Amazon Poised for Strong Growth in 2023 Fueled by Higher Profits and Expanding Cloud Business
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Amazon's profitability has improved in 2023 due to lower logistics costs and a more normalized economy after COVID-19. Its North American retail segment is now profitable and margins can continue expanding.
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Amazon Web Services (AWS), its high-margin cloud computing business, continues strong double-digit revenue growth and has long runway ahead with technologies like AI computing.
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Even with zero international profits, Amazon trades at a forward P/E of 25 based on profitable business segments, suggesting shares are attractively priced.
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Amazon is poised to continue beating the market in 2024 given its growth potential and reasonable valuation.
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Over the long run, Amazon looks like a great business to own for the next decade given its leadership in key mega-trends like e-commerce and cloud computing.