If You Invested $1,000 In Amazon Stock At IPO, Here's How Much You'd Have Today

Founded in 1995 as an online seller of books, Amazon.com Inc AMZN is now a worldwide e-commerce leader worth nearly $2 trillion. But 20 years ago, the Seattle-based company was unprofitable and valued at less than $1 billion.

Here's a look back at the Amazon IPO and how many investors could have made investing in the company founded by Jeff Bezos.

What Happened: Amazon was founded in 1995 by Bezos, who quit his job at an investment firm to open an online bookstore company. Bezos moved to Seattle to create Amazon.com and drafted the initial business plan during his cross-country trip from New York to Seattle.

The first item sold on Amazon was a science textbook called "Fluid Concepts & Creative Analogies: Computer Models of the Fundamental Mechanisms of Thought." The company beat estimates from the start, doing over $20,000 in weekly sales two months after launching.

On May 15, 1997, Amazon went public with an initial price offering. The company offered shares at a price point of $18 and a company valuation of around $300 million.

At the time of its IPO, the "Leading online retailer of books" had around 80,000 average daily visits to its website, annual revenue of $15.8 million and 340,000 customer accounts from 100 countries.

Today, Amazon is the fifth most valuable public company in the world, valued at $1.82 trillion at the time of writing.

Amazon has grown from an online bookseller to an e-commerce leader and also expanded into new product offerings like Amazon Prime Video and Amazon Web Services and also expanded internationally. Amazon's aggressive acquisition strategy over the years included notable purchases such as Alexa, Audible, MGM, Pill Pack, Twitch, and Whole Foods.

While Bezos stepped down as the CEO of the company in 2021, he remains the executive chairman of the company. He also owns a stake in the company and has seen his wealth rise with Amazon's increased valuation.

On Monday, Feb. 26, Amazon.com was added to the Dow Jones Industrial Average, one of the key stock market indices. Amazon replaced Walgreens Boots Alliance Inc WBA in the index. The Dow Jones Industrial Average, which includes 30 stocks, now includes Amazon, Apple Inc and Microsoft Corporation, which are all valued at more than $1 billion based on market capitalization.

The SPDR Dow Jones Industrial Average DIA, which tracks the Dow Jones Industrial Average, is up 18% over the last year and up 50% over the last five years.

The last changes for the components of the Dow Jones Industrial Average happened in 2020.

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Investing $1,000 in Amazon Stock: Investors who bought Amazon shares at the time of the company's IPO have done quite well, even though they would have also had to weather the dot-com bubble.

A bubble of tech companies, including many dot-com names, wiped out competitors of Amazon and also saw shares of the ecommerce company fall significantly.

Investors who were patient and weathered the storm turned a small investment into a huge win.

At the time of its IPO, investors could have bought 55.56 shares of Amazon stock based on the $18 price point.

Stock splits of Amazon in June 1998 (2:1), January 1999 (3:1), September 1999 (2:1) and June 2022 (20:1) would have turned 55.56 shares into 13,334.4 shares today.

Based on a price of $175.52 for Amazon shares at the time of writing, the $1,000 investment would be worth $2,340,453.89 today.

Not a bad return for investing $1,000 in an unprofitable online bookseller.

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