Amazon (AMZN) is not the only stock that went down. Because of coronavirus, China will stop providing necessary physical and virtual services to the U.S. As a result, the market reacts with the overall drop in prices.
At the beginning of 2020, e-commerce giant Amazon.com Inc (NASDAQ: AMZN) has been showing not a very impressive performance. Such an outcome results from the company’s stock underperforming significant benchmarks over the previous six months. Until mid-January 2020, Amazon could not boast great results. But then, the company started a comeback.
After posting Q4 2019 results, Amazon (AMZN) stock soared 10%. The company’s stock continued its growth, climbing 15% over the past month. The retailing giant reported revenue of $87.44 billion, ahead of $86.03 billion expected, and GAAP EPS of $6.47 versus expectations of $4.05. Besides, net sales increased 21% to $87.4 billion in the fourth quarter. Operating income also increased, reaching $3.9 billion. Net income increased to $3.3 billion in the fourth quarter or $6.47 per diluted share.
Since the company’s report, its valuation finally started to climb again. As a result, some analysts foresee the AMZN stock price hitting $5,000 in 2023.
Currently, Amazon (AMZN) stock is obviously headed to $2,500, although some failures take place.
On Friday, February 21, Amazon stock fell by 3.02% to trade at $2,088.53 on the NASDAQ exchange. Since the start of the Friday session, the volume of Amazon shares was 3.69 million. That day, Amazon stock was trading in a range of $2,088.53 to $2,144.16. Over the past seven days, its highest mark made up $2,185.10, the lowest — $2,088.53.
Currently, in the pre-market, AMZN stock is trading at $2019.00. Its market cap makes up $1.043 trillion.
It seems that this year is a comeback for the giant, however, it is the second worst-performing among FAAMG stocks over the past six months. Despite the fact that its cloud business Amazon Web Services (AWS) now dominates the industry, there is a possibility of rivals outperforming Amazon. Its main competitors, Microsoft‘s Azure platform and Alphabet‘s Google Cloud, already combine to make up about 57% of the market.
Amazon (AMZN) Stock Is Down Because of Coronavirus
By the way, Amazon is not the only company to suffer drop on Friday. Because of coronavirus, China will stop providing necessary physical and virtual services to the U.S. As a result, the market reacts with the overall drop in prices. Trading on February 21 illustrated that dramatically. As we have reported, the Dow industrial average index had lost 280 points at one moment, closing with a loss of 227,57 points. Stocks were falling too, with Microsoft Corporation (NASDAQ: MSFT) losing 3%, Facebook Inc (NASDAQ:FB), Netflix Inc (NASDAQ: NFLX) losing 1.5% each.
The drop was unexpected, the traders were not ready for that. It immediately followed new records set by S&P 500, Nasdaq Composite, and Dow Jones Industrial Average index. The tech stocks were in the green, therefore, new peaks were reached.
But now the situation is a whole different. What will come next is unpredictable. As we can see, a lot depends on the coronavirus, the progress of which is also vagarious.