Amazon became the second member of the $1 Trillion Club this morning – then left it after stock prices dipped.
Amazon crossed the threshold at $2050.27, five weeks after Apple was first to reach $1 trillion. By early afternoon, Amazon shares were trading at $2,035.64.
Still, the brief appearance in the club (and the day is not over just yet) is a major milestone for the e-commerce giant. Stock in Amazon has gained more than 70 percent this year and more than doubled in the last 12 months, according to CNBC.com.
Analysts say Amazon’s growing portfolio – including the purchase of Whole Foods Markets last year – is driving the company’s value at a meteoric pace. Amazon cloud services grew by nearly 50 percent in the second quarter, generating more revenue than rivals Google and Microsoft, CNBC reported.
“Yes, Amazon did really well in online retail, but then the stock gapped up when they showed that they could become successful in the cloud,” RBC Capital Markets analysts Mark Mahaney told CNBC.
Loup Ventures’ Gene Munster said Amazon’s diverse portfolio has “given investors confidence that they can go and disrupt (other) markets just like they’ve done with retail.”
But Munster believes Apple will continue to outperform Amazon because of its pursuit of world-changing technology, such as autonomous driving. Other analysts say Amazon’s growing web services business alone with reach $1 trillion and by 2024, its value could be as high as $2.5 trillion.
Apple hit the $1 trillion value on Aug. 2 with a share price of $207.05. As of 1 p.m. ET today, Apple shares were past $228.