Amazon Shares Exceed US$3,000By Daniel González | Tue, 07/07/2020 - 13:30
In mid-April, Amazon broke a record: its shares reached a price of US$2,283, touching a historical high in terms of valuation and making Jeff Bezos, its CEO and Founder, even richer. Today, Amazon looks at that record from its rearview mirror. Amazon shares topped US$3,000, allowing the company to enter the club of enterprises valued at over US$1 trillion, alongside Apple and Microsoft, while Alphabet, which owns Google, has been hovering close to that amount for weeks. “Amazon is benefiting from very rapid sales growth, 26 percent more than in the previous year. This has allowed the price to be sustained at those levels,” Nacy Tengler, Chief Investment Officer of Laffer Tengler Investments, told CNBC. Amazon shares gained 5.77 percent on Monday to reach US$3,057 at the close of the day’s trading. This is a 64 percent increase from the start of 2020 and nearly 50 percent growth from the lowest price of Amazon shares, which was reached just at the beginning of the COVID-19 pandemic.
According to several analysts, the pandemic, mandatory confinement and the breadth of products offered by Amazon are not the only reasons for this growth. Since late 2017, Jeff Bezos has been committed to improving the technological capacity of his cloud in order to compete with other giants, such as Alphabet and Microsoft. In addition to his commitment to the cloud, which is key to Amazon’s future growth, he is also committed to space technology through his company Blue Origin and the US military contracts he hopes to win in the future. In other words, it has been a while since Amazon stopped being just an online retail company.
This commitment to diversification led Bezos on Friday to move even further away from his competitors in the rankings to see who is the richest person in the world. On that day, Bezos' fortune reached US$171 billion, a figure now overshadowed by yesterday’s stock price.
Not only did Amazon break its valuation record yesterday. Netflix, Tesla – Elon Musk, CEO and Founder, has increased his personal fortune by US$25.8 billion since the beginning of 2020 –, Square, PayPal, Nvidia and Adobe also reached their all-time highs on Monday, while Zoom Video, Peloton, Lowe's and Clorox continue to benefit from the new normality, with many workers still performing their daily tasks from home.