Monthly Archives: April 2021

Senator Josh Hawley of Missouri accuses the USs biggest tech companies of committing the gravest threat to American liberty since the monopolies of the Gilded Age in his upcoming book. He rails that tech giants Amazon, Google and Facebook have become a techno-oligarchy with overwhelming economic and political power.

Hawley has also invested potentially tens of thousands of dollars in the very companies he denounces, according to public financial disclosure records examined by the Guardian.

Hawleys new book, The Tyranny of Big Tech, is published next week by Regnery Publishing. Simon & Schuster, its original publisher, dropped the book following the Missouri senators involvement in the 6 January electoral college vote certifying Joe Bidens election.

In the book, Hawley compares todays tech titans to the robber baron industrialists who dominated the US economy in the 19th century, whose monopoly powers were attacked by Theodore Roosevelt, the subject of a previous Hawley book.

Theodore Roosevelt had balked at the monopolies of his day that had consolidated power and crowded out the common man, but the the robber barons power over everyday Americans was nothing compared to was nothing compared to that wielded by big tech, Hawley writes.

But according to Senate financial disclosures, the senators disdain for big tech does not extend to his investment portfolio.

Hawley and his wife each have somewhere between $1,000 and $15,000 invested in Vanguard Growth Index Fund ETF, which has holdings in Google parent Alphabet, Amazon, Apple and Facebook. The disclosures do not offer exact amounts of holdings, only a range.

The Hawleys held considerably more cash in Vanguard funds in 2018, according to his disclosures. The couple held between $50,001 and $100,000 in Vanguard Dividend Appreciation ETF, between $50,001 and $100,000 in Vanguard Growth ETF and another $50,001 to $100,000 in Vanguard Value ETF.

Hawley is a long-time critic of tech power. Before taking his seat in the Senate in 2019 he was Missouris attorney general and opened investigations into Facebook, Google and Uber.

Its not unusual for senators to have mutual funds while serving in Congress or for lawmakers to have investments in individual stocks. But its a counterintuitive decision for Hawley. The Missouri senator, educated at Stanford University and Yale Law School, has made fighting big tech one of his signature issues. Hes also been mentioned as a potential 2024 presidential candidate. Hawley is one of a number of young Republican senators who have prioritized rebranding the Republican party as a nemesis of big tech, China and aspiring populist champion of the American working class.

Hawley drew criticism for leading the charge of congressional lawmakers in early January seeking to challenge Bidens victory over Donald Trump in the 2020 presidential elections. That push incited a violent riot at the Capitol where Trump supporters broke into Congress.

In a statement to the Guardian, a spokesperson for Hawley said: The Hawleys dont own any stock. They have their savings in mutual funds. Some politicians enrich their families by landing them board seats on Ukrainian oil and gas companies and multi-million dollar salaries but the liberal media insists that isnt newsworthy. But if youre a Republican, just investing in mutual funds just like millions of hardworking Americans do is considered controversial.

The disclosures also show that Hawley is invested in another of his persistent targets: China.

Hawley has between $1,000 and $15,000 invested in iShares MSCI Emerging Markets ETF, which holds stakes in some of Chinas biggest companies, including Alibaba, Ping An Insurance group and Tencent.

According to the New York Times, Alibabas cloud computing business showed its clients how they could use its software to detect the faces of Uyghurs and other ethnic minorities currently being persecuted.

Last year Hawley launched an attack on China, claiming imperialist China seeks to remake the world in its own image, and to bend the global economy to its own will.

For decades now, China has bent, and abused, and broken the rules of the international economic system to its own benefit, he said in a Senate speech.

They have stolen our intellectual property and forced our companies to transfer sensitive trade secrets and technology. They have manipulated their currency and cheated time and again on their trade commitments. They have been complicit in the trafficking of persons and relied upon the forced labor of religious minorities, he said.

Continue reading here:

Josh Hawley rails at big tech firms but records show he has invested in them - The Guardian

This article first appeared in the Morning Brief. Get the Morning Brief sent directly to your inbox every Monday to Friday by 6:30 a.m. ET. Subscribe

Thursday, April 29, 2021

This week represents the apex of first quarter earnings season with Microsoft (MSFT), Alphabet (GOOGL), Apple (AAPL), and Facebook (FB) all having reported results in the last two days.

