Amazon famously rose to prominence in the early 2000s and quickly became one of the largest and most powerful companies in the world. Founder Jeff Bezos is now the richest man in the world, and Amazon has completely changed standards for both e-commerce and brick and mortar retailers.
This growth also meant that their stock price skyrocketed. Investors who bought Amazon before it took off saw massive returns. It’s currently the second-most valuable technology company in the world, behind Apple and ahead of Google, Microsoft, and Facebook.
Because Amazon has been so successful, investors have been on the hunt for a stock that could become the next Amazon. While it’s impossible to predict exactly what will happen on the stock market, there are some companies that are particularly promising. We’ve rounded up stocks that many investors think could be the next Amazon.
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Next Amazon Stock To Buy
MercadoLibre (NASDAQ: MELI)
If you’re looking to invest in stocks with a similar business model to Amazon, MercadoLibre could be a good option. MercadoLibre is a massive online marketplace that has become very popular in Argentina and other Latin American countries.
This company has a broad range of online operations. Their online marketplace and auction houses match buyers and sellers for a variety of different products. They also run online classifieds for cars and real estate.
They’ve also expanded into fintech with a payment processing system. This payment processing system has a mobile app that retailers can use with a phone or tablet in brick and mortar establishments.
It’s important to note that MercadoLibre stock is already very expensive, and they have a high market cap of 68.55 billion. This means they may not be accessible to every investor, and the ceiling for their growth is lower than Amazon’s was.
However, the stock has dipped after hitting a peak in February. This means it could be a good opportunity for investors to add this company to their portfolio while it’s down. MercadoLibre focuses on a growing Latin American market with huge potential, so there are plenty of ways that the company could continue to expand.
Alibaba (NYSE: BABA)
Alibaba is a stock that is often compared to Amazon due to their similar business model. They are a technology company based in China that runs a massive e-commerce platform and offers a variety of services including cloud computing, digital payments, and even artificial intelligence.
Like MercadoLibre, Alibaba is a stock that’s already risen to prominence. This means you’re probably not going to see the same massive gains with this stock as early shareholders did.
Because Amazon had already been so successful by the time Alibaba went public, there was a lot of hype around the company. They had the largest IPO in the world at the time, valued at $231 billion.
Alibaba has had some shortcomings in the past year, and investors should be aware of this before they buy. In December 2020, Chinese market regulators started investigating Alibaba for their monopolistic practices.
Alibaba’s founder and former CEO, Jack Ma, was also in the process of launching a second IPO for Ant Group, but the government halted this as well. After this government crackdown, Ma vanished from public view.
All of these things gave investors concern and caused Alibaba’s stock price to drop. However, Alibaba still posts massive sales and revenue growth numbers.
The Chinese market has huge potential, and investors are just starting to realize the power that some of the most prominent Chinese companies have. Although Alibaba may have had some struggles recently, they’re still one of the largest companies in the world in terms of sales.
After peaking in October, Alibaba stock has been consistently dropping in price. However, if the company can continue their revenue and sales growth, it wouldn’t be surprising to see their stock go back up again. Buying now could be a chance for investors to grab it while it’s still affordable.
Pinterest (NYSE: PINS)
Pinterest is a unique social media network and media platform. It allows users to save, curate, and share content from around the internet that they are interested in. Pinterest has been growing slowly but surely over the past few years. Some investors think it could be the next Amazon – a tech company with lots of room to grow in the future.
Pinterest’s user growth has been steady in the U.S., but they’ve been focusing on expanding into international markets. They haven’t fully maximized their opportunity for ad revenue yet, as they currently only display ads to users in specific countries.
There are plenty of ways that Pinterest could expand their revenue stream. Right now, Pinterest delivers their ads in the form of promoted pins. However, they could expand into video content and other types of ads to increase their cash flow.
Pinterest could also easily expand into e-commerce, which could help them appeal to a larger audience. Giving creators the ability to sell their products directly on the platform could be an excellent source of revenue for them. The company has expressed interest in developing an e-commerce platform, but hasn’t released any specific plans yet.
Pinterest’s stock price has grown significantly over the second half of 2020. This growth has slowed over the past few months as the market has been bearish on tech stocks in general. However, their most recent earnings report indicated positive revenue growth. Now could be a good time to buy this stock while it’s down and a bit more affordable.
