Some investors, most notably Warren Buffett, prefer to buy shares of businesses they believe are undervalued. On the flip side, some investors want to own companies increasing their sales and profits rapidly.

The latter group hopes to achieve strong investment returns from their holdings. If this sounds like you, there's no need to look far to find a worthwhile opportunity. Here's the smartest growth stock to buy with $1,000 right now.

Online shopping

Investors are certainly familiar with Amazon (AMZN -0.72%). This business went from only selling books online to now offering shoppers virtually everything imaginable. Consumers can even buy new cars on the site.

Almost 40% of all online sales in the U.S. happen on amazon.com. That's light-years ahead of second-place Walmart, which has a much lower share.

That big lead isn't a shocker. Amazon's sizable investments over the years to bolster its logistics network and delivery capabilities all work to create an exceptional consumer experience.

As e-commerce spending continues to attract dollars away from brick-and-mortar retailers, Amazon is set to benefit. It's the go-to choice for fast and free shipping on many products.

Cloud computing

The cloud-computing platform Amazon Web Services (AWS) is a powerful growth driver for the overall business. AWS posted 19% revenue growth in 2024, bringing the yearly sales total to $107.6 billion. It's also the company's profit engine, generating an impressive 37% operating margin last year.

According to research from Goldman Sachs, sales in the cloud computing market will reach $2 trillion by 2030. As the clear leader in the industry, it's in a favorable position to benefit from the shift of information-technology spending from on-site to off-premises.

Artificial intelligence (AI) can also provide a boost, with businesses showing greater interest in acquiring the tools necessary to use this technology.

On the 2024 fourth-quarter earnings call, CFO Brian Olsavsky said: "During the fourth quarter, we continued to see growth in both generative AI and non-generative AI offerings as companies turn their attention to newer initiatives, bring more workloads to the cloud, restart or accelerate existing migrations from on-premise to the cloud, and tap into the power of generative AI."

Digital advertising

Amazon is becoming a leader in the digital advertising market by generating revenue from ads on its online marketplace, which had nearly 3.3 billion visitors in January. The company also shows ads on its streaming service, Prime Video.

Last year, the company brought in $56.2 billion in digital ad sales. That figure was up 80% in the last three years. Only Alphabet and Meta Platforms have a greater market share than Amazon. However, it's quickly rising up the ranks.

Revenue from digital advertising produces high margins. Over time, Amazon is poised to benefit because this segment could help drive earnings for the overall business.

Valuation

Amazon is a gargantuan operation, with a market cap of $2.1 trillion and annualized revenue of around $750 billion.

Online shopping, cloud computing, and digital advertising all still offer meaningful growth potential for Amazon in the years ahead. Wall Street sees revenue and earnings per share rising at compound annual rates of 9.9% and 19.7%, respectively, over the next three years. This is a strong outlook, particularly on the bottom line.

The valuation is reasonable, too, in my opinion. As of this writing, shares trade at a forward price-to-earnings ratio of 31.6. Given Amazon's dominance and potential to beat the market, it looks like the ultimate growth stock to buy with $1,000 right now.