Each of these businesses helps us think both narrow and broad about the state of the economy, the tech industry, and consumer behavior, among other things.

But a top of mind concern these companies have also helped shape is what the return to office life is both looking like right now and might look like in the future. And some commentary that stood out to us came from Google CFO Ruth Porat on the company's Tuesday evening earnings call.

Asked about capital expenditures and anticipated investment intensity around personnel and facilities, Porat said, in part, "We've been very clear we do value bringing people together in the office, and we're looking at a hybrid work-from-home, work-from-office model."

But fewer people in offices less often doesn't mean there will be either fewer offices or even smaller ones.

"We are looking at less density per employee," Porat added. "So even with a hybrid work environment, we will continue to need [office] space, and so we're continuing to build out our campuses and office facilities."

Given that consensus expectations for the future of work have become centered around some kind of hybrid model, it's not a total surprise to see Google thinking along these lines. A report from the World Economic Forum published earlier this week said 65% of those working remotely due to the pandemic would like to remain remote. These preferences are so firm that some 58% of workers working remotely said they'd find another job if required to return to an office with pre-COVID expectations.

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Microsoft, which like Google builds and sells software that helps enable a lot of these hybrid arrangements, noted that, "In market where employees have returned to the workplace, including Australia, China, New Zealand, South Korea, and Taiwan, we have seen [Teams] usage continue to grow."

Microsoft CEO Satya Nadella also referred to the current environment as a "new era" of hybrid work.

But we note Google's investment in its campus because of the influence it has had on multiple generations of companies and how they view the in-office experience.

Earlier this week, tech commentator Ben Thompson explored the transforming relationship between employees and employers in the tech industry. A relationship that today works off the template set by Google's Mountain View campus, which Thompson notes, "became the standard for Silicon Valley companies, from Facebook on down."

"Employers didnt simply offer free lunches, but also free dinners, and everything in between, from transportation to snacks to laundry services," Thompson adds. "Employees, meanwhile, were expected to bring their whole selves to work, by which founders meant a willingness to work long hours and accept lower salaries in exchange for stock options and the chance to 'do your lifes work.'"

Google's view, then, that a physical office will remain a part of but only a part of your professional identity represents a massive shift. Hollywood made movies that did little but showcase Google's modern corporate campus lifestyle. Companies like WeWork were founded to explicitly offer smaller companies a flexible way to approximate the perks of a Google-like office: free food, free drinks, low couches, common spaces.

But Google and its leading tech peers now seem to believe employee expectations revolve not around the perks of going to work but the perks of staying home. And if that prior cultural moment asked workers to bring, as Thompson notes, their "whole selves" to work, one wonders if we're increasingly asked to keep most of ourselves at home. And what might we all think of work then.

By Myles Udland, reporter and anchor for Yahoo Finance Live. Follow him at @MylesUdland

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The future of work according to big tech - Yahoo Tech

The public spat between Facebook and Australia earlier this year presages a new effort to regulate big tech companies but could that threaten the whole future of the web?

By Chris Stokel-Walker

Marcus Marritt

STAND-OFFS between nations are nothing new. But a very public spat between a government and a commercial company, in which each accused the other of taking citizens hostage and threatened sanctions, certainly seemed novel when it broke out this February.

This was the case of Facebook versus Australia, in which the tech giant briefly cut off access to some parts of the web through its platform for its 17 million Australian users, in response to a proposed law that would force it to pay for linking to news stories. Opinions are still divided on the rights and wrongs but this skirmish looks like just a foretaste of bigger battles to come.

Across the world, governments are concluding that tech giants such as Facebook and Google exercise too much power and are undermining the public good by allowing hate speech and misinformation to proliferate. Not only in Australia, but also in the UK, the US, the EU and elsewhere, plans are afoot to bring them to heel.

That determination brings with it risks, though. Clamp down too hard and you can damage freedom of expression, and send out the wrong signals to authoritarian regimes worldwide. Bring in different rules in different places and you risk Balkanising the internet, destroying the universality on which it is built. Not even the tech companies deny that something should be done. The question is, what?

