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After the closing bell on Thursday, Amazon (AMZN - Free Report) reported strong first-quarter results, wherein it beat both earnings and revenue estimates. Though the e-commerce giant warned about a continued slowdown in the company's profitable cloud computing unit, it provided an upbeat revenue outlook for the ongoing quarter.
Shares of AMZN initially jumped as much as 12% in aftermarket hours but dipped 2.1% to end the day after the company warned of a growth slowdown in its cloud computing unit. This has put focus on ETFs with a substantial allocation to this online behemoth. These include ProShares Online Retail ETF (ONLN - Free Report) , Fidelity MSCI Consumer Discretionary Index ETF (FDIS - Free Report) , Vanguard Consumer Discretionary ETF (VCR - Free Report) , Consumer Discretionary Select Sector SPDR Fund (XLY - Free Report) and VanEck Vectors Retail ETF (RTH - Free Report) .
Amazon reported earnings per share of 31 cents, outpacing the Zacks Consensus Estimate by a dime and improving from the year-ago earnings of 21 cents. Revenues grew 9.4% year over year to $127.5 billion and edged past the consensus estimate of $124.8 billion (read: Leveraged Tech ETFs to Cash in on Upbeat Big Tech Earnings).
Amazon’s cloud computing business — Amazon Web Services — revenues grew 16% year over year to $21.4 billion. This is down 37% from a year-ago quarter and represents the fifth straight quarter of decline. Some analysts are estimating that a slowdown in corporate technology spending could push the cloud unit’s growth rates to single digits later this year.
The world's largest online retailer expects revenues in the range of $127-$133 billion for the second quarter of 2023, suggesting 5-10% growth from the year-ago reported number. The Zacks Consensus Estimate is pegged at $129.38 billion.
ProShares Online Retail ETF offers exposure to companies that principally sell online or through other non-store channels and then zeros in on the companies that reshape the retail space. It tracks the ProShares Online Retail Index, holding 27 stocks in its basket. Amazon is the top firm, accounting for 27.1% of the portfolio (read: 4 Sector ETFs & Stocks to Win on March Retail Sales).
ProShares Online Retail ETF has amassed $98.4 million in its asset base and currently trades in a moderate volume of around 31,000 shares a day on average. It charges 58 bps in annual fees from investors.
Fidelity MSCI Consumer Discretionary Index ETF (FDIS - Free Report)
Fidelity MSCI Consumer Discretionary Index ETF tracks the MSCI USA IMI Consumer Discretionary Index, holding 329 stocks in its basket. Of these, Amazon takes the top spot with a 21.3% share.
Fidelity MSCI Consumer Discretionary Index ETF has amassed $1.1 billion in its asset base while trading in a good volume of around 74,000 shares a day on average. It charges 8 bps in annual fees from investors and has a Zacks ETF Rank #3 (Hold) with a Medium risk outlook.
Vanguard Consumer Discretionary ETF currently follows the MSCI US Investable Market Consumer Discretionary 25/50 Index and holds 307 stocks in its basket. Of these, Amazon occupies the top position, with a 21.3% allocation. Broadline Retail takes the largest share at 23.8%, while automobile manufacturers, restaurants, and home improvement retail round off the next two spots.
VCR charges investors 10 bps in annual fees, while volume is moderate at nearly 61,000 shares a day. The product has managed about $4 billion in its asset base and carries a Zacks ETF Rank #1 (Strong Buy) with a Medium risk outlook.
Consumer Discretionary Select Sector SPDR Fund (XLY - Free Report)
Consumer Discretionary Select Sector SPDR Fund offers exposure to the broad consumer discretionary space by tracking the Consumer Discretionary Select Sector Index. It is the largest and most-popular product in this space, with AUM of nearly $14.5 billion and an average daily volume of around 6 million shares. Holding 53 securities in its basket, Amazon takes the top spot with 24% of assets. Broadline retail, specialty retail, hotels, restaurants & leisure, and automobiles are the top four sectors with double-digit exposure each.
VanEck Vectors Retail ETF provides exposure to the 25 largest retail firms by tracking the MVIS US Listed Retail 25 Index, which measures the performance of the companies involved in retail distribution, wholesalers, online, direct mail and TV retailers, multi-line retailers, specialty retailers and food and other staples retailers. Amazon takes the top position in the basket with a 21.3% share.
VanEck Vectors Retail ETF has amassed $153.3 million in its asset base and charges 35 bps in annual fees. It trades in a lower volume of 4,000 shares a day on average. VanEck Vectors Retail ETF has a Zacks ETF Rank #3 with a Medium risk outlook.
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Amazon Beats Q1 Earnings, Shares Dive: 5 ETFs Worth Watching
After the closing bell on Thursday, Amazon (AMZN - Free Report) reported strong first-quarter results, wherein it beat both earnings and revenue estimates. Though the e-commerce giant warned about a continued slowdown in the company's profitable cloud computing unit, it provided an upbeat revenue outlook for the ongoing quarter.
