Amazon Stock Hits a New All-Time High: Is It Still a Buy?

Amazon's artificial intelligence (AI) and chips businesses have been thriving of late.

Its cloud platform, Amazon Web Services, achieved its best growth in years.

Its earnings were, however, inflated due to investments in Anthropic.

Leading e-commerce and tech company Amazon (NASDAQ: AMZN) has been rallying recently, after posting strong quarterly earnings numbers, hitting a new all-time high of more than $287 along the way. It's now up around 19% for the year, and its market cap is hovering around $3 trillion. The business has been doing exceptionally well as its growth rate has been solid, and its growth opportunities are plentiful.

But has the stock gotten too expensive, or can it still be a good buy at its current levels?

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A key reason investors have been bullish on Amazon's stock of late has been due to its popular cloud platform, Amazon Web Services (AWS). In the most recent quarter, which ended on June 30, AWS achieved its fastest growth rate in 18 quarters -- 37%. Not only is that important from a growth angle, but AWS also generates the best margins for the business; thus, a strong performance will also boost the bottom line. Of the $27.5 billion in operating income that Amazon posted last quarter, $16.6 billion, or 61%, came from AWS.

Despite spending heavily on artificial intelligence (AI), investors are becoming bullish that Amazon's efforts are paying off; CEO Andy Jassy says that "our AI and chips businesses each eclipsed run rates of more than $25 billion." All in all, the business is doing exceptionally well, with Amazon beating expectations on top and bottom lines for this most recent quarter.