We’ve all known for some time now that Amazon (NASDAQ:AMZN) is no longer merely about products shipped directly to your home. Cloud services, streaming video, and more are all a part of the organization now. It’s also been ramping up its artificial intelligence (AI) presence, dropping a hefty investment in Scale AI. Investors weren’t exactly pleased by this latest branching, though, as shares slipped fractionally in Tuesday afternoon’s trading.
Don't Miss Our Christmas Offers:
- Discover the latest stocks recommended by top Wall Street analysts, all in one place with Analyst Top Stocks
- Make smarter investments with weekly expert stock picks from the Smart Investor Newsletter
Amazon, along with fellow AI enthusiast Meta Platforms (NASDAQ:META), dropped a combined $1 billion into Scale AI, a deal that bolstered Scale AI’s valuation to about $14 billion total. Amazon and Meta both were in on a Series F funding round that raised Scale AI to nearly double its former valuation.
Scale is working toward the development of AI platforms, offering help in large language models and cataloging data, among other things. It used to be that Scale was mostly just labeling data, but now it has a connection to some of the biggest models currently in play. Given Amazon’s own connections to AI, it’s no surprise that it’s looking to buy in on other developers.
Amazon Pushes Back Hardware Orders
Yet, even as Amazon buys in on AI developers, it’s pushed back some of its hardware orders. Amazon previously had an order in with Nvidia (NASDAQ:NVDA), one of the biggest names in AI infrastructure chips around. But Amazon has halted orders of Nvidia’s best chips as it’s waiting for the newer models to come out. That’s not so crazy, especially when Nvidia is already saying that the new chips will be twice as powerful as the current lineup.
Is Amazon a Buy, Sell, or Hold Stock?
Turning to Wall Street, analysts have a Strong Buy consensus rating on AMZN stock based on 42 Buys assigned in the past three months, as indicated by the graphic below. After a 58.29% rally in its share price over the past year, the average AMZN price target of $220.60 per share implies 21.21% upside potential.
Is It Wise to Allocate $1,000 Toward AMZN Stock Right Now?
Before you hurry to invest in AMZN, think about the following:
TipRanks’ team has built the Top Stocks Portfolio for investors, and Amazon is not included. Our portfolio highlights companies that have been hand-picked for their potential to deliver significant gains in the years ahead.
Discover Top Picks ➜
