One of the most successful company tales of the recent past is Amazon’s. From the website bookstore company it used to be back in 1994 to the current e-commerce giant company with cloud computing and artificial intelligence capabilities, the company made record profits for its shareholders. If you had bought Amazon stock 20 years back—March 2005—at the price point of $1,000, your investment would be a humongous amount by March 2025. Let us calculate and see how Amazon rose by the multiples.
Amazon stock price as of March 2005
Amazon’s stock priced around $1.71 per share following the adjustments for stock splits occurred in March 2005. This would have made you the owner of nearly 585 Amazon shares.
Amazon stock price as of March 2025
Flash ahead to March 2025. The Amazon stock currently trades for $234.62 per share. Your investment would now be worth;
Investment Value=Shares Purchased×Current Stock Price=584.8×234.62≈$137,205
Your original investment of $1,000 would now be around $137,205 after a return of more than 13,600% after two decades.
This consistent annual increase reflects the value of perseverance and the rewards of holding high-growth stocks towards attaining impressive gains.
The rise of Amazon
Here’s how Amazon became so gigantic. Amazon’s strength lies with its ability to innovate and dominate multiple markets. The following are the primary reasons behind its aggressive expansion:
1. E-commerce domination
Amazon revolutionized retail with internet shopping with wide selection and instant delivery. Its introduction of Amazon Prime in 2005 further solidified its leadership with free shipping and value-added incentives.
2. Cloud computing leadership
In 2006 Amazon launched Amazon Web Services (AWS), which became the de facto industry leader in cloud computing shortly after. AWS is now one of Amazon’s most profitable businesses and the primary driver behind the stock’s value appreciation, adding nearly 70% towards operating profits in recent quarters.
3. Diversification
Amazon diversified into new areas including entertainment (Amazon Studios), hardware (kindle and echo devices), groceries (merging with Whole Foods), and medicine (PillPack). With this expansion into new areas, the reliance upon a single source reduced and the company expanded into a global giant.
4. Strategic reinvestment
Amazon continued investing earnings into logistics network, Research and Development expenditure, and purchases like Kiva Systems for automating warehouses and PillPack for selling medicines online. It allowed it to expand internationally without losing competitiveness.
5. Market sentiment
As one of the FAANG stocks (Facebook/Meta, Apple, Amazon, Netflix, Google/Alphabet), Amazon benefited from the surge in investor optimism towards tech companies over the past two decades.
Lesson for investors
The Amazon tale contains valuable lessons for would-be wealth builders who want to earn profits from the stock market:
1. Long-term vision
Those who held their shares despite short-term fluctuations in the stock market made their fortunes. Patience usually pays when one invests in new-age corporations.
2. Identify high-growth companies
Amazon’s triumph was fueled by its ability to disrupt markets and create new sectors. Selecting companies with great vision-led leadership teams and scalable businesses can bring gigantic returns.
3. Accept volatility
Along the way were a series of corrections and moments of underperformance1. But the loyal who stayed the course rode its longer term trend.
4. Invest diversify
Although Amazon returned very well, the others need to be diversified in order to limit the risk and prevent losses from other investments. Determine $1,000 invested 20 years ago into Amazon stock would be around $137,205 today—a demonstration of the raw strength of the company’s expansion and the strength of extended investing.
Although past results are no guarantee of the future results, the example does illustrate the value of entering into the most revolutionary businesses early and holding through the extended term. For today’s investors looking for the same opportunities, investing in disruptive companies with solid fundamentals can be a way to achieve substantial wealth creation in the long run.
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