1 - 6 months
Entry Level: $192.00
Target Level: $246.00
Position Size for Invest.MT5 Account: Max 5%
Risk: High
  • The Invest.MT5 account allows you to buy real stocks and shares from 15 of the largest stock exchanges in the world.

All trading is high risk and you can lose more than you risk on a trade. Never invest more than you can afford to lose, as some trades will lose and some trades will win. Start small to understand your own risk tolerance levels or practice on a demo account first to build your knowledge before investing.

Amazon Q1 2024 Performance

Here are some of the key highlights from the latest fiscal first quarter 2024 earnings report from Amazon: 

  • Earnings per share of 98 cents vs 83 cents per share expected 
  • Revenue of $143.3 billion vs $142.5 billion expected 
  • Net income of $10.4 billion, compared to $3.17 billion a year earlier 
  • Amazon Web Services revenue of $25 billion vs $24.5 billion expected 
  • Advertising revenue of $11.8 billion vs $11.7 billion expected 

Amazon beat analyst expectations on most metrics with growth driven by its cloud computing and advertising divisions. Its operating income was up more than 200%, showing signs that its latest cost-cutting measures could be helping its bottom line.  

The Amazon Web Services division accounted for 62% of Amazon's total operating profit, with sales up 17% in the first quarter alone. The company has already laid off over 27,000 employees and more staff are set to leave several divisions.  

CEO Andy Jassy has focused less on acquisitions and more on growing its profitable divisions such as cloud computing, advertising and Prime membership. However, in the earnings call the management team stated that cost optimisations are tapering off so much of this benefit may already be priced in the share price.  

Amazon announced it will spend $2.75 billion on AI startup Anthropic - its largest investment to date. Anthropic is regarded as a potential leader in generative artificial intelligence and competes with OpenAI's ChatGPT. The investment would be on top of its initial $1.25 billion investment from September.  

It's not yet clear how the investment will add to the bottom line. In the earnings call, the management team stated there has been a lot of interest in future AWS generative AI products. One issue is that most of the future potential of AI may already be priced into the stock.  

From a charting perspective, the share price is trading around historical all-time highs which makes it susceptible to some profit taking on good news, leading to a sharper fall.

Amazon Stock Forecast - What do the Analysts Say?

According to analysts polled by TipRanks for an Amazon stock forecast in the past 3 months, there are currently 41 buy, 0 hold and 0 sell ratings on the stock. The highest price level for a Amazon stock forecast is $246.00 with the lowest price target at $200.00. 

The average price target for a Amazon stock forecast is $220.28.

Source: TipRanks, 20 May 2024


An Example Trading Idea for the Amazon Stock Price

An example trading idea for the Amazon share price could be as follows:  

  • Buy the stock on a break above $192.00 to allow for volatility. 
  • Target just below the highest analyst price target of $246.00. 
  • Keep your risk small at a maximum of 5% of your total account.   
  • Time Line = 1 – 6 months  
  • If you buy 10 Amazon shares:  
    • If target is reached = $540.00 potential profit [($246.00 - $192.00) * 10 shares].

Remember that markets go up and down and it is unlikely the share price will move up in a straight line. In fact, it may even go much further down before it rises, as it currently trades at record highs leaving it susceptible to some profit-taking.

Be sure to exercise good risk management and always know how much you could potentially lose on a trade and the risks involved, as well as the costs.

With the Admirals Invest.MT5 account you can buy and sell US stocks with a commission from $0.02 per share. This means buying 20 shares in Amazon stock would result in a commission of $0.40 ($0.02 * 20 shares) for executing a per-side transaction.

However, there is a low minimum transaction fee of $1. So, the example trading idea above would result in a commission of just $1 overall! 

How to Buy Amazon Stock in 4 Steps  

With Admirals, you can buy shares with a low commission of just $0.02 per share and a low minimum commission of just $1 on US stocks. 

  1. Open an account with Admirals to access the dashboard.   
  2. Click on Trade on one of your live or demo accounts to open the web platform.   
  3. Search for your stock in the search window at the top right to view the live price chart. 
  4. Click Create New Order from the bottom of the screen to open the trading ticket. 
Source: Admirals MetaTrader 5. Amazon. Monthly. Date: January 2016 to May 2024, captured on 20 May 2024. Past performance is not a reliable indicator of future results or future performance.


Click on the banner below to trade Amazon stock today ▼▼▼ 

Do You See the Amazon Stock Price Moving Differently?   

Remember that all analytics and trading ideas are based on the personal view and experience of the author.

If you believe there is a higher chance Amazon share price will move lower, then you can also trade short from a CFD (Contracts for Difference) trading account which Admirals also provide.

The Trade.MT5 and Trade.MT4 account allows you to speculate on the price direction of stocks and shares using CFDs.

This means you can trade long and short to potentially profit from rising and falling stock prices.


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Jitanchandra Solanki
Jitanchandra Solanki Financial Markets Author, Admirals London

Jitanchandra is a financial markets author with more than 15 years experience trading currencies, indices and US equities. He is an accredited Market Technician with a BA Hons degree.