Amazon Trades at P/E of 32 With AI-Focused AWS and Satellite Broadband Plans
AMZN•Berkshire Hathaway’s Greg Abel reduced Amazon holdings even as the company trades at a P/E of 32 and readies satellite broadband services. Amazon is leveraging AI via AWS custom chips and development tools while sustaining robust e-commerce growth.
1. Berkshire Hathaway Reduces Amazon Stake
On May 31, Greg Abel sold a portion of Amazon shares, marking a shift in Berkshire Hathaway’s investment posture on the e-commerce leader. The exact size of the stake reduction has not been publicly disclosed but drew significant market attention.
2. Expansion of AI and Cloud Capabilities
Amazon is intensifying its focus on artificial intelligence through AWS, developing custom silicon chips and new development tools aimed at improving performance and margins. This push positions AWS to capture a growing share of enterprise AI workloads.
3. New Satellite Broadband Initiative
The company is preparing to launch satellite broadband services under its Project Kuiper initiative to diversify revenue beyond e-commerce and cloud. Successful deployment could open new markets in underserved regions and bolster long-term growth.
4. Attractive Valuation at P/E 32
Amazon’s current price-to-earnings ratio stands at 32, viewed by many analysts as reasonable given its projected expansion in cloud computing and emerging ventures. This valuation offers a potential entry point compared with higher-multiple tech peers.
