Amazon (AMZN) and Facebook (FB) Stocks Hit New All-Time Highs Despite COVID-19 Pandemic

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by Bhushan Akolkar · 3 min read
Photo: Shutterstock
Photo: Shutterstock

Investors have turned bullish on tech companies as COVID-19 could possibly change consumer behavior making them more online dependent. While Amazon accelerates its move in the gaming industry, Facebook makes a big announcement to step in e-commerce with Facebook Shops. FB and AMZN stocks are hitting new highs.

While the COVID-19 pandemic has perturbed businesses all across the globe, a few tech giants are working their way out to move up the game. On Wednesday, May 20, the stock price of Facebook Inc (NASDAQ: FB) and Amazon.com Inc (NASDAQ: AMZN) made their new all-time highs in the market.

Facebook (FB) stock claimed a massive 6% after company CEO Mark Zuckerberg announced a new shopping feature. On Wednesday closing the FB stock was trading at a price of $229.97 taking the company’s market northwards of $650 billion. With this, Facebook has recovered investors’ wealth after the massive price crash in March 2020. During the broader market correction, the FB stock corrected below $150 levels. However, it has made a quick recovery since then.

As well as Facebook, e-commerce giant Amazon (AMZN) has come out with flying colors in these testing times. Amazon has been making the right moves to deliver stuff for people staying at home during the lockdown. The company has made the most of the opportunity as Amazon stock has been shooting northwards since April 1.

Just in the last 40 days, the AMZN stock price has appreciated 25% so far. As on Wednesday closing, the Amazon stock price was trading at $2497 with a market cap of $1.25 trillion. Tech stocks have been the choice of investors during the pandemic season as the world is looking at some major shifts in consumer behavior in the long run.

Amazon Expanding Its Activities

Besides, with more people expected to work from home, Amazon is also trying to tap into the gaming industry. On Wednesday, Amazon’s gaming division – Amazon Game Studios – introduced its big-budget fire-to-play shooter game named Crucible. Gaming has been the major forte for Amazon so far. However, Wedbush analyst Michael Pachter says that Amazon plans to enter games distribution the same way they entered into books and music.

“If they go further into games, it makes sense that they will offer a streaming service, and they probably want ‘exclusive’ games for that service,” he wrote to CNBC.

Facebook on Its Way to Be a Trillion-Dollar Company

Well, all eyes of investors’ have been on Facebook being the next tech giant to join the trillion-dollar club. On Tuesday, Facebook CEO Mark Zuckerberg announced the platform’s new feature dubbed Facebook Shops.

Looking to tap into the massively growing e-commerce space, Facebook plans to offer a completely integrated buying experience to its users. With Facebook Shops, sellers can set-up their own shopping stores on Facebook and Instagram, and buyers will get a unified purchase experience.

With this move, Facebook has launched a straight-away war with several other online e-commerce giants Amazon and Google LLC (NASDAQ: GOOG) (NASDAQ: GOOGL). Analysts think that this could help the company to reach its trillion-dollar milestone much faster. Deutsche Bank analyst said that this move can help Facebook rake massive profits.

“We think Facebook Shop in a simplistic bull case could drive up to as much as a $30 [billion] revenue opportunity, across a combination of take-rate driven transactional and advertising revenue,” he said.

In a note to clients, AB Bernstein said that Facebook Shops can unlock a $1.3 trillion market. “We have long viewed FB as the ‘rent’ to the digital economy. And a core component of the online retail ecosystem,” wrote the analyst.

You can read about other companies’ activities in our business news category.

Business News, Market News, News, Stocks
Bhushan Akolkar
Author: Bhushan Akolkar

Bhushan is a FinTech enthusiast and holds a good flair in understanding financial markets. His interest in economics and finance draw his attention towards the new emerging Blockchain Technology and Cryptocurrency markets. He is continuously in a learning process and keeps himself motivated by sharing his acquired knowledge. In free time he reads thriller fictions novels and sometimes explore his culinary skills.

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