Amazon Joins Dow Jones on Growth Potential from E-Commerce, Ads, Cloud Computing, and AI Investments

Amazon was added to the Dow Jones Industrial Average in 2023, replacing Walgreens Boots Alliance. Despite already gaining 950% over the past decade, analysts still see further growth potential.

In Q4 2022, Amazon exceeded expectations with 14% revenue growth driven by advertising and third-party seller services. Operating margin hit 7.8%.

Amazon has strong positions in three high-growth markets e-commerce, digital advertising, and cloud computing. Investments in AI could yield tens of billions in revenue.

Amazon Web Services leads in cloud infrastructure and AI developer services. As businesses move workloads to the cloud, AWS is well positioned to benefit from the AI boom.

At a reasonable 3.3x sales valuation, analysts see 11% annual growth over the next five years. But AI success could drive even faster growth for Amazon.