Big tech has certainly become big. Facebook, Google and other tech companies incomes have ballooned as they have benefited from the changing ways we communicate and access information and services. If Facebooks $86 billion revenue in 2020

Read more here:

Facebook vs Australia and the new battle to cut big tech down to size - New Scientist

FOX Business' Stuart Varney weighs the pros and cons of Big Tech and its impact on peoples lives.

FOX Business'Stuart Varney, during his latest "My Take" on"Varney & Co.,"reflected on Big Tech and the impact it has on peoples daily lives.

STUART VARNEY: Big Tech gets a lot of criticism: Too powerful, they squash competition, too much money, they censure free speech.

VARNEY: WELCOME TO 'TAX THE RICH WEEK'

They are indeed dominant and the attacks come from both sides of the aisle.

But hold on a minute -- its not all bad! In fact, Apple, Amazon, Google, Microsoft and Facebook benefit us all.

GET FOX BUSINESS ON THE GO BY CLICKING HERE

Im generalizing, but, Amazon runs online shopping. Apple runs smartphones. Facebook runs a network that links one-third of the worlds population.Googleruns YouTube, the worlds go-to channel.[And] Microsoft, along with Amazon, runs the cloud, which is the worlds back office!

They are very good at providing these products and services. We all benefit. Its good to be plugged into the best!

CLICK HERE TO READ MORE ON FOX BUSINESS

And then theres the money.

One hundred million Americans have a 401(k) or IRA. And most of the money in those pension plans is in stocks. A lot of it in tech stocks. That means your pension gets a huge shot in the arm from Big Techs stock price surge!

This program has been on the air for 10 years and right from the start we tracked Big Techs rise. It has been a great ride.

The stunning financial reports this week show its not over yet. Hope you are enjoying the ride.

Original post:

Varney: Big Techs stock price surge a 'huge shot in the arm' for pensions - Fox Business

Rohit Kulkarni, MKM Partners managing director, discusses some of this weeks biggest tech earnings, including Amazon, Facebook, Pinterest and Twitter.

JULIE HYMAN: Let's talk about some of the companies that are set to report after the close of trading. Facebook is top of mind. Rohit Kulkarni is joining us now, MKM Partners managing director. Rohit, good to see you. You know, do we get any pull through from the likes of Alphabet and some of the ad spending trends that we saw reflected in those numbers? Does that bode well for Facebook?

ROHIT KULKARNI: Yeah, absolutely. I think-- again, thanks for having me. I think what Google told us yesterday, both from a macro as well as a micro perspective, that online spending of consumers is elevated. It's coming back.

Second, from a macro standpoint, I think across all verticals, the level of beat that Google gave us yesterday was-- couldn't have been possible unless all the verticals except travel have been kicking into high gear for Google. So that's a very clear positive macro read for Facebook. Facebook has similar look and feel and composition of revenues. They do a little bit more digital native brands, which we think are also doing well.

And, of course, from travel, retail, tech, CPG, various different sectors that have different cohorts of reopening plays baked into the next six months, I think that bodes well for Facebook. So we feel positive beat and raise numbers coming in for Facebook as well.

- Rohit, on Pinterest, really a mixed quarter out of that company. The stock is under pressure as a result. How concerned are you about life after the pandemic for Pinterest? Which has benefited during the pandemic, because we have all been home on the platform. And then if you do have that concern, how important is it that Pinterest does, in fact, explore a sale, that this is a company that ultimately becomes a subsidiary of Microsoft?

ROHIT KULKARNI: Huh. What I would say is for Pinterest, we are buyers on the dip that we are seeing today. The reason why I say that is Pinterest, as a company, we have-- we think that they can navigate this user penalty box they have put themselves into. I think this company probably under invested in marketing and top of [INAUDIBLE] education of consumers as to how the platform has evolved over the last 18 months.

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They have added very many consumer-oriented features. I feel Pinterest is going to do just that. And users for all social media platforms, as you know, are the best leading indicator for what future performance would look like. Pinterest probably focused a lot more on advertisers over the last 12 months. They got that. Their revenues are accelerating. Their monetization is kicking into high gears.

Now they need to go back to the supply side, which is users and engagement, and which-- once they do that, I think Pinterest is going to be a more stable story. It is, again, a reasonably recent IPO, if you were to look at the history of Pinterest. And they are balancing supply and demand. Right now, demand is good. Supply they just need to work on.

