There have been three stock splits , all between and Two of the splits were 2-for-1, while the other was a 3-for-1 split. The way splits work is that you receive more shares, but the stock price is adjusted accordingly so the value of your investment stays the same -- it's not free money. You would now have shares after the stock splits. Investors who stuck with Amazon through the roller coaster ride of the dot-com bubble around would have been handsomely rewarded for their patience.
It's an important lesson that investors tend to undervalue fast-growing companies with massive opportunities to expand. Just because a stock looks overvalued doesn't mean it is. From its founding through , Amazon was unprofitable and was bleeding cash as it invested heavily in marketing, technology, and fulfillment to expand.
In , the business became free cash flow positive and has remained so every year since. Free cash flow has always been Bezos' preferred metric for gauging the profitability of the company. In his first letter to shareholders, Bezos stated, "When forced to choose between optimizing the appearance of our GAAP accounting and maximizing the present value of future cash flows, we'll take the cash flows.
AWS accounted for about two-thirds of the company's operating income in the third quarter of this year. There is also a lot of the world Amazon has yet to penetrate meaningfully, so the company still a lot to offer investors. Plus, Amazon has already proved it can find new categories or areas where it's competent to provide a competitive service, like online advertising or the Internet of Things.
Amazon has come such a long way in just 24 years. I wouldn't underestimate the company's potential from here. Cost basis and return based on previous market day close. Calculated by average return of all stock recommendations since inception of the Stock Advisor service in February of Discounted offers are only available to new members.
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With technology stocks garnering renewed scrutiny, it's helpful to take a look back at one company that has weathered some of the most severe market downturns and serious doubts from Wall Street: Amazon. Amazon's journey from tiny garage start-up to one of the most valuable companies in the world has paid off for investors, but shareholders needed a strong stomach. It was also tapping into major Silicon Valley talent to built its own sleek new website.
On top of that, it was suing Amazon over the start-up's claim to be "Earth's Biggest Bookstore. Amazon's customer growth and savvy capital fundraising combined to help it rapidly expand its offerings. Soon books became just one part of an expansive online retailer connecting customers with everything from power tools to Pokemon cards.
But Nasdaq peaked shortly after on March 10 , at 5, And the bubble burst, sending the composite down to barely 1, by October As the crash set in, dot-com companies began folding left and right. Geocities, Webvan and Boo. Hot start-ups like Pets. Amazon's stock tumbled month after month as well, losing more than 90 percent of its value in two years.
The company weathered the storm, reportedly because of shrewd management and a lucky last-minute infusion of capital right before the bubble burst. But even for those who bought in at Amazon's dot-com era peak, the investment still paid off. The mids brought a period of both skepticism and immense growth for Amazon. As the company recovered from the brutal dot-com crash, it rarely returned money to investors or made a profit. But Amazon was aggressively reinvesting its revenue.
The company continued to expand its customer base and its retail offerings. It also began experimenting with and investing in big new ideas that would payoff later like Amazon Prime, Amazon Web Services and the Kindle.
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Archived from the original PDF on Retrieved Federal Reserve System. Bretton Woods system — Employment Act of recession U. Investment Co. Institute Northeast Bancorp v. Great Recession — — U. Charles S. Hamlin — William P. Harding — Daniel R. Crissinger — Roy A. Young — Eugene Meyer — Eugene R.
Black — Marriner S. Eccles — Thomas B. McCabe — William M. Martin — Arthur F. Burns — G. Cook designate Philip Jefferson designate 1 seat vacant. Williams New York Patrick T. Harker Philadelphia Loretta J. Evans Chicago James B. Bullard St. Daly San Francisco. In its year-end earnings release, Amazon indicated that it targeted profitability by the end of While the stock continued to decline throughout the first 9 months of , the company reiterated on its 3Q earnings that it would achieve its profitability target within the next quarter.
This is just a select example, but investors can go back to the last few market crises to find similar dynamics among other stocks. This is all to illustrate that what really matters to whether a stock recovers after a bear market is:. If business performance is permanently impaired, you can expect its stock price to as well. Editor's Note: The summary bullets for this article were chosen by Seeking Alpha editors.
Additional disclosure: The information provided in this material should not be considered a recommendation to buy, sell or hold any particular security. Fund Letter Stock Ideas 8. This is all to illustrate that what really matters to whether a stock recovers after a bear market is: whether its fundamentals continue to grow throughout the period, and if the business is able to prove that it can be profitable. This article was written by.
During those years, Amazon worked to reduce its operating losses and dialed back its growth investments as a result. In its year-end earnings release, Amazon indicated that it targeted profitability by the end of While the stock continued to decline throughout the first 9 months of , the company reiterated on its 3Q earnings that it would achieve its profitability target within the next quarter. This is just a select example, but investors can go back to the last few market crises to find similar dynamics among other stocks.
This is all to illustrate that what really matters to whether a stock recovers after a bear market is:. If business performance is permanently impaired, you can expect its stock price to as well. Editor's Note: The summary bullets for this article were chosen by Seeking Alpha editors. Additional disclosure: The information provided in this material should not be considered a recommendation to buy, sell or hold any particular security.
