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After the closing bell on Thursday, Amazon (AMZN - Free Report) reported robust first-quarter 2024 results, wherein it beat both earnings and revenue estimates driven by growth in its advertising and AI-powered cloud computing units. The company provided soft guidance for the second quarter.
Shares of AMZN rose as much as 5% in aftermarket hours on elevated volume before declining to around 2%. Investors may tap the strength with ETFs having 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) .
The e-commerce giant reported earnings per share of 98 cents, outpacing the Zacks Consensus Estimate of 82 cents and the year-ago earnings of 31 cents. Revenues grew 13% year over year to a record high of $143.3 billion and edged past the consensus estimate of $142.5 billion. New generative AI features in its cloud and e-commerce businesses spurred robust growth (read: 4 ETFs to Tap the Renewed AI Craze on Wall Street).
Amazon’s cloud computing business — Amazon Web Services (“AWS”) — revenues soared 17% year over year to $25 billion, marking the highest growth in four quarters. The growth in AWS was accelerated by AI capabilities, and it is now on track for $100 billion in annual revenues. The online retailer has increased its investment in the AI startup Anthropic, pouring in another $2.75 billion in March to bring its total investment to $4 billion. Meanwhile, advertising revenues grew 24% year over year to $11.82 billion.
The world's largest online retailer expects revenues in the range of $144-$149 billion for the second quarter of 2024, implying year-over-year growth of 7-11%. The Zacks Consensus Estimate is pegged at $150.25 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 18 stocks in its basket. Amazon is the top firm, accounting for 24% of the portfolio (read: E-Commerce Boosts U.S. Retail Sales: ETFs to Tap).
ProShares Online Retail ETF has amassed $95.9 million in its asset base and currently trades in a moderate volume of around 16,000 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 285 stocks in its basket. Of these, Amazon takes the top spot with a 23% share.
Fidelity MSCI Consumer Discretionary Index ETF has amassed $1.4 billion in its asset base while trading in a good volume of around 78,000 shares a day on average. It charges 8 bps in annual fees from investors and currently has a Zacks ETF Rank #2 (Buy) with a Medium risk outlook.
Vanguard Consumer Discretionary ETF currently follows the MSCI US Investable Market Consumer Discretionary 25/50 Index and holds 304 stocks in its basket. Of these, Amazon occupies the top position, with a 23.1% allocation. Broadline Retail takes the largest share at 25.5%, while automobile manufacturers, restaurants and home improvement retail round off the next three spots.
VCR charges investors 10 bps in annual fees, while volume is moderate at nearly 48,000 shares a day. The product has managed about $5.4 billion in its asset base and currently 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 $19 billion and an average daily volume of around 4 million shares. Holding 52 securities in its basket, Amazon takes the top spot with 23.7% of assets. Broadline retail, hotels, restaurants & leisure, specialty retail and automobiles are the top four sectors with double-digit exposure each.
VanEck Vectors Retail ETF provides exposure to the 26 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 21.5% share.
VanEck Vectors Retail ETF has amassed $205.3 million in its asset base and charges 35 bps in annual fees. It trades in a lower volume of 5,000 shares a day on average. VanEck Vectors Retail ETF presently has a Zacks ETF Rank #2 with a Medium risk outlook.
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ETFs to Tap Amazon's Q1 Earnings Beat, AI Growth
After the closing bell on Thursday, Amazon (AMZN - Free Report) reported robust first-quarter 2024 results, wherein it beat both earnings and revenue estimates driven by growth in its advertising and AI-powered cloud computing units. The company provided soft guidance for the second quarter.
Shares of AMZN rose as much as 5% in aftermarket hours on elevated volume before declining to around 2%. Investors may tap the strength with ETFs having 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) .
The e-commerce giant reported earnings per share of 98 cents, outpacing the Zacks Consensus Estimate of 82 cents and the year-ago earnings of 31 cents. Revenues grew 13% year over year to a record high of $143.3 billion and edged past the consensus estimate of $142.5 billion. New generative AI features in its cloud and e-commerce businesses spurred robust growth (read: 4 ETFs to Tap the Renewed AI Craze on Wall Street).
Amazon’s cloud computing business — Amazon Web Services (“AWS”) — revenues soared 17% year over year to $25 billion, marking the highest growth in four quarters. The growth in AWS was accelerated by AI capabilities, and it is now on track for $100 billion in annual revenues. The online retailer has increased its investment in the AI startup Anthropic, pouring in another $2.75 billion in March to bring its total investment to $4 billion. Meanwhile, advertising revenues grew 24% year over year to $11.82 billion.
The world's largest online retailer expects revenues in the range of $144-$149 billion for the second quarter of 2024, implying year-over-year growth of 7-11%. The Zacks Consensus Estimate is pegged at $150.25 billion.
ETFs to Buy
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 18 stocks in its basket. Amazon is the top firm, accounting for 24% of the portfolio (read: E-Commerce Boosts U.S. Retail Sales: ETFs to Tap).
ProShares Online Retail ETF has amassed $95.9 million in its asset base and currently trades in a moderate volume of around 16,000 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 285 stocks in its basket. Of these, Amazon takes the top spot with a 23% share.
Fidelity MSCI Consumer Discretionary Index ETF has amassed $1.4 billion in its asset base while trading in a good volume of around 78,000 shares a day on average. It charges 8 bps in annual fees from investors and currently has a Zacks ETF Rank #2 (Buy) 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 304 stocks in its basket. Of these, Amazon occupies the top position, with a 23.1% allocation. Broadline Retail takes the largest share at 25.5%, while automobile manufacturers, restaurants and home improvement retail round off the next three spots.
VCR charges investors 10 bps in annual fees, while volume is moderate at nearly 48,000 shares a day. The product has managed about $5.4 billion in its asset base and currently 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 $19 billion and an average daily volume of around 4 million shares. Holding 52 securities in its basket, Amazon takes the top spot with 23.7% of assets. Broadline retail, hotels, restaurants & leisure, specialty retail and automobiles are the top four sectors with double-digit exposure each.
Consumer Discretionary Select Sector SPDR Fund charges 9 bps in annual fees and has a Zacks ETF Rank #1 with a Medium risk outlook (read: Tesla Turnaround in the Cards? Bet on These ETFs).
VanEck Vectors Retail ETF (RTH - Free Report)
VanEck Vectors Retail ETF provides exposure to the 26 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 21.5% share.
VanEck Vectors Retail ETF has amassed $205.3 million in its asset base and charges 35 bps in annual fees. It trades in a lower volume of 5,000 shares a day on average. VanEck Vectors Retail ETF presently has a Zacks ETF Rank #2 with a Medium risk outlook.