Shares of AMZN initially jumped as much as 12% in aftermarket hours but dipped 2.1% to end the day after the company warned of a growth slowdown in its cloud computing unit. This has put focus on ETFs with a substantial allocation to this online behemoth. These include ProShares Online Retail ETF (ONLN - Free Report) , Fidelity MSCI Consumer Discretionary Index ETF (FDIS - Free Report) , Vanguard Consumer Discretionary ETF (VCR - Free Report) , Consumer Discretionary Select Sector SPDR Fund (XLY - Free Report) and VanEck Vectors Retail ETF (RTH - Free Report) .
Amazon reported earnings per share of 31 cents, outpacing the Zacks Consensus Estimate by a dime and improving from the year-ago earnings of 21 cents. Revenues grew 9.4% year over year to $127.5 billion and edged past the consensus estimate of $124.8 billion (read: Leveraged Tech ETFs to Cash in on Upbeat Big Tech Earnings).
Amazon’s cloud computing business — Amazon Web Services — revenues grew 16% year over year to $21.4 billion. This is down 37% from a year-ago quarter and represents the fifth straight quarter of decline. Some analysts are estimating that a slowdown in corporate technology spending could push the cloud unit’s growth rates to single digits later this year.
The world's largest online retailer expects revenues in the range of $127-$133 billion for the second quarter of 2023, suggesting 5-10% growth from the year-ago reported number. The Zacks Consensus Estimate is pegged at $129.38 billion.
ETFs in Focus
ProShares Online Retail ETF (ONLN - Free Report)
ProShares Online Retail ETF offers exposure to companies that principally sell online or through other non-store channels and then zeros in on the companies that reshape the retail space. It tracks the ProShares Online Retail Index, holding 27 stocks in its basket. Amazon is the top firm, accounting for 27.1% of the portfolio (read: 4 Sector ETFs & Stocks to Win on March Retail Sales).
ProShares Online Retail ETF has amassed $98.4 million in its asset base and currently trades in a moderate volume of around 31,000 shares a day on average. It charges 58 bps in annual fees from investors.
Fidelity MSCI Consumer Discretionary Index ETF (FDIS - Free Report)
Fidelity MSCI Consumer Discretionary Index ETF tracks the MSCI USA IMI Consumer Discretionary Index, holding 329 stocks in its basket. Of these, Amazon takes the top spot with a 21.3% share.
Fidelity MSCI Consumer Discretionary Index ETF has amassed $1.1 billion in its asset base while trading in a good volume of around 74,000 shares a day on average. It charges 8 bps in annual fees from investors and has a Zacks ETF Rank #3 (Hold) with a Medium risk outlook.
Vanguard Consumer Discretionary ETF (VCR - Free Report)
Vanguard Consumer Discretionary ETF currently follows the MSCI US Investable Market Consumer Discretionary 25/50 Index and holds 307 stocks in its basket. Of these, Amazon occupies the top position, with a 21.3% allocation. Broadline Retail takes the largest share at 23.8%, while automobile manufacturers, restaurants, and home improvement retail round off the next two spots.
VCR charges investors 10 bps in annual fees, while volume is moderate at nearly 61,000 shares a day. The product has managed about $4 billion in its asset base and carries a Zacks ETF Rank #1 (Strong Buy) with a Medium risk outlook.
Consumer Discretionary Select Sector SPDR Fund (XLY - Free Report)
Consumer Discretionary Select Sector SPDR Fund offers exposure to the broad consumer discretionary space by tracking the Consumer Discretionary Select Sector Index. It is the largest and most-popular product in this space, with AUM of nearly $14.5 billion and an average daily volume of around 6 million shares. Holding 53 securities in its basket, Amazon takes the top spot with 24% of assets. Broadline retail, specialty retail, hotels, restaurants & leisure, and automobiles are the top four sectors with double-digit exposure each.
Consumer Discretionary Select Sector SPDR Fund charges 0.10% in expense ratio and has a Zacks ETF Rank #1 with a Medium risk outlook (read: 6 Sector ETFs to Play for Revenue Growth Potential in Q1).
VanEck Vectors Retail ETF (RTH - Free Report)
VanEck Vectors Retail ETF provides exposure to the 25 largest retail firms by tracking the MVIS US Listed Retail 25 Index, which measures the performance of the companies involved in retail distribution, wholesalers, online, direct mail and TV retailers, multi-line retailers, specialty retailers and food and other staples retailers. Amazon takes the top position in the basket with a 21.3% share.
VanEck Vectors Retail ETF has amassed $153.3 million in its asset base and charges 35 bps in annual fees. It trades in a lower volume of 4,000 shares a day on average. VanEck Vectors Retail ETF has a Zacks ETF Rank #3 with a Medium risk outlook.