Much of the news about Amazon (AMZN – Free Report) on Thursday focused on the imminent divorce of CEO Jeff Bezos with his wife for 25 years. Some investors may be concerned that this may have an impact on the e-commerce giant, but this seems highly unlikely. So today we are looking at why Amazon shares seem to be a good buy at the moment.

Overview

Amazon has just experienced its worst quarter since 2008, while its Apple giants (AAPL – Free Report) and much of the market have also suffered from the closure of 2018. The company Bezos, of course, simply can not blame his 25% fall the year on the biggest slowdown. Instead, investors probably dumped AMZN's shares as the company finally showed signs of slowing its third-quarter sales.

Group revenues for the third quarter still increased 29% to $ 56.6 billion. But last quarter was marked by a significant slowdown compared to the recent growth of the e-commerce giant, which includes a 39% increase in the second quarter and a 43% increase in the first quarter. In the future, investors will likely need to treat Amazon a little differently as it enters a new stage of slower and more stable growth in its turnover.

Nevertheless, despite the slowdown in business, 41 of the 42 analysts rated on the AMZN stock made an immediate purchase, according to FactSet.

Opportunities for growth

Amazon's share of the US e-commerce market is expected to reach 50% last year, up from 44% in 2017. In addition, the Seattle-based company's third-party seller business has grown. Last quarter, Amazon's third-party vendor sales jumped 31 percent to $ 10.39 billion. At the same time, Amazon's online store sales grew only 10% to $ 29.06 billion.

In addition, Amazon Web Services, its cloud computing unit, captured 35% of the cloud infrastructure services market in the last quarter. This allowed AMZN to crush approximately 15% of Microsoft's shares (MSFT – Free Report), second, as well as IBM (IBM – Free Report), Google (GOOGL – Free Report) and Alibaba (BABA – Free Report). In addition, AWS revenues jumped 46% in the last quarter, 49% in the second quarter and 48% in the first quarter.

At the same time, Amazon's high-margin subscription activity has exploded by more than 50% in the last four quarters. Amazon is also expected to become the third-largest digital advertiser behind only Facebook (FB – Free Report) and Google, and its market share is expected to increase in the coming years as more and more consumers begin their product searches on the Internet. Amazon platforms.

Outlook and revenue trends

Amazon's revenue looks set to increase. Amazon's fourth-quarter adjusted earnings are expected to reach $ 5.48 per share, up 153.7% from the same quarter last year, based on our current consensus estimate of Zacks. AMZN's profits for the full year are expected to skyrocket to 328.6%. Investors should also note that Amazon's earnings per share for fiscal 2019 should be 35% higher than our estimate for the current year.

The company has also seen positive earnings estimates over the last seven days, which has put it in the top spot for Zacks (strong buy). Investors need to remember that earnings growth has proven to be one of the best long-term indicators of positive stock price developments.

And it's not as if Amazon's revenue should collapse. The company could simply be a victim of its own success, making it harder to publish huge growth results from one year to the next on a percentage basis.

Amazon's revenue for the fourth quarter is expected to reach $ 71.61 billion, an increase of 18.5% over the same period last year. In the short term, Amazon's revenue for the 2019 fiscal year will only be 20.5% higher than our current year's forecast of $ 280.36 billion.

Bottom line

Amazon's shares hovered around $ 1,657.73 on Thursday. This represents a decline of about 19% from their peak of 52 weeks and could provide the necessary incentive for some investors to buy AMZN shares in anticipation of a return in 2019.

Amazon will likely continue to expand its e-commerce reach, while also expanding its physical activity to further challenge companies such as Walmart (WMT – Free Report) and Target (TGT – Free Report). In addition, its high-margin AWS business, advertising, and other subscription-based businesses seem poised to make Amazon a more profitable company.

Recall also that AMZN is poised to become one of the largest streaming entertainment companies in the world as it develops into live sports in order to better compete with Netflix (NFLX – Free Report) and soon enough Disney (DIS – Free Report), Apple and AT & T (T – Free Report).

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