So I feel-- I feel good about the longer-term prospects. This is a story that we-- we like heading into back half of '21 as well.

- You know, Rohit, another name that you cover that I kind of associate in this bucket of anything that isn't Google and Facebook. And that, of course, would be Twitter. Now, Twitter's story has changed a little bit. An activist in there. They're ramping up their product roadmap.

But when you think about, you know, a name like a Twitter, a name like a Pinterest, are they still kind of in this rising tides, lifting all the boats? I mean, you see the kind of quarter that you were just saying you're likely to see from Facebook tonight. Does that continue to augur well down, you know, the ad stack, if you will?

We saw from Snap last week indicates to some extent, yes. But how do you think about that from an ecosystem standpoint?

ROHIT KULKARNI: Yeah, you said it right-- right on, as in it's a rising tide that lifts all boats, as in-- if you remember what happened in March, April, May of last year, all these companies got a pullback from ad spend, and they are facing easier comps. Pinterest is going to grow more than 100% year-on-year on easier comps in Q2. That's the highest that-- growth rate that this company has ever had in the last five years.

Same with Google. Probably we will hear the same with Facebook. I think what would matter beyond Q1 earnings is whether-- how sticky this growth is going to look like in Q3 and Q4, once the comparables start getting tougher and tougher. I feel Twitter, the bar is high for them, given what has happened to the stock, given what they said in a post-Trump era about users, given what they're doing with direct response.

So the bar is high for Twitter. We like-- it is a good reopening play with Olympics, with events, with conferences, with live sports, as well as various different brand advertisers coming back to the platform. So Twitter should have a double tailwind, if you will. The platform is improving. The tailwind is getting stronger. And brand advertisers are coming back.

So there are more tailwinds in the favor-- in Twitter's favor. So if they execute, I think that's the biggest question mark, as an execution on the basis of technology is something that investors aren't fully convinced yet, like what Snap has been able to do or to some extent Pinterest has been able to do. Twitter is still their show-me story. I feel we'll know more about that tomorrow.

JULIE HYMAN: And finally, I want to end on another come to you cover that isn't really a show-me story. They've shown us quarter after quarter. I'm talking about Amazon, which at this point obviously is just a juggernaut on the e-commerce side and on the cloud side. Is there any suspense with Amazon? Like, what is your big outstanding question for this company?

ROHIT KULKARNI: I think the biggest outstanding question as in Amazon is a company from a stock's perspective. You buy on weakness. You buy on strength. It is a company that is, as you said, it's a juggernaut.

I think the suspense here is, what happens in 2Q? As in there are-- when we talk to investors, remember what Amazon did last year. They reported the highest growth rate for e-commerce and Amazon retail ever in 2Q. They had the best profitability in 2Q, despite spending $5 billion extra. So what happens in Q2 of 2020? We'll know more tomorrow. We have seen a wide dispersion in investor expectations, as in some people expect more than $110 billion in revenue. Some people are expecting $105 billion in revenue for Q2.

So we will see that. I think that will probably lead to some volatility in Amazon's shares. But regardless of what happens, I feel this is a company that's executing and has probably the best portfolio of products, be it cloud, advertising, and retail. And no matter which part of the reopening play you are in, either of all of them or at least two of them continue to succeed. So I think Amazon-- Amazon is a company that we are behind.

But I think the suspense is around 2Q outlook. And if I have to zoom into it a little bit more, what is the next big bucket of spend that Amazon will find? As in last year, they spent about $12 billion extra on COVID. Of course, Street is not modeling all of that comes back this-- this year, but some of it will come back. And Amazon always finds ways to spend money.

So what will that be, and how are they thinking about ROI of that spend? So those are the suspense items, if you will. But I think, as I said, all three segments benefit from reopening. And I think Amazon is something that has traded flat. We like it.

JULIE HYMAN: Amazon always finds ways to spend money, so true. Rohit Kulkarni, thank you so much, MKM Partners managing director. We look forward to those numbers and to your notes on them afterwards.

