Dan Loeb's Amazon Stake Moves: A Look At His Trading Shifts

Technology giant, Amazon.com, Inc. AMZN, which reported earnings last week, remains one of the top holdings in Dan Loeb's Third Point LLC portfolio.

However, Loeb has had a complex relationship with the stock, adjusting his stake multiple times over the past two years.

Stake History: The stock entered the investor’s top list when he held 4.1 million shares in the second quarter of FY23

The investor then raised the stake to 4.7 million in the third quarter of FY23, followed by trimming the shares to 4.2 million in the fourth quarter of FY23 and thereafter increasing the stock holding to 5.1 million in the first quarter of FY24.

Further, Loeb maintained the stake in the second quarter of FY24 but trimmed the stake to 3.7 million in the third quarter of FY24.

Earnings Results: On Feb. 6, the company reported fourth-quarter net sales of $187.8 billion, up 10% year-over-year (Y/Y), which beat a Street consensus estimate of $187.3 billion and EPS of $1.86, beating a consensus estimate of $1.48.

Amazon guided for first-quarter net sales to come in a range of $151 billion to $155.5 billion, up 5% to 9% Y/Y, which fell short of the consensus of $158.5 billion.

Amazon indicated a potential unfavorable impact of $2.1 billion due to foreign exchange rates in the first quarter. Additionally, it stated that the Leap Year could affect net sales by approximately $1.5 billion.

Several analysts boosted the price forecast for the company following strong fourth-quarter results, with RBC Capital analyst Brad Erickson maintaining an Outperform rating and raising the price forecast from $255 to $265.

Erickson said, “While the name is crowded and the AI ‘spend money to make money’ debate will undoubtedly continue, the combo of AWS’s high margin growth and further network cost efficiencies have the company poised to continue growing earnings at a level supportive of this valuation,”.

Meanwhile, DA Davidson analyst Gil Luria reiterated a Buy rating and upped the price forecast from $235 to $280, saying that “AWS winning in AI with better investment discipline,”.

Amazon's share has increased 38.02% in the last year, outperforming the Fidelity MSCI Consumer Discretionary Index ETF FDIS, which has surged 24.52%, but underperformed ProShares Online Retail ETF ONLN that witnessed a growth of 43.92% over the same time frame.

Compared to its top peers, Amazon shares underperformed Alibaba Group Holding Limited BABA, which grew 57.51%, but outperformed PDD Holdings Inc. PDD, which declined 8.96% and MercadoLibre, Inc. MELI, which rose 19.28% in the last one year.

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