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Is Amazon.com, Inc. (AMZN) the Best Stock to Buy According to Billionaire Steve Cohen?
We recently published a list of 10 Best Stocks to Buy According to Billionaire Steve Cohen. In this article, we are going to take a look at where Amazon.com, Inc. (NASDAQ:AMZN) stands against other best stocks to buy according to billionaire Steve Cohen.
Steve Cohen, a prominent figure in the world of hedge funds, is the founder of Point72 Asset Management. The firm began managing external money in 2018 following a two-year supervisory restriction imposed by insider trading accusations against Cohen’s former firm, SAC Capital. That said, Cohen’s name isn’t just known within the world of finance. After years of having a small share in the New York Mets, he spent $2.4 billion to buy the franchise in 2020. Since then, his reputation as an obsessive businessman has evolved beyond finance to Major League Baseball.
Cohen stated that the future of the US economy moving forward is uncertain, in part due to President Donald Trump’s tariff proposal. Since Trump’s inauguration, economic policy seems to have shifted from threats of import taxes on countries such as Mexico and Canada to last-minute delays when conditions were agreed upon. Meanwhile, the White House seems to have moved forward with its tariff increase on several countries, potentially sparking a tug-of-war with some of the world’s largest economies. Speaking at the FIIPRIORITY conference in Miami back in February, Cohen said the following:
“I think this is one of those moments where there’s really a lot of uncertainty and I have pretty strong views here. … Tariffs cannot be positive, I mean it’s a tax. And you can imagine tit for tat if the U.S. does something — it implements a tax on somebody, somebody else is going to perhaps raise the stakes and raise their tax back. Taxes are never positive.”
Given the uncertain macroeconomic climate, the billionaire feels the stock market may see a pullback. He expects the US economy’s growth to slow to 1.5% from 2.5% in the second half of the year. The investor said he did not expect a “disaster,” but did expect a significant sell-off as market mood weakened, stating that this is “definitely a period where I think the best gains have been had, and it wouldn’t surprise me to see a significant correction.” Furthermore, Cohen is concerned that Elon Musk’s objective of utilizing DOGE to reduce government expenditure by $2 trillion may result in the largest employment cutbacks in US history. While economists do not anticipate job cuts alone to cause a recession since they are modest in comparison to the broader job market, they do have the ability to reduce GDP growth by a small amount.
Our Methodology
For this list, we sifted through Steve Cohen’s Q4 2024 portfolio, and narrowed down his firm’s top 10 holdings as of Q4 2024. Additionally, we have mentioned the hedge fund sentiment around each stock, as of Q4 2024.
Why are we interested in the stocks that hedge funds pile into? The reason is simple: our research has shown that we can outperform the market by imitating the top stock picks of the best hedge funds. Our quarterly newsletter’s strategy selects 14 small-cap and large-cap stocks every quarter and has returned 373.4% since May 2014, beating its benchmark by 218 percentage points (see more details here).
Is Amazon.com, Inc. (AMZN) the Best Stock to Buy According to Billionaire Steve Cohen?
A customer entering an internet retail store, illustrating the convenience of online shopping.
Point72 Asset Management’s Q4 Stake: $917.68 million
Number of Hedge Fund Holders: 339
Amazon.com, Inc. (NASDAQ:AMZN) is a prominent technology company that runs the world’s largest e-commerce and cloud computing businesses. The company also offers digital streaming and artificial intelligence technology. Amazon.com, Inc.’s (NASDAQ:AMZN) e-commerce position affords it a significant competitive advantage over competitors, accounting for around 38% of total e-commerce sales in the United States.
Amazon.com, Inc. (NASDAQ:AMZN) revealed impressive results for the year 2024, with net sales up 11% year-over-year to $638.0 billion. Net sales for the fourth quarter rose by 10% to $187.8 billion, while net income nearly doubled to $59.2 billion from $30.4 billion in 2023.
On February 16, TD Cowen analyst John Blackledge reiterated his Buy rating on the AMZN stock and set a price target of $265. One of the reasons for Blackledge’s sentiments is AWS’s expected growth in generative AI income. The analyst predicts growth from $2.8 billion in 2024 to $56.3 billion by 2030. Blackledge also lauded Anthropic’s contribution to AWS’s GenAI revenue stream, which was projected to account for half of total GenAI revenue by 2024.
Ariel Appreciation Fund stated the following regarding Amazon.com, Inc. (NASDAQ:AMZN) in its Q4 2024 investor letter:
“During the quarter, we initiated three new investments, each in companies we have followed closely for a considerable time. At various points, we viewed them as missed opportunities; however, our experience with Mr. Market has taught us that patience often creates inevitable entry points. This quarter, some exciting opportunities presented themselves. The three investments are Amazon.com, Inc. (NASDAQ:AMZN), Diageo (NYSE: DEO), and Uber (NASDAQ: UBER). We will discuss each in detail below.
Overall, AMZN ranks 1st on our list of best stocks to buy according to billionaire Steve Cohen. While we acknowledge the potential for AMZN as an investment, our conviction lies in the belief that some AI stocks hold greater promise for delivering higher returns and doing so within a shorter time frame. There is an AI stock that went up since the beginning of 2025, while popular AI stocks lost around 25%. If you are looking for an AI stock that is more promising than AMZN but trades at less than 5 times its earnings, check out our report about the cheapest AI stock.
