Amazon.com Inc. shares closed lower than their March 2020 nadir for the first time Thursday, as the tech giant’s stock heads for its worst year since the dot-com bust.
Amazon AMZN, -3.43% shares fell 3.4% on Thursday to $83.79, their lowest closing price since March 12, 2019, on the second-highest daily volume in the S&P 500 index SPX, -1.45%, behind only Tesla Inc. TSLA, -8.88%. Amazon is the 45th S&P 500 stock to eclipse its 2020 closing low since the beginning of the COVID-19 pandemic, and one of only 26 to close below that figure on Thursday.
Amazon shares are down nearly 50% so far this year, at 49.7%, while the S&P 500 has declined 18.6% and the Dow Jones Industrial Average DJIA, -1.05% has fallen 8.2%. It would be Amazon’s second-worst year on record, behind only the dot-com-bust year of 2000, when Amazon stock declined 79.6%.
Amazon is headed for a loss on the year after putting up profit of nearly $55 billion collectively in 2020 and 2021, though it would be on course for profit without accounting for losses stemming from its investment in Rivian Automotive Inc. RIVN, -6.18%. Revenue growth has also slowed tremendously this year, and Amazon has begun trimming costs and its workforce after years of phenomenal increases.
Amazon’s e-commerce business is expected to produce roughly flat revenue in 2022 from 2021, as a boom in online sales during the first two years of the pandemic flattens out. The company’s cloud-computing division — Amazon Web Services, or AWS — has exhibited a slowdown in revenue growth as well, while continuing to provide the majority of Amazon’s operating profit.
Amazon stock ended the day with a market capitalization slightly shy of $855 billion, after falling out of the trillion-dollar club early last month. Only three public U.S. companies are currently worth more than a trillion dollars — Apple Inc. AAPL, -2.38%, Microsoft Corp. MSFT, -2.55% and Alphabet Inc. GOOGL, -2.03% GOOG, -2.20%
Wall Street is still bullish on Amazon’s chances to reverse its slide, however. Out of 54 analysts tracked by FactSet, 49 have the equivalent of a “buy” rating on the stock, with four “hold” ratings and a single “sell.” Analysts’ average target price as of Thursday was $134.64, according to FactSet, more than 60% higher than the going rate.