See the article here:

Breaking down this weeks big tech earnings - Yahoo Tech

After being beaten down on the tech sectors lofty valuation concerns last month, the tech-heavy Nasdaq Composite Index scaled new record highs ahead of the optimism over the big tech earnings wave with more room for upside. The index set its first record since February, representing the 13th record close of 2021.

This has confirmed the end of an 11% correction in the index that began after its previous high on Feb 12, with the index closing at a low on Mar 8.

Tesla Motors TSLA posted the biggest profit in its history shrugging of the global chip crisis when it released Q1 earnings after the closing bell on Monday. The electric carmaker beat estimates on both earnings and revenues.

Tech giants like Microsoft MSFT and Alphabet GOOGL are scheduled to release their earnings today after the bell while Facebook FB and Apple AAPL will report on Apr 28. Amazon AMZN is slated to report on Apr 29. Total Q1 earnings from the group of these five companies are expected to be up 43.5% on revenue growth of 31.4%. This reflects a solid improvement from the Q4 earnings growth of 41.2% and revenue growth of 29% (read: Big Tech Q1 Earnings Look Strong: ETFs to Play).

Further, many other semiconductor companies like Texas Instruments Incorporated TXN and Qualcomm Incorporated QCOM are scheduled to report this week. Texas Instruments has a Zacks Rank #2 (Buy) and an Earnings ESP of +4.25% while Qualcomm has a Zacks Rank #3 (Hold) and an Earnings ESP of 0.00%. Per our proven model, the combination of a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) increases the chances of an earnings beat. You can uncover the best stocks to buy or sell before theyre reported with our Earnings ESP Filter.

Investors seeking to ride the Nasdaq could consider the following ETFs. These funds might see massive trading volumes in the days ahead as Q1 earnings unfold.

Fidelity Nasdaq Composite Index Tracking Stock ONEQ

This ETF tracks the Nasdaq Composite Index, holding a broad basket of 1,016 stocks. It has AUM of $4 billion and an average daily volume of around 564,000 shares. The expense ratio comes in at 0.21%. The product has gained 9.4% in the year-to-date frame and carries a Zacks ETF Rank #1 (Strong Buy) with a Medium risk outlook.

Invesco QQQ QQQ

This ETF provides exposure to 102 largest domestic and international non-financial companies listed on the Nasdaq by tracking the Nasdaq 100 Index. QQQ is one of the largest and most popular ETFs in the large-cap space, with AUM of $161.4 billion and an average daily volume of 54.7 million shares. It charges investors 20 bps in annual fees and has risen 9% so far this year. The fund sports a Zacks ETF Rank #1 (Strong Buy) with a Medium risk outlook (read: ETFs to Ride the Nasdaq Composite's Much-Awaited Comeback).

First Trust NASDAQ-100 Equal Weighted Index Fund QQEW

Holding 102 stocks, this fund provides equal exposure to stocks on the Nasdaq-100 Index. It has amassed $1.3 billion in its asset base while it trades in lower volumes of nearly 97,000 shares a day on average. It charges 59 bps in annual fees and has gained 8.1% in the year-to-date period. QQEW carries a Zacks ETF Rank #1 with a Medium risk outlook

Invesco NASDAQ 100 ETF QQQM

This fund is identical to QQQ tracking the NASDAQ-100 Index but comes with lower annual fees of 15 bps. It holds 104 securities in its basket with higher concentration on the big tech giants. QQQM has accumulated $822.3 million in its asset base since its debut last October and trades in an average daily volume of 128,000 shares. The ETF is up 9% so far this year (read: Best ETFs for Long-Term Investors).

ProShares Ultra QQQ QLD

Investors seeking to make big gains in a short span can bet on QLD. It provides twice the return of the NASDAQ-100 Indexs daily performance and exchanges around 2.1 million shares in hand on average. The fund has an AUM of $4.4 billion and charges 95 bps in fees and expenses. It has surged 16.4% so far this year.

ProShares UltraPro QQQ TQQQ

For a more bullish approach, TQQQ could be an excellent choice. It also tracks the NASDAQ-100 Index but offers thrice the returns of the daily performance, with the same expense ratio of QLD. The fund has amassed $11.4 billion in AUM and trades in a heavy volume of 41 million shares on average. TQQ had returned nearly 22.3% in the year-to-date period.

