Jeff Bezos To Sell Another $5 Billion In Amazon Shares: How Could He Spend It?

Whenever the billionaire founder of a company sells off some shares, eyebrows are raised. What could it mean? Is it a sign of trouble? SEC filings recently revealed that Jeff Bezos, the former CEO and current executive chair on the board of directors at Amazon AMZN, plans to sell 25 million shares worth approximately $5 billion. Investors may wonder if that’s a bad sign, and Bezos watchers may be curious about where the money might go next. 

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The good news for investors is that Bezos isn’t jumping out of Amazon. These 25 million shares represent just a tiny part of his stake in the company, which is around one billion shares. That works out to around $220 billion. Bezos might just be taking advantage of an opportunity. Amazon stock was down in 2023 and has spent much of the spring and summer on a steady upward climb, hitting a 52-week high recently. Why not celebrate by taking a little off the top? And with another successful Prime Day event under Amazon’s belt, it seems like a good time to sell a little with the confidence that the rest will keep going up. Where might Jeff Bezos put $5 billion to good use?

Let's Get Spending

Bezos may have earned his billions through Amazon, but he’s not shy about spending them elsewhere. Aside from yachts, travel, and luxury goods, there are two main areas where we have seen Bezos devote a lot of money: real estate and investing. 

He could always buy more real estate. He has spent $237 million on three properties on Indian Creek Island, the elite Florida area known as the Billionaire Bunker. Bezos and his fiancee, Lauren Sanchez, have decided to make the Miami area their home base. For a billionaire, no property is perfect. Like his neighbor Tom Brady, Bezos plans to make major renovations, tearing down two of the mansions he owns on the island and living in the third while he plans what is likely to be another incredible home. 

He still owns his custom-built home on Lake Washington in Seattle and several other properties in the Washington area. And he enjoys the other Washington as well. When he bought the Washington Post, he picked up two homes in the Kalorama neighborhood, including a former textile museum, which he is completely remodeling. His New York City holdings include multiple prime Fifth Avenue building floors. No tech billionaire is caught without a Hawaii hideaway, and Bezos has one of those, too, a pristine estate in Maui. What's missing? A pied-à-terre in Paris, perhaps? A ski home in Jackson Hole, WY? The possibilities, like Bezos's wallet, are nearly endless. 

He could and probably will invest again. Bezos doesn't just bet on himself and Amazon. He has made dozens of investments through his Bezos Expeditions investment firm, including the Washington Post and his space exploration company, Blue Origin. One of the reasons Bezos stepped down from his CEO role at Amazon was to spend more time at Blue Origin. That move paid off and accelerated the company's growth even as Bezos battled with space rival Elon Musk. Blue Origin recently filed a complaint to curb the number of rockets that SpaceX can launch from Cape Canaveral.

Bezos doesn't have to own a company to invest in it. Bezos Expeditions has strategically invested in now-public companies like Airbnb ABNB and Uber UBER. He is also an active venture capitalist supporting various private companies from Arrived to Wildtype. We can only imagine how many pitch decks and presentations he receives regularly, but his existing investments show he has many interests beyond space travel. 

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Should You Sell, Too?

Selling a stock is always a personal decision. If you need the money or spot a more compelling investment, this isn't a bad time to sell Amazon, especially if you have held it for a while and are ready to put those gains elsewhere. However, you should remember that, like Bezos, you may be subject to some capital gains taxes. 

An argument could also be made that this isn't a great time to sell Amazon because it may continue to go up from here. With a thriving e-commerce empire, the power of the AWS cloud business, and Amazon's forays into generative AI, it could be argued that Amazon is just getting started. Analysts agree. According to Benzinga data, Amazon is a buy with a consensus price target of $216.7 based on the ratings of 40 analysts. Recently, Wolfe Research initiated coverage with an Outperform rating. 

While Amazon's next earnings results on August 1 won't give us insights into how well the latest Prime Day event did, it will provide key updates on the growth of the cloud and e-commerce businesses and other segments, including media and advertising. In Amazon's shareholder letter earlier this year, CEO Andy Jassy laid out the opportunities for Amazon, noting that even as Amazon has created a $500 billion consumer business, about 80% of the worldwide retail market segment still resides in physical stores. He also sees a massive advantage in cloud migration, growing media and advertising, and generative AI, which he said “may be the largest technology transformation since the cloud (which itself is still in the early stages), and perhaps since the Internet.” No stock is a sure thing, but those are some reasons that Amazon may be a hold for more than just Jeff Bezos. 

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