Is Amazon Stock Still a Buy After Hitting an All-Time High?

Core Viewpoint - Amazon's stock performance presents a potential investment opportunity despite recent fluctuations in its price [1][3]. Group 1: Stock Performance - Amazon shares reached an all-time high in November 2025, with an average annual gain of 24% over the past 25 years and 40% over the last three years [1]. - The stock was only up about 5% in 2025, indicating a recent pause in its growth trajectory [3]. - The current stock price is $226.50, with a market capitalization of $2.4 trillion [4]. Group 2: Valuation Metrics - Amazon's forward-looking price-to-earnings (P/E) ratio is 28, significantly below its five-year average of 44, suggesting the stock may be undervalued [5]. - The price-to-sales ratio stands at 3.6, slightly above its five-year average of 3, indicating a potential overvaluation [5]. - Overall, Amazon's shares appear reasonably valued based on current metrics [5]. Group 3: Future Growth Potential - The company is expected to grow significantly in the future, driven by its dominance in online retail and leadership in cloud computing through Amazon Web Services (AWS) [6]. - The advertising division is also experiencing rapid growth, contributing to the company's overall expansion [6]. - Amazon benefits from competitive advantages such as network effects and economies of scale, positioning it well for future growth [6].