Amazon: Cloud Dominance Days Are Coming To An End
Summary
- I downgrade Amazon from 'strong buy' to 'hold' after a 40% rally, locking in gains and selling 75% of my position.
- While Amazon's Q2 results beat expectations, slowing AWS growth and alarming free cash flow trends raise red flags for future upside.
- Valuation metrics, including a high price-to-free-cash-flow and PEG ratio, suggest AMZN stock is no longer attractively priced versus peers.
- With shares near historical resistance and overbought levels, I see limited near-term upside in AMZN and prefer to wait for a deeper pullback before buying once again.
Analyst’s Disclosure:I/we have a beneficial long position in the shares of AMZN, NVDA, META either through stock ownership, options, or other derivatives. I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it (other than from Seeking Alpha). I have no business relationship with any company whose stock is mentioned in this article.
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