Amazon Stock Is Up 53% in the Year, En Route to Another Record High

AMZN StockJeff Bezos Is the Unbeatable Edge of AMZN Stock

Amazon.com, Inc. (NASDAQ:AMZN) stock hit a high of $848.64 on Monday and appears to be gradually inching toward another record closing.

“Amazon Studios” just won three Oscars at the 89th Academy Awards, and Amazon CEO Jeff Bezos couldn’t be happier. There are many factors supporting AMZN stock, but the most important one is its chief, Bezos.

Even Warren Buffett acknowledges this fact. While the world has been going crazy over Buffett buying Apple Inc. (NASDAQ:AAPL) and airline stocks, the more important story turned out to be the one stock that he missed buying.

During an interview with CNBC, the billionaire investor reflected that he really missed the boat on Amazon. He said, “Obviously, I should have bought it long ago,” but he added, “I didn’t understand the power of the model.” (Source: “Warren Buffett on Amazon: ‘I don’t have a good answer’ on why I didn’t buy it long ago,” CNBC, February 27, 2017.)

He was full of praise for the Amazon founder and CEO, whom he called a “terrific businessperson.” The business acumen of Jeff Bezos is what has transformed an online book seller to an e-commerce and technology powerhouse of today, pushing Amazon stock to $800.00-plus levels.

Bezos is never out of great ideas to push Amazon’s growth higher. “Amazon Prime” membership is the best example of this. The privileges that come with a Prime subscription are hard to ignore and, given the competitive pricing, it is hard for customers to not opt for one. The growing number of Prime memberships good proof of this, and has done magic to the impressive rise of AMZN stock.

“Amazon Alexa” was another masterstroke by Jeff Bezos, and the surprise success of the company’s “Echo” line of speakers left many impressed. At a time when everybody thought that Google parent Alphabet Inc (NASDAQ:GOOG, NASDAQ:GOOGL) would be the leader in digital assistants, Amazon Alexa-powered Echo speakers took the market by storm.

wrote earlier in Profit Confidential that Amazon Alexa is one of the top reasons to remain bullish on Amazon stock. And, being the super businessperson that he is, Bezos understands that Amazon Alexa needs to be ready as the battle with “Google Assistant” heats up in the near future.

Amazon.com has been taking steps to do just that. Amazon Alexa already supports almost 10,000 skills, with the number likely to climb up further. At the Consumer Electronics Show this year (CES 2017), a number of firms in electronics and household appliances announced their product integration with Alexa. And now another piece of good news come from the 2017 Mobile World Congress (MWC).  

Motorola has picked Amazon Alexa as its voice assistant. The company has announced a partnership with Amazon that will see the latter’s voice assistant tech embedded natively into most of Motorola’s devices in the future. (Source: “Motorola picks Amazon’s Alexa as its voice assistant,” TechCrunch, February 26, 2017.)

Speaking at a press conference at the MWC trade show in Barcelona, Dan Dery, Motorola’s VP global product lead, said, “Later this year will see deep integration of Alexa wake-up words. There won’t be any keys to press, no screen to unlock – you will simply talk to Alexa when the device is around.” He further added that Alexa would be coming to most of their devices. (Source: Ibid.)

There are also reports that Google Assistant is coming soon on millions of new “Android” devices. Even though Google has an upper hand in search capabilities, it would be interesting to see who emerges as the winner in this battle.

Amazon is betting big on the Alexa platform, and is not leaving any stone unturned to make it the best. Alexa is expected to be a big boost for the company and AMZN stock. The latest piece of news confirms this.

According to TIME Magazine, the online retail giant is developing advanced voice recognition for Alexa. Amazon has been developing a feature that would allow its voice assistant to distinguish between individual users based on their voices, according to people familiar with the company’s Alexa strategy. (Source: “Exclusive: Amazon Developing Advanced Voice-Recognition for Alexa,” TIME, February 27, 2017.)

So far, none of the well-known voice-enabled smart speakers have been able to distinguish who in a family is asking for something. Amazon’s new feature would match the person speaking to a voice sample, or “voice print,” to verify a person’s identity, according to TIME‘s source.

A user could set it so a parent’s voice would be required to make a credit card purchase. This capability is internally named as “Voice ID.” Distinguishing different voices of family members could be a big relief for parents as accidental shopping incidents could be minimized. While Echo speakers currently let the users build multiple profiles, the Voice ID feature would allow them to access their accounts without the need to switch between them or use Alexa app for the same.

The technology has been completed; it’s just a matter of integrating the feature into Echo products, said one of TIME’s sources. Voice ID could give the Echo a competitive edge against rival “Google Home” and could be a game changer for Amazon stock.

The below Amazon stock chart shows the phenomenal run of the stock over the last three months.

AMZN stock chart

Chart courtesy of StockCharts.com

And to end it all on a high note, Amazon’s Manchester by the Sea and The Salesman won three Oscars on Sunday night. Manchester by the Sea won for Best Actor and Best Original Screenplay whereas The Salesman won the Oscar for the Best Foreign Film. Jeff Bezos was present at the ceremony and tweeted his congratulations to the winners.

It was a historic achievement for the streaming industry as Netflix, Inc. (NASDAQ:NFLX) also won its first Oscar for the documentary The White Helmets. Although Netflix has received Oscar nominations in the past, the streaming giant has never been nominated in the Best Picture category.

With Manchester by the Sea, Amazon took a different approach from other services by releasing the film in traditional theaters before its streaming debut. Amazon reportedly paid $10.0 million for the rights to the movie at the Sundance Film Festival a year ago. The film debuted in November and is set for release on Amazon in May. (Source: “Amazon wins 3 Oscars in a first for streaming audio – and Jeff Bezos gets a fun shout-out,” GeekWire, February 26, 2017.)

With the strength and potential of “Amazon Prime Video” and Amazon Alexa, both Jeff Bezos and Amazon stock are likely to grab headlines in the coming days. AMZN stock has returned 53% over the last year—as compared to the S&P 500 Index that posted 24% gains in the same time period—and will likely continue inching upwards. Investors have a lot to look forward to this year, and Bezos is expected to be at the top of his game.