The RealReal (NASDAQ: REAL)
The RealReal is a luxury consignment company. While most of their operations are through their e-commerce platform, they do have 11 brick and mortar locations in major cities throughout the U.S. All of the items they sell are authenticated by in-house experts.
This company has a unique appeal because they focus on making luxury goods accessible. They cater to a niche market, but they have a loyal following that tends to make repeat purchases. Since their inventory is updated regularly, customers are incentivized to come back and search for new deals on a regular basis.
This stock went public in 2019 and hit a peak in January 2020 during a time of extreme market volatility. However, their stock price dropped significantly at the beginning of May. Part of this drop was due to the company’s most recent earnings report. While their sales and revenue numbers were positive, their bottom line didn’t meet analyst’s expectations.
However, this doesn’t mean you should write this stock off. The company’s overall sales growth has been consistent. While they cater to a niche market, they do have the potential to expand their business model in the future and sell other items.
Now that this stock has dropped, it could be a good opportunity to pick it up while it’s at an affordable price. The RealReal is a relatively new company and still has plenty of time to grow and become profitable in the future. They also could effectively capitalize on e-commerce trends that Amazon started as they continue to grow.
Square (NYSE: SQ)
Square is a fintech company based in San Francisco. Their products give small businesses an easy way to process payments from their customers. The Square Reader and Square Stand turn tablets and smartphones into payment processing systems. They take Apple Pay and other contactless payments.
Over the past few years, Square has proven their ability to successfully expand their business, just as Amazon has. They’ve launched the Cash App for peer-to-peer payments. They’ve also launched Square Capital and Square Payroll, which offer business financing and payroll management.
They’ve also recently developed a Kitchen Display Software, which provides digital ticket timers and other kitchen tools. As the COVID-19 pandemic comes to an end, restaurants are starting to open, which should create steady demand for this new product.
Square stock has had a meteoric rise over the past year. This is a business that has the potential to continue expanding and growing for the future. The stock has plenty of room to continue growing.
Airbnb (NASDAQ: ABNB)
Airbnb is a company that completely changed the travel industry. They’ve developed a global marketplace for vacation rentals. The site also offers guided tours and experiences.
The company went public in December 2020, and there was plenty of hype leading up to their IPO. Their stock price quickly rose to a peak in February, but has since dropped as tech stocks in general have corrected.
Since the COVID-19 pandemic is slowing in many countries, demand for travel is going up significantly. This means there will likely be a significant increase in sales for Airbnb over the rest of the year.
Airbnb offers unique lodging options that are hard to find anywhere else. It has put pressure on the hotel industry in a way that other travel companies haven’t quite managed to do. Their market share and unique business model make them a long-term stock pick that could offer huge returns in the future.
Also Read: Motley Fool Rule Breakers Review
So, What Is The Next Amazon Stock?
The unpredictable nature of Wall Street means it’s virtually impossible to determine exactly what the next Amazon stock could be. Many expert investors also have differing opinions, which means that there isn’t currently a consensus opinion about which stocks could become the next Amazon.
However, there are certain characteristics to watch for that indicate that a company has the potential to scale and grow the way that Amazon has. One of the most important of these characteristics is the ability to scale their business in a way that sets them up for future revenue growth.
One of the things that has made Amazon so successful is that they have been able to expand their business to cater to a very wide variety of customers. They are best known for their delivery services, but they also offer web hosting through AWS, sell groceries through Whole Foods, develop popular movies and TV shows, and sell their own technology products.
They were able to scale their business even more during the COVID-19 pandemic last year. They did this by adapting to customers’ changing needs. Companies that have the ability to adapt quickly are more likely to stay relevant in a rapidly changing economy.
In addition to looking at a company’s business model, you may also want to look for stocks that currently have a relatively small market cap. A smaller market cap means more potential for massive returns in the future as the company gains value. If a company’s market cap is already too large, there’s not as much room for it to grow.
Should You Buy The Next Amazon Stocks?
There’s a reason why the investments on this list have been touted as the next Amazon – investors around the world have seen potential in both their business model and their finances. Whether these companies actually see the same growth as Amazon has yet to be seen. However, they have the fundamentals of a good long-term investment, making them a good option to add to your portfolio.
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Next Amazon Stock: Final Thoughts
Amazon’s meteoric rise has been studied by stock market experts and entrepreneurs alike. There’s huge potential in some of these up-and-coming companies to reach the same level of success in the future. Investing in them while they are still affordable could set you up for very strong returns in the years to come.
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