Fund Letter Stock Ideas 8. This is all to illustrate that what really matters to whether a stock recovers after a bear market is: whether its fundamentals continue to grow throughout the period, and if the business is able to prove that it can be profitable. After reading a report that projected annual Web growth at 2, percent, Bezos drew up a list of 20 products that could be sold on the Internet.
He narrowed the list to what he felt were the five most promising: compact discs, computer hardware, computer software, videos, and books. Bezos eventually decided that his venture would sell books over the Web, due to the large worldwide market for literature, the low price that could be offered for books, and the tremendous selection of titles that were available in print.
He chose Seattle as the company headquarters due to its large high-tech work force and its proximity to a large book distribution center in Oregon. Bezos then worked to raise funds for the company while also working with software developers to build the company's web site.
The web site debuted in July and quickly became the number one book-related site on the Web. In just four months of operation, Amazon. It generated recognition as the sixth best site on Point Communications' "top ten" list, and was almost immediately placed on Yahoo's "what's cool list" and Netscape's "what's new list.
Customers could enter search information, prompting the system to sift through the company database and find the desired titles. The program then displayed information about the selection on a customer's computer screen, and gave the customer the option to order the books with a credit card and have the books shipped in a just a few days. Most orders through Amazon. At first, the company operated out of Bezos' garage, until it was clear that it was going to be a success, necessitating a move to a Seattle office, which served as the customer support, shipping, and receiving area.
It was interesting that, because of the Internet, such a small venture could realize such a broad scope so quickly; within a month of launching the web site, Bezos and Amazon. As a pioneer in the world of Internet commerce, Amazon. With that goal in mind, Bezos went to work on making the web site as customer friendly as possible and relating the site to all types of customers. For those people who knew what book they were looking for and just wanted quick performance and low cost, Amazon.
The company also began offering 10 to 30 percent discounts on most titles, making the prices extremely affordable. For other customers who were just looking for something to read in a general area of interest, Amazon.
Finally, for people who could not decide, Amazon. There a customer could find books based on his or her mood, reading habits, or preferences. The recommendation center also offered titles based on records of books the customer had purchased in the past, if they were return customers to the site.
Other hits with customers were the little touches, such as optional gift wrapping of packages, and the "eye" notification service, which sent customers e-mails alerting them when a new book in their favorite subject or by their favorite author came into stock.
The site also offered the ability for customers not only to write their comments about different books and have them published on the site, but to read other customers' comments about books they were interested in buying. After less than two years of operation, Amazon. With the proceeds from the IPO, Bezos went to work on improving the already productive web site and on bettering the company's distribution capabilities. To help broaden the company's distribution capabilities, and to ease the strain on the existing distribution center that came from such a high volume of orders, in September Bezos announced that Amazon.
There was also a 70 percent expansion of the company's Seattle center. The improvements increased the company's stocking and shipping capabilities and reduced the time it took to fill customers' orders. The Delaware site not only got Amazon. With the new centers in place, Bezos set a goal for the company of 95 percent same-day shipping of in-stock orders, getting orders to the customers much faster than before. Another growth area for Amazon. Established in July , the program allowed individuals with their own web sites to choose books of interest and place ads for them on their own sites, allowing visitors to purchase those books.
The customer was linked to Amazon. Associates were sent reports on their sales and made a 3 to 8 percent commission from books sold on their sites. The Associates program really began to take off in mid, when Amazon. Both companies agreed to give Amazon. As the success continued, Amazon also struck deals with many other popular sites, including Netscape, GeoCities, Excite, and AltaVista.
As the company continued to grow in , Bezos announced in October that Amazon. As Amazon. By February, the Associates program had reached 30, members, who now earned up to 15 percent for recommending and selling books from their web sites. Four months later, the number of Associates had doubled to 60, The company's customer database continued to grow as well, with cumulative customer accounts reaching 2. In other words, it took Amazon. This feat made Amazon.
To its catalog of over 2. Two of the companies were acquired to further expand Amazon. Bookpages, one of the largest online booksellers in the United Kingdom, gave Amazon. Telebook, the largest online bookseller in Germany, added its German titles to the mix. Both companies not only gave Amazon. The Internet Movie Database IMD , the third acquisition, was used to support plans for its move into online video sales.
The tremendous resources and information of the IMD served as a valuable asset in the construction of a customer-friendly and informative web site for video sales. Another big change in was the announcement of the company's decision to enter into the online music business.
Bezos again wanted to make the site as useful as possible for his customers, so he appealed to them for help. Several months before officially opening its music site, Amazon. The music store opened in June , with over , music titles available. The new site, which began operations at the same time that Amazon. The database was searchable by artist, song title, or label, and customers were able to listen to more than , sound clips before making their selection.
The all-time high Amazon stock closing price was on July 08, The Amazon week , , , , , , %. The closing price for Amazon (AMZN) in was $, on December 31, It was up % for the year. The latest price is $ Discover historical prices for AMZN stock on Yahoo Finance. AMZN - discover-newyork.com, Inc. Dec 01, , , , , ,