We recently published a list of 12 Best QQQ Stocks to Invest in Now. In this article, we are going to take a look at where Amazon.com Inc. (NASDAQ:AMZN) stands against other best QQQ stocks to invest in now.

Lunch’ to analyze the market’s reaction to the tariff announcements. McCartney referred to the situation as tariff policy ping pong, and highlighted how it adds to the uncertainty in Washington during a time when weak data is emerging from other areas. She explained that this has created a perfect storm of challenges, which includes seasonal pressures that make this time of year difficult. Retail buyers have stepped away from the market, and there is uncertainty for individuals regarding tax policy and for corporations concerning tariffs and taxes. The withdrawal of overleveraged bids has contributed to increased market volatility, which makes it harder for major tech companies to maintain their leadership roles.

The conversation then turned to the influence of key sectors, particularly the MAG7. McCartney noted that when these sectors underperform, they can generate downside pressure on the market, which contrasts with the desire for a broader market trade. She pointed out that while these tech stocks are down year-to-date, the overall market remains materially up and is annualizing at a high single-digit rate. She expressed optimism about market breadth and suggested that this could present a buying opportunity for investors to re-enter big tech.

Tech stocks face short-term volatility due to market uncertainty, but their long-term potential remains intact.

Methodology

We sifted through the Invesco QQQ exchange-traded fund (ETF) holdings to find 12 stocks that were the most popular among elite hedge funds and that analysts were bullish on. The stocks are ranked in ascending order of the number of hedge funds that have stakes in them, as of Q4 2024. The hedge fund data was sourced from Insider Monkey’s database which tracks the moves of over 900 elite money managers.

Why are we interested in the stocks that hedge funds pile into? The reason is simple: our research has shown that we can outperform the market by imitating the top stock picks of the best hedge funds. Our quarterly newsletter’s strategy selects 14 small-cap and large-cap stocks every quarter and has returned 373.4% since May 2014, beating its benchmark by 218 percentage points (see more details here).

Amazon.com Inc. (NASDAQ:AMZN)

A customer entering an internet retail store, illustrating the convenience of online shopping.

Number of Hedge Fund Holders: 339

Amazon.com Inc. (NASDAQ:AMZN) is a global e-commerce and technology giant. It operates through its North America, International, and Amazon Web Services (AWS) segments. It engages in retail sales, cloud computing, digital streaming, and AI. Its products and services include e-commerce, cloud infrastructure, digital content, and consumer electronics.

On February 27, TD Cowen analyst John Blackledge reiterated a Buy rating on the company with a $265.00 price target. The analyst highlighted the company’s recent launch of GenAI-powered Alexa+ assistant, which emphasizes its impact across Amazon Web Services (AWS), eCommerce, and advertising. Blackledge forecasts AWS’s GenAI revenue to grow from $7.1 billion in 2025 to $56.3 billion in 2030.

AWS revenue hit a $115 billion annual run rate in Q4 2024, which was up 19% year-over-year. Customers are moving to the cloud to use AI and driving demand. The company’s own AI chips, Tranium 2, are 30-40% cheaper than competitors. So they attract big clients like Anthropic. Amazon Bedrock is a key AI service, which offers various AI models. Amazon Q, which is an AI assistant, is saving companies time and money and showcases practical AI use. AWS is heavily investing in data centers for AI and expecting similar spending in 2025.

RiverPark Large Growth Fund stated the following regarding Amazon.com Inc. (NASDAQ:AMZN) in its Q4 2024 investor letter:

“Amazon.com, Inc. (NASDAQ:AMZN): Amazon was our top contributor in the fourth quarter following third quarter results of slightly better than expected revenue and much stronger than expected operating income. 3Q operating income of $17.4 billion exceeded company guidance of $11.5-15 billion (and Street estimates of $14.7 billion), driven by margin expansion across all three major segments, including gross/net margins of 38% at AWS, up from 30%. In addition, the company reported an acceleration in e-commerce demand both domestically and internationally, and accelerated growth of Prime paid memberships. The company guided to 4Q operating income of roughly $18 billion driven by the same positive factors that impacted 3Q.

With its ability to continue its market share gains in its three leading businesses (e-commerce, web services and online advertising), plus a multi-year operating margin expansion opportunity (from improved e-commerce margins and greater contribution from the faster growing, higher margin AWS and advertising segments), we believe Amazon remains one of the best-positioned global growth companies in the world.”

Overall, AMZN ranks 1st on our list of best QQQ stocks to invest in now. While we acknowledge the growth potential of AMZN, our conviction lies in the belief that AI stocks hold great promise for delivering high returns and doing so within a shorter time frame. If you are looking for an AI stock that is more promising than AMZN but that trades at less than 5 times its earnings, check out our report about the cheapest AI stock.

READ NEXT: 20 Best AI Stocks To Buy Now and 30 Best Stocks to Buy Now According to Billionaires

Disclosure: None. This article is originally published at Insider Monkey.