With the new presidential administration set to come to power in less than two weeks, there is a sense of change in the air. Some changes are already evident – President-elect Trump has made clear his intention to implement new tax policies, and his previous term in office has already shown that he favors pro-business, growth-oriented economic policies, combined with economic deregulation. This combination promises to keep the good times going in the stock markets.
Monitoring the situation from Wolfe Research, analyst Shweta Khajuria opines that there are plenty of options for investors aiming to cash in on the rising tide. In her view, healthy consumer demand, low interest rates, and low unemployment would provide a broad base of support for the economy as a whole – and for internet stocks, as she prefers them.
“We remain opportunistic in the internet sector. We expect fundamentals to remain stable with healthy overall revenue growth from penetration gains, product launches, continued margin expansion, and capital allocation efforts,” Khajuria said.
Digging into the details, the 5-star analyst picked Amazon ( NASDAQ:AMZN ) and Meta Platforms ( NASDAQ:META ) as two of the best internet stocks to buy right now. According to TipRanks’ database, these “Magnificent 7” stocks also receive a “Strong Buy” rating from the rest of the stocks on the Street. Let’s dive into the details and take a closer look at each of them.
Amazon
The first stock we’ll look at is Amazon, the world’s leading e-commerce company and a fast-growing giant in both cloud computing and artificial intelligence services. Amazon was founded in 1994 and has proven its ability to survive — the company lived through the bursting of the dot-com bubble and grew from its origins as an “online bookseller” to become a one-stop shop for the digital world. As the world’s leading e-commerce company, Amazon prides itself on its ability to deliver any product anywhere, and it delivers. The result is a giant company, with a market cap of $2.39 trillion.
Amazon’s online retail is its core business, and it accounted for 83% of its total revenue in the third quarter of 2024, it reported last period. Of its total revenue of $131.4 billion, $95.5 billion came from its North American segment. $35.9 billion came from international sales. The company saw its highest year-over-year revenue growth in its cloud computing subscription service, AWS, which expanded 19% year-over-year to $27.5 billion. Amazon’s third-quarter revenue totaled $158.9 billion, up 11% from a year earlier and beating expectations by $1.6 billion. Amazon reported free cash flow of $47.7 billion for the 12 months ended September 30, 2024, up 123% year over year, and the company ended the third quarter with more than $78 billion of cash and liquid assets on hand.
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