Much like the rest of the tech sector, Amazon (NASDAQ:AMZN) has not done too well this year. In fact, AMZN stock is down 16% so far this year. However, Amazon is looking to break the funk, and two major announcements will help.
Amazon has announced that Buy With Prime will be the next step in its Prime strategy. By extending its Prime service to other retailers and platforms, AMZN will benefit. Specifically, Amazon merchants who use Fulfillment By Amazon can now add the Prime Buy button to their sites. Prime members will be able to buy from these stores directly. Nevertheless, members can still enjoy all the benefits of Amazon’s logistics simultaneously.
Not only does it help Amazon get new members, but it also helps bring in more revenue for the company as Prime subscribers spend more. Introducing Buy With Prime means extending Amazon’s comprehensive logistics services. This also makes it easier for sellers to get their products out there.
In addition, Amazon has made a very interesting acquisition in India. It has purchased GlowRoad, an Indian social commerce startup. GlowRoad is a company that sells its products directly to customers at wholesale prices. Their system also provides the ability for customers to resell these products and collect cash from them. This move signals Amazon’s intent to take its business in India to the next level, as it aims to be a leading e-commerce company there.
Amazon has invested a massive $6.5 billion in India, which ranks among the top 10 economies of the world.
AMZN Stock Is a Buy as It Gears up for Share Split
Amazon is a sound investment in any economic climate.
Amazon has maintained its margins and grown its revenues even during the recession. This is because Amazon was able to optimize its supply chain and inventory management process by investing in technology to allow it to have better control over the inventory it had on hand.
The company has also streamlined its customer service process by investing in self-service technologies that allow customers to resolve any issues themselves without contacting customer service representatives. This has allowed Amazon to reduce its operating costs without compromising the quality of customer service.
Therefore, the issue of buying AMZN stock becomes all about timing. The expected date of Amazon’s stock split is June 3, 2022. It’s a strategy that several tech companies are using to give more retail investors access to shares that are otherwise considered high priced. Alphabet (NASDAQ:GOOG, NASDAQ:GOOGL) is doing the same and Shopify (NYSE:SHOP) is another example.
After announcing the stock split and $10 billion share repurchase program, AMZN stock had its second-best day of 2022. This is a phenomenon that is regularly seen when a company announces a stock split. Therefore, expect shares to keep climbing to the actual split in the runup. In the meantime, like the deals above, the tech giant will keep giving you new reasons to invest.
On the publication date, Faizan Farooque did not have (either directly or indirectly) any positions in the securities mentioned in this article. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.com Publishing Guidelines.
