Billionaire Bill Ackman Bought Amazon Stock -- Should You?

Core Insights - Bill Ackman has made a significant investment in Amazon, purchasing 5.82 million shares valued at approximately $1.35 billion, representing about 9% of his U.S. equity portfolio [4][12] - The investment is seen as a strategic move, likely made during a market dip in April when Amazon's shares fell to $161, indicating a favorable entry point [4][12] Company Overview - Amazon is the leading player in U.S. online retail, supported by a robust logistics network, a vast third-party marketplace, and over 200 million Prime members, which creates a competitive advantage that is hard to replicate [6] - The company's e-commerce growth has slowed, but Amazon Web Services (AWS) continues to be a strong growth driver, with revenue increasing by 19% in 2024 to $108 billion, contributing significantly to overall operating profit [7] - Amazon's advertising business is rapidly growing, with a 22% increase in Q2 2025, reaching an annualized revenue rate close to $50 billion, showcasing the company's ability to monetize its user base effectively [9] Strategic Considerations - Investors are encouraged to reassess their own investment thesis regarding Amazon, considering its competitive advantages, AWS growth, and advertising potential [10] - Valuation should be checked against personal comfort levels, especially since Ackman entered at a favorable price point [11] - Monitoring key performance indicators such as AWS margins, advertising revenue trends, and Prime engagement is essential for informed decision-making [11]