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Microsoft Corporation (MSFT) : Free Stock Analysis Report

Amazon.com, Inc. (AMZN) : Free Stock Analysis Report

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Big Tech Earnings Wave to Push Nasdaq ETFs Higher - Yahoo Finance

Amazon.com Inc. tends to be one of the most-searched-for companies on MarketWatch.

This quarterly review of Amazons stock will show comparisons of key metrics to watch and a summary of the companys most important issues to help investors make better decisions.

These updates will also include comparisons of results to competitors. Keep in mind that no two companies are alike even rivals dont compete in every space. Any investor needs to do their own research to make informed long-term decisions.

Read: Amazon earnings preview results to be released after the close April 29

Also: Amazon is giving more than half a million warehouse workers a raise

Amazon AMZN, +0.45% is the third-largest publicly traded company in the world, behind tech giants Apple Inc. AAPL, -0.32% and Microsoft Corp. MSFT, -1.54%. (Read MarketWatchs quarterly update on key metrics for Apple and Microsoft.)

But unlike those other two companies that have fairly defined flavors Apple is an icon in consumer hardware and Microsoft is the gold standard in enterprise software Amazon isnt as easily categorized. It began as Earths biggest bookstore, according to an early slogan, before becoming a store for everything and more recently, a cloud-computing leader, thanks to its Amazon Web Services division.

There are some similarities between AMZN and other big tech rivals, but a look at its segments shows the very unique nature of its massive operations. Amazon.com North American consumer sales include e-commerce transactions as well as sales at its brick-and-mortar Whole Foods grocery stores that were acquired in 2017. Everything sold outside of North America is classified under its International segment. Both of these segments exclude Amazon Web Services, however, which provides on-demand cloud computing and related services.

Whats particularly interesting about Amazon is how widely these segments vary in revenue and profitability trends. When you look at only revenue, North America sales is the business line to watch as it represents about 60% of the total top line at present and is still growing fast on top of that.

However, when you look at bottom-line impacts, the comparatively small AWS arm that accounts for only about 10% of sales delivers a massive 52% of total operating income, owing to juicy margins on this high-tech service arm.

The International segment is operating at a modest loss as Amazon invests in growth plans overseas. In part because of this, AMZN has the lowest operating margin among Big Tech stocks. In fact, its fourth-quarter report shows overall margins had decayed even further from the prior year.

So while Amazon boasts an amazing history of sales expansion, its important to understand that it is also investing a lot of capital into these expansion efforts that ultimately offsets the relatively fat profit margins on the smaller, focused AWS segment.

Beyond profits and sales, many investors are interested in cash-flow generation metrics. In a nutshell, this figure is a sign of how much cash a company is generating after paying the costs of doing business. And based on the specific nature of Big Tech stocks from Amazon to Apple, free cash flow can vary significantly.

The good news for Amazon investors is that while sometimes profits can be thin, there is a ton of cash moving around. As a result, it has the second-highest free cash flow per share among its peers over the past 12 months.

Heres a comparison of the six companies changes in free cash flow per share for the past 12 reported months from the year-earlier 12-month period, along with trailing 12-month free cash flow yields, based on closing share prices on April 26:

Following a more traditional valuation model, here are price-to-earnings (P/E) valuations for the six major tech stocks, based on consensus earnings estimates for the next 12 months among analysts polled by FactSet, along with total return figures through April 26.

Once again, youll see that the big investments in Amazon and its comparatively smaller profits are reflected. AMZN has the highest P/E ratio of the bunch but investors should remember that people have been maligning Amazon based on this metric for years and that hasnt stopped the stock from consistently outperforming.

Apple also has the highest percentage of buy or equivalent ratings among this beloved group of companies.

Heres a summary of opinion among Wall Street analysts polled by FactSet:

As a group, analysts working for brokerage companies love Big Tech stocks. But Amazon stands atop them all with nearly universal support among all the experts covering the stock. Furthermore, the potential for upside based on the average 12-month price target is 18% the highest in this group.

These are just estimates, of course, and theres no guarantee AMZN will get there. But the consensus of optimism among Wall Street firms is noteworthy nevertheless.

With reporting by Philip van Doorn.

Excerpt from:

Should you buy Amazon stock? Analysts prefer it over other Big Tech companies - MarketWatch