E-commerce giant Amazon just made the top tier of the Fortune 500 for the first time. It also raised the price of its Prime service from $99 a year to $119, and many analysts are optimistic about the change. In a note to clients, Doug Anmuth of JPMorgan said, "We do not expect the company to get much push-back from consumers given the increasing value of the service."
The stock has generally been increasing in value too, so if you had invested in Amazon early on, your investment would have paid off. Your initial outlay of $1,000 in 2008 would be worth more than $20,000 as of May 25, according to CNBC calculations, or over 20 times as much, including price appreciation and dividend gains reinvested.
In the charts below, all data splits are adjusted and gain-loss figures do not include dividends, interest, distributions or fees except on cash accounts. The portfolio value represents current holdings and the comparison charts represent current and historical prices of individual benchmarks, stocks or exchange-traded funds.
While Amazon's stock has performed well, any individual stock can over- or under-perform and past returns do not predict future results. That's perhaps why Warren Buffett, chief executive officer of Berkshire Hathaway, opted not to invest in Amazon when he had the chance.
At Berkshire Hathaway's annual meeting last May, the self-made billionaire said he didn't appreciate the value of tech stocks at first: "I was too dumb to realize. I did not think [Bezos] could succeed on the scale he has." Citing Amazon's massive success, Buffett went on to say he "really underestimated the brilliance" of Amazon's execution and called Bezos "the most remarkable business person of our age."
Amazon's Prime service now reaches 100 million members worldwide, founder and chief executive officer Jeff Bezos, whose net worth is now more than $130 billion, announced in his annual letter to shareholders. And analysts are growing bullish about the company's momentum.
"Amazon's share in its key markets continues to expand," Justin Post of Bank of America Merrill Lynch, wrote in a note to clients. It's "success is supported by strong fulfillment infrastructure and Prime lock-in. "
If you're looking to invest in the next Amazon or considering putting some money in the stock market, experienced investors like Buffett, Mark Cuban and Tony Robbins suggest you start carefully.
Begin with index funds, they say, which hold every stock in an index, offer low turnover rates, attendant fees and tax bills, and fluctuate with the market to eliminate the risk of picking individual stocks.
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Video by Andrea Kramar