Amazon will continue to dominate, this portfolio manager says

Amazon’s (Amazon Stock Quote, Chart NASDAQ:AMZN) share price has had a bit of a struggle over the month of September, falling five per cent off an all-time high set on September 4, the date on which Amazon briefly joined Apple in the exclusive $1 trillion club.

But shareholders shouldn’t panic, says David Burrows, investment manager at Barometer Capital. With strategist-in-chief Jeff Bezos at the helm, Amazon will continue to crush every sector it enters.

Today at its headquarters in Seattle, Amazon is expected to reveal a new set of gadgets related to virtual assistant Alexa, the Echo smart speaker and the Fire TV media player. And while new hardware will certainly feed into the buying build-up to the holiday season, it’s Amazon’s voraciousness when it comes to gobbling up new business sectors that’s most transfixing about the company, says Burrows, president and chief investment strategist at Barometer.

Amazon stock will continue to outperform

“I heard Jeff Bezos being interviewed and he said, ‘You know, I don’t believe in entering any fight that’s a fair fight. That’s for boxers. We enter businesses where it’s not a fair fight.’ And realistically, that’s what’s happening. They’re taking industries by storm and it’s hard to imagine that they’re anywhere close to stopping,” says Burrows, in conversation with BNN Bloomberg.

The e-commerce behemoth has been lauded for its unparalleled investment in R&D, which over the years has paid off immensely: Amazon’s supremacy in the e-commerce space is well-known, as is the dominance of its AWS cloud computing platform, while its digital advertising is currently growing at a faster clip than expected, leaving Amazon behind only Google and Facebook in terms of market share and transforming its shopping platform into a massive pay-to-play venue for online merchants.

By Amazon’s last quarterly earnings report in July, the company grew its revenue year-over-year by 39.3 per cent and its net income by a whopping 1,186 per cent, well ahead of analysts’ expectations for the quarter.

All of which is to say that the daily, weekly and even monthly ups and downs of the company’s share price are insignificant compared to Amazon’s long-term trajectory, says Burrows.

“Amazon is a secular leader in a secular theme and so I think you have to give this one the benefit of the doubt,” he says.

Disclosure: Cantech’s Nick Waddell owns shares of Amazon