On June 7, 2023, Adam Selipsky, CEO of Amazon Web Services, sold 1,000 shares of Amazon.com Inc (AMZN, Financial). This recent insider sell has caught the attention of investors and analysts alike, prompting a closer look at the company's stock performance and valuation.
Adam Selipsky has been with Amazon.com Inc since 2005 and was appointed as the CEO of Amazon Web Services in 2021. Amazon.com Inc is an American multinational technology company that focuses on e-commerce, cloud computing, digital streaming, and artificial intelligence. It is one of the world's largest online retailers and a prominent cloud services provider.
Insider Trading Analysis
Over the past year, Adam Selipsky has sold a total of 69,120 shares and purchased 0 shares. The insider transaction history for Amazon.com Inc shows that there have been 1 insider buy and 44 insider sells over the past year. This data can be visualized in the following insider trend image:
It is important to analyze insider buy/sell transactions and their relationship with the stock price. Insider selling can sometimes indicate a lack of confidence in the company's future prospects, while insider buying can signal optimism. However, it is also essential to consider other factors, such as personal financial needs or portfolio diversification, when interpreting insider transactions.
Valuation
Shares of Amazon.com Inc were trading for $124.95 apiece on the day of Adam Selipsky's recent sell. This gives the stock a market cap of $1,271,001.316 billion.
The price-earnings ratio is 294.94, which is higher than the industry median of 16.46 and higher than the company's historical median price-earnings ratio.
With a price of $124.95 and a GuruFocus Value of $199.62, Amazon.com Inc has a price-to-GF-Value ratio of 0.63. This means the stock is significantly undervalued based on its GF Value. The GF Value can be visualized in the following image:
The GF Value is an intrinsic value estimate developed by GuruFocus that is calculated based on the following three factors:
- Historical multiples (price-earnings ratio, price-sales ratio, price-book ratio, and price-to-free cash flow) that the stock has traded at.
- A GuruFocus adjustment factor based on the company's past returns and growth.
- Future estimates of business performance from Morningstar analysts.
In conclusion, while the recent insider sell by Amazon Web Services CEO Adam Selipsky may raise some concerns, it is essential to consider the overall valuation and performance of Amazon.com Inc. The stock appears to be significantly undervalued based on its GF Value, and the company's strong market position and growth potential should not be overlooked. Investors should continue to monitor insider transactions and other relevant factors to make informed decisions about their investments in Amazon.com Inc.
