Dickens: AMZN AWS Offers Long Runway, Other Businesses Build Wide Moat

Core Insights - Amazon shares have increased nearly 40% since the lows in April due to tariffs, but the stock is underperforming compared to its peers in the "Mag 7" group in 2025, being flat for the year while others have risen at least 15% [1][2] - The company is well-positioned in the AI sector, with significant investments in custom silicon and partnerships that could enhance its competitive edge [9][10] Company Performance - Amazon's stock is currently flat for the year, contrasting with the performance of other major tech stocks [1][2] - The company has announced various new products and partnerships, including a collaboration with the NBA and WNBA, which utilizes AWS [3][4] AI and Technology Investments - Amazon is heavily investing in AI infrastructure through AWS, with expectations for announcements related to custom silicon and AI services at their upcoming event [6][7][8] - The company is positioned to benefit from the growing demand for AI services, with a focus on workloads that do not require cutting-edge GPUs [9][10] Upcoming Events - Amazon is set to report earnings at the end of October, which is anticipated to be a significant event for the company [13] - The company will also have Prime Days next week, which could impact retail performance [13] Trading Strategies - Various trading strategies are being considered around Amazon's upcoming earnings, including bullish call verticals and cash-secured puts [15][18] - The bullish call vertical strategy involves buying a call option while selling another at a higher strike to offset costs, while the cash-secured put strategy allows for potential share acquisition if the stock price falls [15][18][20]