Here’s why I believe (NASDAQ:AMZN)Mattel (NASDAQ:MAT), and St. Joe (NYSE:JOE) are worthy of investors’ money at current prices.


Shares of Amazon have shot up 2,300% over the last decade, but don’t think you have missed the boat — there are two good reasons why the stock is still a great investment at the current price of $1,831 per share.

First, there’s still a long runway of opportunity in e-commerce, given that physical stores still generate about 90% of worldwide retail sales.

Plus, Amazon’s relentless focus on delivering a better customer experience with technology will likely keep it ahead of the competition. For example, the company continues to push forward with the use of robots to lower fulfillment costs, which speeds up order processing and allows Amazon to pass the cost savings to customers with lower prices.

Second, and perhaps the best reason to consider buying Amazon, is the fast growth of Amazon Web Services (AWS). AWS sales increased 41% year over year last quarter, and it’s now generating an annual run rate of $30 billion in revenue. More important, AWS produces an operating margin of around 30%, which means it comprises most of Amazon’s profit right now.

Consider this: IBM is acquiring Red Hat, an enterprise cloud service provider, for 10 times sales. Applying the same valuationto AWS gives a valuation of $300 billion. However, AWS could be worth more since it is growing faster and earning better margins.

Analysts think AWS will be worth between $350 billion and $1 trillion within the next five years. Amazon’s market value is currently $905 billion (total shares outstanding times the stock price), which means investors are placing a fair value on AWS five years out but assigning much less value to the rest of the company.

2. Mattel

Shares of Mattel, the maker of Hot Wheels and Barbie, fell hard over the last few years. The stock’s slide stemmed from previous management mistakes that left the company debt-ridden and unprofitable. But new management has stepped in and has a plan to turn Mattel into one of the most profitable companies in the industry.

Recent results show management’s strategy is…

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