Should You Buy Amazon Stock, Even Though It Has Badly Underperformed the S&P 500 and Nasdaq-100 Since Jeff Bezos Stepped Down as CEO?

Amazon has significantly underperformed the S&P 500 and Nasdaq-100 over the past five years since Andy Jassy took over as CEO, posting only 6.8% annualized returns. The company has lost cloud market share to Microsoft and Alphabet despite AWS remaining the largest provider, and e-commerce growth has slowed. However, recent improvements in AWS growth (28% last quarter), a $364 billion contracted backlog, and a promising AI chip business valued at potentially $50 billion suggest Amazon could turn around, with the stock now trading at a reasonable 29x forward earnings valuation.